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Hospice Trends: Back to basics’ a good way to grow your hospice
Do what you already should be doing, but better
By Larry Beresford
The number of terminally ill patients enrolled in America’s hospices continues to rise, now topping 700,000 per year. But growth in patient enrollment has been counterbalanced in recent years by declining lengths of stay. The net result for many hospices has been stagnating average daily census, a more telling measure of actual growth.
In an uncertain and competitive environment for hospices, providers that can’t find ways to move forward and continue to grow may find themselves losing market share or even sliding backward.
Two proprietary national hospice chains, Odyssey HealthCare of Dallas and VistaCare of Scottsdale, AZ, are investing proceeds from stock market initial public offerings in an attempt at aggressive national expansion. The implication is that these two companies see potential for hospice growth and profitability. How successful they will be at dominating the hospice market nationwide remains to be seen. However, their strategic aims pose a significant challenge to existing hospice providers and suggest that many established hospices will be hard-pressed to find their own competing strategies for census growth.
Trendy new programs and product lines may not be the most efficient strategies for driving a hospice’s growth. Several leading hospice management consultants who work with clients around these issues every day suggest that hospices may get more return on investment from critically revisiting some of their most basic operations to improve performance on such fundamental tasks as:
Of course, in a field as diverse as hospice, not everyone will agree on the difference between basic and advanced versions of hospice management. Some hospices are better at the basics than others, while some, unfortunately, have viewed sound business strategies as somehow incompatible with a mission-driven orientation.
But the essential tasks of managing a successful, growing hospice program are much the same regardless of philosophy, model, setting, or community. Improving the basics is also recommended for developing new product lines or preparing for potential future affiliations or acquisitions.
A hospice that could extend its average length of stay by even three days through more timely admissions would experience significant growth in patient census and revenues. Similarly, using targeted marketing to increase referrals from a few key physicians or improving the agency’s "conversion rate" of referrals that result in actual admissions would spark growth without the need for new product lines.
Such growth often can be accomplished with less spending and less expenditure of staff resources than might be required to launch a hospital palliative care consultation service or a cardiopulmonary specialty team.
"Hospice managers don’t always want to look critically at their programs," says hospice consultant John Mahoney of the Summit Business Group in Penfield, NY. "It can be hard to do. They may be afraid of what they might find or doubt their ability to do something about it. Your expectation in doing this should not be one of perfection, but of looking for ways to do things better," Mahoney says. "What sometimes gets in the way is the attitude of hospice staff: We can’t do that, we don’t have the staffing, it’s too expensive.’ We can get stuck in the mindset that we can’t do anything about the issue. There is also the question of organizational culture; is this issue even important to us?"
Looking seriously and critically at the organization’s performance on basic operations also requires lots of data. Many hospices lack the data they need or the ability to generate useful knowledge from the data, Mahoney says. Developing tools, mechanisms, and processes for quantifying, tracking, and assessing overall quality of clinical care is also essential.
One of the most fundamental management issues for hospices interested in growth — beyond the even more basic imperative of consistently providing a high-quality, professional service at the patient’s bedside — is intake and admissions. What kind of message does the hospice’s intake staff give in response to that first, difficult-to-make call for help from patients, families, or harried physicians? Are the answers mostly "yes," with genuine offers to find solutions for the caller’s problems and a commitment to be as helpful as humanly possible? Or are they comments like: "We’re not sure if you are appropriate for hospice," or "Why don’t you call your physician and then you or he/she can get back in touch with us?"
Such comments instantly put roadblocks in the way of getting terminally ill patients the help they need. Over time, they also create a negative reputation for the hospice and contribute to declining lengths of stay.
How quickly can a hospice’s admission team get out to the patient’s home or to a hospital room (if that’s where the patient is at the time of referral)? Offering same-day admissions — or within 24 hours at the latest — is a hugely important target for elevating a hospice’s practice, as is the willingness to enroll terminally ill patients while they are still in the hospital.
Assessment visits that offer recommendations and equip the patient and family for making informed treatment decisions can be beneficial even if the patient turns out not to be hospice-appropriate or opts not to enroll in hospice care at the moment. And when callers only want information or a brochure, do intake staff obtain their phone numbers anyway and follow up with a phone call later to confirm that they received the help they needed?
