Impact of a New Palliative Care Program on Health System Finances: An Analysis of the Palliative Care Program Inpatient Unit and Consultations at Johns Hopkins Medical Institutions

Abstract

Purpose: Palliative care inpatient units (PCUs) can improve symptoms, family perception of care, and lower per-diem costs compared with usual care. In March 2013, Johns Hopkins Medical Institutions (JHMI) added a PCU to the palliative care (PC) program. We studied the financial impact of the PC program on JHMI from March 2013 to March 2014. Methods: This study considered three components of the PC program: PCU, PC consultations, and professional fees. Using 13 months of admissions data, the team calculated the per-day variable cost pre-PCU (ie, in another hospital unit) and after transfer to the PCU. These fees were multiplied by the number of patients transferred to the PCU and by the average length of stay in the PCU. Consultation savings were estimated using established methods. Professional fees assumed a collection rate of 50%. Results: The total positive financial impact of the PC program was $3,488,863.17. There were 153 transfers to the PCU, 60% with cancer, and an average length of stay of 5.11 days. The daily loss pretransfer to the PCU of $1,797.67 was reduced to $1,345.34 in the PCU (−25%). The PCU saved JHMI $353,645.17 in variable costs, or $452.33 per transfer. Cost savings for PC consultations in the hospital, 60% with cancer, were estimated at $2,765,218. $370,000 was collected in professional fees savings. Conclusion: The PCU and PC program had a favorable impact on JHMI while providing expert patient-centered care. As JHMI moves to an accountable care organization model, value-based patient-centered care and increased intensive care unit availability are desirable.

Integration of oncology and palliative care: a Lancet Oncology Commission

“…147 Further, studies demonstrate that the vast majority of costs in late-stage cancer results from advanced therapy with marginal effects, ICU and emergency admissions, and protracted hospital stays, and not to direct personnel costs. 148 Estimates from the United States and UK indicate 25% of health-care expenditure is related to patients in their last year of life, while end-of-life care takes up 20% of hospital beds. 149,150 In sum these figures and findings indicate expenditures that can be reduced and that integration can serve this function.…”

Economic Evaluation of a Hospital-Based Palliative Care Program

“…The collection rate is 50% to 52%. Although costs are presented for all three categories, the subsequent analysis focuses on palliative transfer PEs, because our previous research 23 provided a comparator group to determine the cost difference between PC and usual care.…”

“…The cost-minimization analysis is compared with the costs in the Results and has been published separately. 23 Briefly, for the 153 PEs transferred to the PCU from other units, the study calculated the difference between (a) per-day variable costs in another functional unit before patients were transferred into the PCU (ie, Pre-PCU) versus (b) per-day variable costs after transfer to the PCU (ie, PCU). This analysis determined that the PCU saved the hospital $353,645 in variable costs, or $452 per PE per day (Table 1).…”

The care experiences of patients who die in residential hospice: A qualitative analysis of the last three months of life from the views of bereaved caregivers

“…However, the principles of hospice-namely, the residing philosophy of care, the quality of staff, and the physical environment-are transferable to other care settings, as was evident in positive accounts of select home and hospital care. Particularly in hospital, adopting a hospice approach to care for the dying (e.g., private spaces, specialized providers, patientand family-centric care) has been shown to significantly increase patient and caregiver satisfaction and improve system outcomes (Gade et al, 2008;Higginson & Evans, 2010;Isenberg et al, 2017).…”