Are There Still Opportunities to Serve & Grow?

Are there still opportunities to serve more people and grow?? I read an article by Rich Chesney who suggests that hospice is stuck in a rut. The article took an 11-year snapshot of hospice utilization, only to find that while hospice utilization was growing at the beginning of the period, that utilization seems to have plateaued. As in most industries that have reached a mature state in their development, doing things the same old way to serve more patients and grow has only gotten hospices limited growth. Add to that, increased regulatory scrutiny and pressure, and hospices are finding growth harder to come by and they become even more conservative about who they accept and keep on service. The data in Mr. Chesney’s report shows that the opportunity for growth is there. And I agree with him. The challenge is to create better ways to serve referral sources, provide a superior patient and family experience and truly understand the value propositions for each segment you are targeting and deliver.

Hospice Chart 1

The 11-Year Snapshot

  • Across the 11-year period, there is a wide variation in average hospice utilization growth rates among states. For example, utilization growth rates were as low as 17% for Colorado but as high as 849% for Alaska.
  • Generally speaking, while the first 6 years were characterized by robust growth and increased utilization, in year seven that growth plateaued, then picked up modestly in 2009 only to plateau again in 2013.
  • Some states, such as Arizona, Florida and Kansas, are already seeing hospice utilization declines, rather than growth for the last three years.
  • Other are in decline for the last two years: New Jersey, Delaware, Iowa and South Dakota.
  • Only a few have been able to turn 2012 declines into modest 2013 growth: Oklahoma, Rhode Island and Wyoming.

2013 Breakdown

  • The 2013 national average hospice utilization rate is 2.46%.
  • There is a wide variation in 2013 hospice utilization rates among states, ranging from Alaska with the lowest rate of 1.16% to Utah with the highest rate of 3.6%.
  • For 2013, the states in the top quartile of hospice penetration rates use hospice 75% more often as states in the bottom quartile: 3.23% (on average) versus 1.85% (on average).

Hospice chart 2

So the big question is, what does the future hold for hospice use nationally and in your local market? Clearly, hospice utilization gains are becoming more challenging and securing hospice growth significantly becomes more complicated. Once upon a time, geographic expansion held the key to solid growth. This isn’t the case today as some markets are over-saturated, CON still plays a role in a number of states and others are leveling off on their utilization rates.

There are, however, still many opportunities to serve more people and grow!

Chesney’s research illustrates that that 7% of the Medicare patients who are discharged alive from a hospital die within 30 days. That is a larger number of patients than could receive the gift of hospice.

Still too many patients, who die in LTAC’s or SNF’s, are hospice candidates. All these factors are compounded by the fact that hospice’s median length-of-stay has barely budged in the past several years.

One innovative program approach to help startup hospice utilization is Palliative Care. Many Insurance Companies, ACOs and large organized physician groups are exploring Palliative care aggressively. This is an opportunity for a hospice company to develop key strategic partnership. Another growth strategy is to “up your patient care game” so as to quickly, safely and easily care for this 7% of patients who die after being discharged from a hospital. Along with this, create GIP programming with your acute care colleagues with significantly help them achieve their mission and business objectives.

Lastly, work on improving your LOS, consider targeting and creatively working with segments like Senior Living Communities, Disease Management Group, Geriatric Community Case Managers and Geriatric Assessment Centers, to name a few.

Please go back and review my past post as I provide for specific thoughts and recommendations on way to increase Length-of-Stay.

The Best

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