Hospice Acquisitions By Certain Firms And Corporations Were Associated With Reductions In Care Intensity, 2010-21

Area of Science:

• Health Services Research
• Health Economics
• Gerontology

Background:

• The increasing presence of private equity (PE) and publicly traded corporations (PTCs) in the hospice sector raises concerns about potential impacts on patient care quality due to profit motives.
• Limited empirical evidence exists on how these ownership changes affect the delivery of hospice services.

Purpose of the Study:

• To investigate the association between private equity and publicly traded corporation acquisitions of for-profit hospices and changes in care delivery, specifically focusing on staff visit minutes and Medicare reimbursement.
• To analyze the impact of these acquisitions on process-based quality measures.

Main Methods:

• A difference-in-differences event study design was employed.
• A national database of PE and PTC acquisitions was linked with Medicare claims data for a beneficiary sample from 2010-2021.
• Acquired for-profit hospices were compared to nonacquired for-profit hospices regarding quality measures and reimbursement.

Main Results:

• Following PE acquisition, registered nurse (RN), social worker, and home hospice aide minutes per 30 days decreased by 5.14%, 12.32%, and 6.62%, respectively.
• Following PTC acquisition, RN and home hospice aide minutes per 30 days decreased by 4.63% and 9.09%, respectively.
• Reductions in visit minutes were also observed during the final seven days of life and were notably driven by four large acquiring entities.

Conclusions:

• The findings suggest that PE and PTC ownership in hospice is associated with significant reductions in direct patient care visit minutes.
• These reductions, particularly in the critical last week of life, underscore the need for enhanced transparency, oversight, and payment reforms in hospice care.
• Policy interventions should aim to align reimbursement with care intensity and quality to mitigate potential negative impacts of investor-driven ownership.