Some hospice care is for profit

Iowa City Hospice has faithfully served Eastern Iowa for 40 years. Founded by volunteers and growing along with our community, Iowa City Hospice has exemplified what is best about Iowa: neighbors serving neighbors with dignity and compassion. As a nonprofit organization, Iowa City Hospice turns no one away from hospice care due to inability to pay, and reinvests every dollar earned into staff support, patient care, and innovative new services.

Iowa City Hospice, and all nonprofit hospices, face a new challenge: the prevalence of for-profit corporations in hospice care. A recent Rand Corporation study showed “the proportion of hospices that are for-profit increased from 30 percent of all hospices in 2000 to 73 percent in 2020.” Sales and mergers of hospice companies continue to set records, and the proportion of for-profit hospices is now estimated as high as 90 percent nationwide.

Patients and families considering hospice care may not realize that so many hospices focus on profit rather than patient care. In 2019 the National Partnership for Health Care and Hospice Innovation partnered with Milliman, a global actuarial and consultant firm, to study the differences between for-profit and nonprofit hospice services. For-profit hospices spend 300 percent more on marketing efforts than nonprofit hospices. Nonprofit hospices provide patients with 10 percent more nursing visits, 35 percent more social worker visits, and twice as many therapy visits.

Nationally, for-profit hospices have a 20 percent profit margin, while nonprofits clear about 5 percent. Simply put, this means that nonprofits are pouring over four times more revenue back into patient care, staff support, and community service.

Certainly not all for-profit hospices are bad, and nonprofit hospices can fall short of expectations. However, the difference in missions is stark. The goal of a corporation is to make money and provide returns to investors. The mission of Iowa City Hospice is “to provide compassionate care for anyone in our community affected by serious advanced illness and end-of-life conditions.”

If patients and families wish to be served by a local nonprofit with 40 years of honorable history, and one that continually reinvests in the community, they need to ask for Iowa City Hospice by name. I will. I am proud to be a member of the all-volunteer, all-local board of directors that governs Iowa City Hospice.

Cathy Pugh is board president of Iowa City Hospice.