PeaceHealth to challenge rival’s bid for hospice
It says county unable to support second center
Sunday, October 30, 2011
The nonprofit owner of Clark County’s only inpatient hospice care center plans to challenge an application by nonprofit Community Home Health & Hospice to build a second hospice facility in the county.
Executives with Vancouver’s PeaceHealth Southwest Medical Center contend the county’s population wouldn’t support a second hospice center. The hospital’s Ray Hickey Hospice House has been under capacity since its debut in 2004, according to PeaceHealth statistics.
That’s a concern because hospice centers rely heavily on donations and Medicare reimbursements to stay in operation, said some local gerontology experts.
“It’s competition in a world where money is already tight,” said Gail Haskett, a Vancouver gerontologist and member of the State Council on Aging. “We have no idea if Medicare is going to continue to fund hospice in the way it has.”
Longview-based Community Home Health & Hospice executives maintain that the county offers enough patients for two centers. CEO Greg Pang pointed out that the county’s 70-plus population is expected to double by 2030, according to the state Office of Financial Management. The demand for services such as hospice and long-term care are expected to grown in tandem, Pang said.
“I don’t think this is a zero-sum game where one loses and other wins,” Pang said. “I think both hospice centers are vital.”
The two nonprofits have been at odds over the hospice center plan for several months. During the negotiations, PeaceHealth offered Community Home Health & Hospice partial ownership of the Ray Hickey House if the organization would hold off on its plan to build another hospice center, said Marc Berg, director of PeaceHealth Homecare and Hospice.
Community Home Health & Hospice’s board of directors rejected the proposal because they didn’t think it was in the best interest of the organization, Pang said.
The dispute over the plan ultimately will be decided by the state Department of Health. Under state law, the agency is required to approve a certificate of need for a hospice center to be built.
Pang said his organization expects to apply for a certificate by Nov. 15. At that time, the organization will submit documentation on why it believes the center is needed.
PeaceHealth executives said they plan to simultaneously file a formal letter of opposition containing evidence of why an additional hospice center is superfluous at this time.
Community Home Health & Hospice’s plan calls for a 10-bed hospice center to open in early 2013 at 3100 N.W. 136th Circle in Vancouver to house its Clark County operations. It currently leases space at 14508 N.E. 20th Ave. for its Clark County staff, which serves mostly at-home hospice patients. That staff would be moved to offices at the planned hospice center. The organization already operates a hospice center in Longview.
The organization has already hired contractor J.H. Kelly to build the center, Pang said.
Reasons for the urgency in the project are low real estate prices and interest rates, as well as a 14-month “tax holiday” approved by Clark County commissioners in October 2010 that waives many of the impact, inspection and application costs for the new center, he said.
The organization sends some of its patients to the Ray Hickey House as part of contract with PeaceHealth. When a Community Home Health & Hospice patient is placed at the Ray Hickey House, PeaceHealth receives the patient’s Medicare reimbursement.
Medicare reimburses at a rate of about $672 per day at an inpatient hospice center for patients who are terminally ill and have a prognosis of less than six months to live, according to the Centers for Medicare & Medicaid Services. The reimbursement rate for at-home hospice care is about $151.
Community Home Health & Hospice placed three Clark County patients in the Ray Hickey House in 2010, according to PeaceHealth. Berg said the Ray Hickey House has room for all of Community Home Health & Hospice patients who currently receive inpatient care.
In 2010, Community Home Health & Hospice served 291 Clark County patients on a total of 13,757 days, according to the organization’s statistics. Out of those numbers, 36 patients received care at an inpatient hospice center for a total of 147 days. Thirty-three of those patients were placed outside of Clark County.
The average daily occupancy in the hospital’s Ray Hickey House has remained at 80 percent or less since the 20-bed center opened in 2004, according to PeaceHealth statistics. Occupancy went down to 71 percent in 2010.
Berg said if Community Home Health & Hospice sent all of its patients who needed inpatient care to the Ray Hickey House, it would take up an average of half of a bed throughout the year. The hospice center currently has an average daily occupancy of less than 15, so the addition of half a patient would still leave an average of four and a half beds vacant, he said.
Clark County has more hospice beds per capita than the state average, Berg said. If Community Home Health & Hospice were to open a Vancouver hospice center, the county would have 300 percent more beds per capita than the state average, Berg said.
“If we had a five-person drop, it’d be a $850,000 hit to us,” Berg said. “Our biggest fear is both centers will be half empty, and neither one will be fiscally viable, and we close them both.”
Haskett has opened three hospice centers during her career.
“You have to have a full census to make ends meet, and you rely heavily on donations” Haskett said.
Haskett said another factor to consider is that people generally prefer to die at home if they can. The growth of adult family homes that offer hospice care represent another area of competition for both hospice centers, said Judy Canter, a Vancouver licensed social worker who specializes in disorders affecting the elderly.
Karen Nidermayer of the Department of Health said she couldn’t comment on the viability of the project. However, the agency is mainly concerned whether an organization has a wide enough customer base to provide 65 percent occupancy. The agency counts both patients who receive at-home services from the organization and those who receive inpatient care as part of the hospice center’s potential customer base, she said.
A decision on the application is expected in the spring, she said.
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