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Profit vs. Non-Profit Hospice … Is There a Difference?

Article submitted by Kari Scott, Community Outreach, Family Hospice and Family Hospice Foundation. For additional information regarding any questions you may have about hospice, please contact Family Hospice at 303-440-0205. Visit their website – www.FamilyHospice.net

Boulder, Colorado – When my mom’s friend was faced with the decision to put her husband on hospice due to his life limiting illness, I recall my mom saying that her friend would only use a non-profit hospice. Well I haven’t really thought about that memory until recently, when I began working for Family Hospice and I recalled this story and wondered, what is the difference between for profit and non-profit hospice organizations? As it turns out, not that much!

The Hospice Medicare Benefit is a highly regulated program and must follow the “Conditions of Participation”. These are very specific requirements that are monitored closely by Medicare and include, but are not limited to: physician services, nursing care, and medications specific to pain management, social work services, spiritual care, volunteer participation, and bereavement services. These are just the minimum requirements that they must meet although many hospices naturally exceed these expectations through voluntary and/or community-based efforts. An important fact to know is that approximately 90% of hospice patients are under Medicare; this should help you to understand why the Medicare Benefit is so integral to those providing and receiving hospice services.

Every hospice is paid a per diem, which is the dollar amount that Medicare has determined will cover essentially all of the expenses related to the management of the patient’s care. This dollar amount varies from state-to-state and within the counties of each state. Currently, in Boulder County, the per diem amount is approximately $150.00. This means that any hospice that operates in Boulder County is compensated the aforementioned approximate dollar amount regardless of whether they are for profit or non-profit.

Perhaps the most significant difference between a non-profit hospice and for profit hospice is that non-profits do not pay taxes. This is an exclusive quality of all non-profits no matter what the goals of that organization may be. A common misnomer is that “non-profit” means monies are not exchanged or that the non-profit organization is run by volunteers, donations, and grant money. While some of this is true, it is not completely true, as non-profits have employees that receive compensation. In the case of a non-profit hospice, Medicare pays them the exact same per diem that the for profit hospices receive. They are just not taxed on that money due to how their business is structured. The taxes that are assessed to the for profit hospices are paid to the county in which they are located; this money is then used to support local government, social programs, and special projects that benefit the community.

Another defining difference between the two may be that at the end of the fiscal year, the non-profit hospice cannot show any profit. That is not to say that they did not make any money over the course of the year; it is simply saying that they cannot show a profit on their books. So where does the left over money go? Well, that is up to the non-profit hospice organization and how they choose to allocate it. Quite often, they will donate their profits to the community for social improvements or special programs that they want to contribute to. This is similar to the for profit hospice organizations. The difference being that the money comes from taxes and is then distributed to programs via the local government. Many for profit hospices have a non-profit (501c 3) division commonly known as a Foundation within their organization. These foundations are set-up to collect in-kind donations, also known as memorial donations. At Family Hospice, these contributions go directly for the patients who have special needs such as help with heating bills, small household repairs, special equipment, and sometimes travel arrangements for out of town family members who could not otherwise afford to visit.

Each hospice must follow the guidelines that Medicare has designated, and each hospice is special in its own right. Beyond the Medicare criteria, every hospice has the freedom to do things in their own special way. For example, massage, comfort and therapeutic touch, Reiki, music and pet therapies are just some of the Complementary Therapies that Family Hospice has to offer. You may find different complementary services throughout the other hospices of Colorado. It is these special extras that make each hospice unique and establishes a personal fit to those that are entering hospice. It is indeed these special “extras” that may help a person when they are deciding which hospice is right for their loved one.

When you really look at the differences between for profit and non-profit hospice organizations, I believe you will see they are really aren’t so different. Hospices, regardless of how they are organized, are here to help people live their lives with dignity and in comfort. They want to help the patient as well as the family, their caregivers, and their physicians. All hospice organizations follow the Conditions of Participation, have wonderful and caring staff members, and are prone to giving back to their community.

The difference that really stands out is one of personal choice. When you are choosing the hospice that is right for you, finding the organization that has the personal touches that appeal to you may be the motivating factor that you would want to consider.

More about Family Hospice of Colorado

Family Hospice is a family owned and operated agency, based in Boulder Colorado. It was founded in 2005 by a local Boulder family who, nearing retirement, felt they still had something very important to do. Luther and Melody Stanton were very familiar with hospice services. Melody had been the Administrator for an independent living facility in Boulder for eight years and Luther, a financial planner with a major brokerage firm, had focused for many years on estate planning; helping seniors with financial decisions. However, he always felt he could be doing so much more. Over the years, Melody saw many of the residents at her facility with life limiting illnesses choose hospice services, which enabled them to remain where they were living and near their friends and family. The support, care and love Melody witnessed was life changing for her. Then their son Jerry Kopack, a business analyst with a finance degree from The University of Colorado, became a part of this very committed team, in order to "give back" to the community they love.

Their idea was not to re-invent the wheel, but instead to focus on the original purpose of hospice. Thirty years ago hospice started as a grassroots program dedicated to providing excellent end-of-life care through a personal holistic team approach. A "family of professional hospice caregivers" becomes a supportive care team for the patient and family. The name "Family Hospice" was a natural fit for this program. The next step was putting together a team of professional health-care providers who were not only the best but had the key ingredient of the program-the "hospice heart". The hospice heart is not something you can teach even the best professional, it is something one is born with. Their team of caring providers offers quality services to both patient and family.

Family Hospice is honored to be serving Gilpin County, Boulder County and the surrounding areas. Family Hospice has expanded to include rural mountain areas in Gilpin County such as Nederland and Coal Creek Canyon that were not being served by other hospice programs. The Family Hospice team lives here in the greater Boulder community and is readily available to provide services whenever the need arises. For additional information regarding any questions you may have about hospice, please contact Jerry Kopack, Melody Stanton, or Christine Lewis all of Family Hospice at 303-440-0205.
Website: www.FamilyHospice.net

© 2012, All Rights Reserved by Family Hospice and Family Hospice Foundation.

Posted December 2012 on www.SeniorsResourceGuide.com