National Hospice and Palliative Care Organization

Research Department

1700 Diagonal Road, Suite 300

Alexandria, Virginia 22314

703/837-3137

1

Hospice is a model for quality, compassionate care at the end of life. Hospice care, places

an emphasis on managing a patient’s pain and symptoms, and provides

psychosocial/spiritual support. An interdisciplinary team of professionals and volunteers

delivers the care. This model is tailored to the emotional, social, and spiritual needs and

wishes of patients and their loved ones.

NHPCO estimates that there are 3,200 operational hospice programs (including some

with multiple locations) in the U.S., including the District of Columbia, the

Commonwealth of Puerto Rico and the Territory of Guam. Hospices served

approximately 885,000 patients in 2002.

In 2001, 41% of hospices were free-standing entities, while 32% were affiliated with

hospitals, 22% with home health agencies, 1% with nursing facilities, and the remaining

4% under other auspice.

Seventy-two percent of hospices were non-profit, 24% were for-profit entities and 4%

were government operated. Ninety-one percent of hospices were Medicare certified, and

74% of all hospices were accredited.

Type of Ownership Percent

Non-Profit

72%

For-Profit 24%

Government 4%

National Hospice and Palliative Care Organization

Research Department

1700 Diagonal Road, Suite 300

Alexandria, Virginia 22314

703/837-3137

2

The demographic data for 2000 indicates that 13% of hospices served urban communities

(compared to 15% in 1998); 49 % indicated that they served rural communities

(compared to 42% in 1998); and 38 % indicated that they served both types of

communities (compared to 43% in 1998).

13%

49%

38%

Urban

Rural

Urban & Rural

1992 1995 1998 1999 2000 2001 2002

ALOS 64 days 61.5 days 51.3 days 48 days 48 days 48 days 51 days

MLOS NA 29 days 25 days 24days 25days 20.5 days 26 days

While the average length of service rose by three days in 2002, and the median length of

service rose by five and a half days in 2002, hospice referrals are still occurring too late

in the course of illness for patients and families to full benefit from the range of service

available from hospice. In 2001, 34% of those served by hospice died in seven days or

less, and 6% died in 180 days or more. The average length of service (ALOS) was 48

days; the median length of service (MLOS) was 20.5 days. MLOS is a more accurate

way to understand the experiences of typical hospice patients, due to the high frequency

of short stays.

States with the highest ALOS in 2000 were Alabama (69.7 days), Oklahoma (69.0 days)

and Virginia (66.3 days). Those with the shortest ALOS were Arizona (26 days),

Connecticut (35 days), and Tennessee (38.2 days).

Median length of service was highest in 2000 for Oklahoma (34.1 days), Virginia (29.9

days), and Alabama (28.9 days). The shortest MLOS was found in Connecticut (12.3

days), Illinois (13.4 days), and Massachusetts (14.7 days).

National Hospice and Palliative Care Organization

Research Department

1700 Diagonal Road, Suite 300

Alexandria, Virginia 22314

703/837-3137

3

In 2001, 94.5% of the days of service provided by our nations hospices were at the

routine home care level, 4.3% were general inpatient care, 0.4% to respite care and 0.8%

of the days continuous home care.

Upon admission, 81% of patients claimed hospice Medicare days as their payment

source, 5% reported Medicaid days, 11% private insurance days, 1% self-pay and 2%

cited alternative sources. Other payment sources may include, (but are not limited to)

Worker’s Compensation, Home Health Benefits, and donations. Furthermore, hospice

providers received an average of 13.6% of their revenues from non-reimbursement

sources.

In 1982, Congress created the Medicare Hospice Benefit, which is reimbursed under

Medicare Part A (Hospital Insurance). In order to be eligible for this benefit,

beneficiaries must be entitled to Medicare Part A and be certified by their medical doctor

and the hospice medical director as having a terminal condition with a prognosis of six

months or less to live if the illness were to run its natural course.

A signed statement electing hospice care instead of routine Medicare is necessary.

Prior to the enactment of the Balanced Budget Act of 1997, the Hospice benefit included

two 90-day benefit periods followed by a 30-day period and an unlimited fourth benefit

period. Currently, there are two initial 90-day benefit periods followed by an unlimited

number of 60-day periods. A physician must re-certify that a patient has six months or

less to live before each benefit period.

Routine Home Care 94.5%

General Inpatient Care 4.3%

Respite Care 0.3%

Continuous Care 0.8%

National Hospice and Palliative Care Organization

Research Department

1700 Diagonal Road, Suite 300

Alexandria, Virginia 22314

703/837-3137

4

In total NHPCO estimates that 885,000 patients were served by hospice in 2002. This

includes patients carried over from 2001 and those admitted in 2002. Also in 2002,

approximately 2.4 million Americans died from all causes. NHPCO estimates that

665,000 hospice patients died in 2002, an increase from the 600,000 who died in 2001.

More than one in four who die in our country are cared for by hospice.

In 2001, 56% of hospice patients were female and 44% were male. Of those served by

hospice, 0.4% were 17 years of age or younger, 1% were 18-34, 18% were 35-64, 20%

were 65-74, 34% were 75-84, and 27% were 85 or older. NHPCO estimates that

approximately 5,000 of the patients served by hospice were younger than 24.

In 2001, hospices served a population where 82% of the patients identified themselves as

White or Caucasian, 8.2%, Black or African American, 3.4%, Hispanic or Latino, 1.6%,

Other and 4.8%, were not classified into the previous categories.

Financial concerns can be a major burden for many patients and families facing a

terminal illness. Currently, the vast majority of hospice patients are Medicare

participants, giving them access to the hospice benefit, which substantially reduces the

patients’ out-of-pocket expenses.

