Hospice use in Medicare managed care and fee-for-service systems

Objective: To examine whether patterns of hospice use by older Medicare beneficiaries are consistent with the differing financial incentives in Medicare managed care (MC) and fee-for-service (FFS) settings. Specifically, are use patterns consistent with incentives that might encourage hospice use for MC enrollees and discourage hospice use for FFS enrollees? Study design: One-year study of hospice use by Medicare beneficiaries dying in 1996. Patients and methods: Medicare enrollment and hospice administrative data were used to examine hospice use before death for all elderly individuals residing in 100 US counties with high MC enrollment in 1996. Age-, sex-, and race-adjusted rate of hospice use and length of stay in hospice are compared between FFS and MC enrollees across and within (when possible) the 100 counties. Results: Rates of hospice use were significantly higher for MC enrollees than for FFS enrollees (26.6 vs 17.0 per 100 deaths; P < .001). These differences persisted within age, sex, and race groups but were not related to area MC enrollment rate or the amount of money paid to managed care organizations. Age-, sex-, and race-adjusted differences were observed in 94 of 100 counties. Length of stay in hospice was marginally longer for MC enrollees than for FFS enrollees (median, 24 vs 21 days; P < .0001). Conclusions: System of care is an important determinant of hospice use in the elderly Medicare population.