Hospice managers should consider visiting their agency’s intake office every day, listening to how staff handle calls and reviewing every referral that results in a non-admission to determine whether there are fixable patterns or self-imposed barriers. Conversion rates lower than 75% to 85% at least deserve the manager’s scrutiny, says consultant Patrice Moore of the Watershed Group in Gainesville, FL.
Sales’ loses its stigma
"Over time, the hospice industry has gradually come to accept principles of selling and sales management," notes consultant Peter Benjamin, with the Huntington Group in Coconut Grove, FL. "When I first started working with Vitas Healthcare Corp. in 1991, hospice people were reluctant to even say the words sales’ or marketing’ out loud."
The new acceptance of a sales mentality in hospice reflects in part a growing recognition of the suffering experienced by many dying patients who never make it into hospice care, and hospice’s responsibility to make the service as accessible as possible for them. However, it is more common for hospices today to employ sales/marketing/community education representatives than to provide those people with the ongoing supervision they need, Benjamin says.
"For hospices’ business to grow, not only do they need a selling function, but they also need to assign responsibility for managing the people doing the selling. Evidence clearly shows that for sales professionals, if you coach them, manage them, analyze their results, get in the car and go out with them on calls, they perform better."
Another key, he says, is territory management — making sure sales staff are targeting the right people. Hospice managers and sales reps should be able to instantly name the agency’s 10 most important customers and 10 most important prospects for growth. They also may want to learn from other health care industries that depend for their success on influencing physician behavior.
"Do you know what a selling culture looks like and feels like?" Benjamin asks. "It is inherently customer-friendly. With some hospices, if you call them, it may seem like you reached the sales prevention department. Hospice professionals sometimes forget that hospice care is not something anybody would want or ask for if they didn’t really need it."
Other marketing strategies include providing targeted training to intake staff and then testing staff to make sure they give consistent, user-friendly, easy-to-understand answers about the hospice and its admissions policy. Getting professional consultation on the effectiveness of the agency’s brochures and other printed products and convening focus groups for in-depth exploration of the needs and perceptions of key constituencies can give the manager valuable information.
Hospices also face dilemmas over patients — or their physicians — who want to continue radiation treatments or chemotherapy described as "palliative." Such treatments may be difficult to cover under the hospice per-diem rate, but refusing to provide them often means an otherwise appropriate patient will come to hospice much later — if at all.
Instead of just saying "no" to such treatments, take the time to examine their impact, Moore suggests. "Do a study of who you have turned down because they were receiving radiation or chemotherapy. Then find out the actual costs of their treatments."
If providing such palliative treatments within the hospice plan of care makes it possible to enroll patients on the benefit weeks earlier, a case could be made for its net fiscal benefit to the agency.
"Often these seriously ill patients become more frail with treatment and don’t want the treatment to continue, but they don’t have anyone advocating for them if hospice won’t help them," Moore says. Hospices unwilling to commit to an open-access policy may find themselves in a Catch-22: unable to pay for costly outlier treatments because they don’t have a big enough caseload or length of stay to average the costs, and unable to admit more patients sooner because they can’t pay for their palliative treatments.
Declining length of stay remains one of the thorniest challenges facing hospice managers, a challenge with no easy answers. But it is essential that managers at least have current data — and not just on overall length of stay but broken down by physician, disease, and other key variables, Benjamin says. "I say to my clients, Let’s do a drill-down into the medical records, even if we have to do it by hand.’"
Hospices may resist telling individual physicians how they stack up on their patients’ average length of hospice enrollment, even though physicians by now are used to receiving comparative data from other sources, Benjamin says. "The next step is to actually influence their behavior — but that’s not back to basics. That’s the advanced marketing course."
[Editor’s note: Columnist Larry Beresford is a freelance journalist based in Oakland, CA, specializing in hospice, palliative, and end-of-life care. In 1999 and 2000 he was senior writer and editor for the National Hospice and Palliative Care Organization (NHPCO) in Alexandria, VA, and then the primary researcher and author of Hospital-Hospice Partnerships in Palliative Care: Creating a Continuum of Services, a report jointly issued in December 2001 by NHPCO and the Center to Advance Palliative Care. Beresford is also the author of the definitive consumer’s guide to hospice care, The Hospice Handbook (Boston: Little, Brown & Co., 1993).]