There are no nationwide statistics on the actual cost of caring for a hospice patient. The

closest approximation is Medicare’s per diem (daily all-inclusive) rate, paid to hospices

for each day a patient is enrolled under the hospice benefit.

Effective April 1, 2001, the Health Care Finance Administration (now known as the

Centers for Medicare and Medicaid Services) provided an increase of 5% in the payment

rates for hospice care services. The current national Medicare rate, effective October 1,

2000, for routine home care is $110.56; continuous care $644.70; respite care $120.23;

and for general inpatient care $491.19 (adjusted for regional wage differences). It should

be noted, payments for hospice physician services are not affected by this provision.

A 1995 Lewin-VH1 study, commissioned by NHPCO, showed that for every dollar

Medicare spent on hospice, it saved $1.52 in Medicare Part A and Part B expenditures.

The 1995 study also showed that in the last year of life, hospice patients incurred $2,737

less in costs than those not enrolled under the Medicare Hospice Benefit. These savings

totaled $3,192 per patient in the last month of life, as hospice home care days often

substitute expensive hospitalizations. A 1988 study conducted by the Health Care

National Hospice and Palliative Care Organization

Research Department

1700 Diagonal Road, Suite 300

Alexandria, Virginia 22314

703/837-3137

5

Financing Administration showed savings of $1.26 for every Medicare dollar spent on

hospice.

their last year of life; almost 50% of these costs are incurred in the last two months of

life.

A 2001 report on the cost of routine home care in 1999 for Medicare hospice patients,

conducted by Milliman USA for NHPCO, found that the cost of daily care ($117.10) was

10-20% more than the amount that Medicare reimburses.

Hospice now cares for over half of all Americans who die from cancer, and a growing

number of patients with other chronic, life-threatening illnesses, such as end-stage heart

and lung disease. American hospices are leaders in caring for terminally ill patients with

HIV/AIDS.

53.6% of hospice patients served in 2001 were diagnosed with cancer upon admission.

The top five non-cancer causes of death in hospice patients include: end-stage heart

disease 10%, dementia 7%, lung disease 6%, end-stage kidney disease 3 %, and endstage

liver disease 2%.

In 2001, about 50% of Americans died in a hospital, about 25% died at home, and

another 25% died in a nursing facility. For those patients who died under hospice care,

52% died at home, 22% died in a nursing facility, 5.6% died in a hospice unit, 10.1%

died in a hospital, 7.6% died in a free-standing inpatient facility operated entirely by the

hospice, and 2.6% died in a residential care setting.

There is increasing awareness among the terminally ill and their families that satisfying

and comfortable care can be achieved when palliative measures, rather than lifeprolonging

objectives, are pursued. A major benefit of hospice is the bereavement

service offered to the patients prior to death, and to their families for at least one year

after death.

In 2001, there was an average of 38 staff visits per admission and 1.6 days between visits.

The average patient received a total of 5 visits per week from hospice workers.

Nationally, each full time nurse cared for 5 patients at a given time. Approximately

200,000 hospice volunteers contribute 13% of all clinical hours provided by hospices.

This is equal to over 10 million hours per year! Each family receives an average of 3.4

bereavement contacts from hospice following the patient’s death.

National Hospice and Palliative Care Organization

Research Department

1700 Diagonal Road, Suite 300

Alexandria, Virginia 22314

703/837-3137

6

The long-term survival of hospice in America is dependent on a public that is aware of

the benefits of hospice and palliative care services. According to a survey conducted by

the National Hospice Foundation, 75% of Americans do not know that hospice care can

be provided in the home, and 90% do not realize that hospice care can be fully covered

through Medicare. However, this survey also demonstrated that Americans desire the

kind of end-of-life services offered by hospice.

To learn more about hospice begin with the following questions and answers.

Hospice care is a philosophy of care that accepts dying as a natural part of life. When

death is inevitable, hospice seeks neither to hasten nor postpone it. Below is a list of

questions you should consider when looking for a hospice program.

Eighty percent of people who use hospice care are over the age of 65, and are thus

entitled to the services offered by the Medicare Hospice Benefit. This benefit covers

virtually all aspects of hospice care with little out-of-pocket expense to the patient or

family. As a result, the financial burdens usually associated with caring for a terminally

ill patient are virtually nonexistent. In addition most private health plans and Medicaid in

42 States and the District of Columbia cover hospice services.

The majority of hospice patients are cared for in their own homes or the homes of a loved

one. “Home” may also be broadly construed to include services provided in nursing

homes, hospitals and prisons.

National Hospice and Palliative Care Organization

Research Department

1700 Diagonal Road, Suite 300

Alexandria, Virginia 22314

703/837-3137

7

Hospice care is a family-centered approach that includes at a minimum a team of doctors,

nurses, social workers, counselors, and trained volunteers. They work collaboratively

focusing on the dying patient’s needs, be they physical, psychological or spiritual. The

goal is to help keep the patient as pain-free and lucid as possible, with loved ones near by

until death.

Below is a list of services available to Medicare hospice recipients.

Because round-the-clock, hands-on care is the hallmark of the hospice experience,

hospice provides trained volunteers to aid the family and patients. Most hospice

volunteers are trained to relieve the primary caregivers, do household chores and help

bathe the patients. Perhaps the most important task, however, is their ability to be “good

listeners.”

Hospice care is for any person who has a life-threatening or terminal illness. Most

reimbursement sources require a prognosis of six months or less if the illness runs its

normal course. Patients with both cancer and non-cancer illnesses are eligible to receive

hospice care. All hospices consider the patient and family together as the unit of care. In

addition to patients served, each year hospices support over one million informal

caregivers and another one million bereaved individuals in the United States.