Editor’s note: This is the third in a series of commentaries on the issues of health care that will have major funding impact on the economy for 2013. The topics will include senior care, obesity and universal medical insurance.
Providers of senior health care, grateful families of terminally-ill patients and the community in general were shocked that San Diego Hospice was the target of Medicare investigators claiming overbilling.
The issue: Hospice patients lived beyond the arbitrary six-months required to receive hospice care but continued to receive medical care paid by Medicare.
A major shakeup in San Diego Hospice administration and termination of critical services to survivors of deceased patients was announced immediately as the government auditors may demand millions of dollars in billing refunds from the popular provider of medical care for dying persons and counseling for their families.
At press time, San Diego Hospice filed for bankruptcy protection to permit an orderly reorganization in order to settle debts. In addition to undisclosed Medicare refunds, $9.8 million in liabilities were listed, including lease contracts for office space vacated under the cutback of operations.
Medicare began funding national hospice care in 1982. Since 2000, payments for hospice programs have ballooned from $3 billion to $13 billion in 2010, making the providers targets for Medicare auditors desperate to cut costs of government funding for health care, reported U-T San Diego.
Kathleen Pacurar, CEO of San Diego Hospice, told a group of concerned supporters that there is no perfect method to determine end of life. When a patient applies for hospice care under Medicare, the criteria for coverage is six months of remaining life. If a patient survives beyond that arbitrary benchmark, Medicare coverage is technically terminated.
What is the victim supposed to do? San Diego Hospice continues to comfort the terminally ill patient, but Medicare doesn’t want to pay the ongoing cost. San Diego Hospice already has a shortfall of operations cost beyond Medicare coverage of at least $3 million a year. That requires a broad development program for donor gifts and grants to keep the doors open.
Now Medicare indicates that San Diego Hospice must refund millions of dollars in reimbursement following its February 2011 audit for services exceeding the six-month care criteria. The local hospice officials admit their internal control gaps in meeting the Medicare rules. However, they did provide the necessary care needed for the comfort of their patients that may have to be refunded.
In order to keep providing hospice care, drastic cut-backs were installed at the San Diego facility. The 24-bed care center in Hillcrest was closed; 210 staff members were laid off; the daily census of patients was reduced from 1,000 to 500; the budget was cut from $83 million a year to $63 million. Those represent substantial reductions in serving the community, especially the seniors most in need.
San Diego Hospice was founded 35 years ago and has cared for an estimated 66,500 terminally ill patients. The construction of the state-of-the-art care facility became a model for hospice centers across the country. Keeping the patients comfortable in their home is the goal of hospice care. However, when hospitalization is necessary, the care center provides a home-like environment for the patient as well as the family.
The focus of this commentary stresses the expanding needs for seniors. The large population of baby boomers will live longer and suffer more health problems than their parents. Expert providers in senior health care have been warning communities and government agencies for a decade of the coming tsunami of accelerating medical costs with little response.
A prominent spokesperson for senior care in San Diego is Paul Downey, CEO of Senior Community Centers. His open letter to newly elected Mayor Bob Filner predicted that by 2017 there will be a 91 percent increase in citizens over age 65. The economic reality is even more critical since two out of five seniors today lack adequate financial resources for basic necessities of life -- food, shelter and health care. With the loss of redevelopment funds, affordable housing for seniors creates a shortage and drives rents up.
Downey was the keynote speaker at a recent seminar on the aging of America. Nationally, there are 40 million seniors over 65. That will increase to 90 million in 2030, in what he referred to as the Boomer Tsunami. A UCLA study forecast the annual cost of basic living needs to be $24,000, an amount beyond Social Security or modest pension payments being paid to elderly citizens who retired many years ago. Who foots the bill for the shortfall?
As the birthrate continues to diminish, Downey sees a shortage in caretakers for the elderly and workers contributing to entitlement programs through payroll taxes. That means the future will rely on more government support of seniors.
With these future changes in health care for seniors, what are the prospects for providing adequate medical services for the growing society of the frail and elderly that most likely have outlived their resources? Will the next generations step up as caretakers? Will there be enough doctors and medical technicians to serve the increasing senior population?
Obamacare may not have the solutions or the financial ability to answer these questions until the working generations (the makers) are outnumbered by retirees (the takers). It will be too late to fund the medical costs while taxpayers oppose any new source of government revenue.
Ford is a freelance writer located in San Diego. He can be reached at email@example.com.