Advanced illness care reduces costs through integrated care, without reducing the quality of care

By Gwen Cooper

With the repeal, replace or repair of the ACA as a top conversation among legislators, regulators, providers, payers and consumers, the opportunity to disrupt the fragmented healthcare system is now. This can be accomplished through the adoption of innovative, sound programs that bend the cost curve and provide increased value to both providers and users of the system. Health care systems worldwide are facing macro-scale changes involving advanced illness and end-of-life care that could affect both the quality of care and quality of life for patients and their caregivers.

The number of Americans over the age of 65 is set to grow to 89 million by 2050. While Americans live longer, over 70 percent of people 55 and older and 85 percent of those 65 and above are living with at least one chronic illness. Medical spending for this population in the last year of life is estimated at $80,000 per person. High-need, high-utilizers of the system account for the five percent of patients that spend 50 percent of the annual healthcare expenditures. This important group provides a great opportunity to reduce costs for this population through integrated care, without reducing the quality of care.

Advanced Illness Care

Advanced Illness Care (AIC) is a focus of palliative care and provides specialized medical care for patients with serious illness. AIC is provided by an interdisciplinary team of professionals who have expertise in symptom management, advance care planning, care coordination, and the development of individualized care plans that align with patients’ goals and values.

The goal of palliative care is to provide the best possible quality of life for patients and their families. The most familiar type of palliative care is hospice care, which is specialized palliative care for patients with an expected prognosis of six months or less, but palliative care also extends further upstream into the care of patients who are not eligible for hospice, either because of treatment preferences or a prognosis greater than six months.

The original Medicare benefit for hospice was envisioned as a reimbursement mechanism primarily to care for people with advanced cancer, key elements of the benefit are not optimal for the care of people with other diseases where a prognosis is longer than six months such as Chronic Obstructive Pulmonary Disease, Congestive Heart Failure, Alzheimer’s disease and other neurological diseases.

AIC programs have been shown to improve the quality of care and to reduce costs. Coordinated care that is aligned with patient and family preferences, like the services offered through advanced illness care programs, produces a positive outcome for patients and providers.

Although the current reimbursement structure provides minimal to no coverage of home-based advanced illness care, healthcare is evolving in multiple ways with focused initiatives and payment structures tied to quality and cost of care.

This shift in value based care prompted Hosparus Health to pilot an advanced illness care program to help the sickest and most vulnerable patients and their families. The goals are simple, to illustrate the value of the program through patient and family testimonies of their improved quality of life, document cost savings to the healthcare system, and use our voice to pass key legislation that will lead to an eventual advanced illness care Medicare benefit.

From 2015-2016 Hosparus Health led an AIC pilot program involving twenty-two patient participants. The pilot was conducted in collaboration with, and partially funded by, a commercial health insurance provider. The outcomes below are telling.

Measure Hosparus Health AIC National Average/ Benchmark
 Percent Patients with completed

Advance Directive

78 percent < age 60= 30 percent

> age 60= 50 percent

ER Visits Avoided 30
Estimated ER Cost Avoidance $ 36,000 $ 1,200/visit average in 2015

Inpatient Cost Avoidance

$180,000- (6) stays of 3 days at cost per stay of $30,000

*Likely to be higher in this population

1 in 5 ER visits results in hospitalization

(CDC), $30,000/

stay (per

Patient/Family Satisfaction Overall 4.9 (Very satisfied) 1-5 scale


This small pilot inspired Hosparus Health to allocate significant financial resources to expand the pilot as a private pay model in 22 Kentucky counties. Additionally, we continue to work with commercial insurance companies to pilot our program with their costliest and most needy patients, further documenting that improved quality of life through coordinated care will lower costs and improve quality of life, thus improving value.

Healthcare experts across the continuum of care realize the importance of supporting individuals and families living with advanced illness, and key Federal legislation that will change the trajectory of healthcare reimbursement is on the horizon.

One piece of legislation to watch and support is the recently introduced Patient Choice and Quality Care Act of 2017. The Act enhances existing Medicare coverage for end-of-life services to help ensure that the care a patient receives aligns with their values and choices, beginning the conversation towards a more robust Medicare benefit that includes advanced illness care.

-Gwen Cooper is Chief Marketing Officer at Hosparus Health in Louisville, Ky.


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