Employers See Palliative Care as Option to Cut Health Costs

When George Schwartz’s late wife was diagnosed with advanced lung cancer in 2002, he faced the task of managing her care while working as a financial advisor in a small brokerage firm.

He accompanied her to appointments, researched treatment options, coordinated her care and struggled to manage the fears that came with the dire diagnosis.

The experience was both physically and emotionally draining. It wasn’t until the couple turned to palliative medicine, a fairly new subspecialty recognized by the American Board of Medical Specialties in 2007 that helps patients manage serious illnesses, that the load became bearable, he recalled.

“It provided us relief from anxiety, starting with a clear explanation of the course of the disease, what end of life would be like and how a palliative care doctor would deal with her deteriorating health,” said Schwartz, 66, whose firm, Gilbert, Doniger & Co., is based in New York. “I had a lot of interaction with the health care system and I hadn’t heard of it. My wife found out about it in a magazine article.”Palliative medicine, which is practiced by specially trained doctors, nurses and other health care professionals, provides care for patients with life-limiting conditions such as cancer, advanced heart disease, dementia, and kidney failure, among others. The goal of palliative care is to improve quality of life through pain management, stress relief, treatment for fatigue and depression, and by offering support for caregivers.

It is also associated with lower health care costs and better outcomes for patients and their caregivers, who are vulnerable to stress and illness, according to Lea Tessitore, a researcher with Catalyst for Payment Reform, a nonprofit organization that works on behalf of large employers.

“Cost savings can come in a variety of ways,” she said. “If you lead with a focus on quality of life then cost reductions will follow. For example, having a conversation around the goals of care with a provider can help to avoid aggressive and potentially harmful treatment that isn’t necessary.”

In September, CPR and the Center to Advance Palliative Care released a guide to help employers develop a palliative care strategy and educate them on what it is and how it can help patients and caregivers. Tessitore said that it could also help employers approach a topic that can be difficult to talk about.

“Many people think that palliative care is synonymous with hospice care and that creates a barrier to having these conversations,” she said. “They think that this is the type of care I get when I’m ready to give up. But palliative care is a high-value way to make an impact on the lives of employees with serious illness and their caregivers. It can improve the quality of life and it can reduce costs.”

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It is associated with shorter hospital stays and lower health care costs due to a decreased need for 911 calls, emergency room visits, hospitalizations and the elimination of costly and ineffective treatments. In fact, patients with serious illnesses who received palliative care saved an average of $3,237 over the course of a hospital stay compared to patients who did not receive it, according to a study published in JAMA Internal Medicine in 2018.

These costs savings are catching the eye of employers, who recognize that while just a small fraction of employees have serious illnesses, most of their health care dollars are going toward their treatment, according to Allison Silvers, vice president of payment and policy at the Center to Advance Palliative Care.

“About 2 percent of the commercial population is facing a serious illness and the care they get is often avoidable. … That percentage sounds tiny but it’s where employers are spending most of their money.”

One employer who recognized the costly gaps in care for seriously ill patients is Dow Chemical, which worked with insurance giant Aetna to launch a hospice program in 2004 that allows patients to pursue treatment through palliative care. Typically, insurers will not cover hospice care if the patient continues to seek “curative treatment,” said Silvers. Dow is featured in the CPR toolkit.

She hopes that more employers will see the potential of palliative care to improve the lives of employees with serious illnesses.

“We really want purchasers to demand from their health plans that they make palliative care available to participants,” she said. “We’re hoping to drive demand. It’s not a hard thing for health plans to do, but they don’t have much impetus. Employers need to demand this.”