It’s time to bring value-based care principles to hospice

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In the health care industry, the conversation around value-based care (VBC) has been abuzz for a while now. The idea is simple: pay for outcomes, not for services, and shift our mindset from volume to value as we reduce unnecessary care, improve outcomes and bend the cost curve. However, when we talk about VBC, we often overlook a critical part of the health care continuum: hospice care. And when it comes to end-of-life care, traditional measures like survival rates and reduced readmissions lose their relevance. Hospice embodies some of the deepest principles of VBC: aligning care with patient goals, avoiding unneeded interventions and supporting the person as a whole. Here’s what primary care physicians need to know about the integration of value-based principles in hospice care.

The current state of hospice

Asher Perzigian
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Hospice care is a vital service that provides comprehensive support to patients and their families during the final stages of life, prioritizing comfort, dignity and quality of life over curative treatments. It addresses physical, emotional and spiritual needs, offering a level of care that is both humane and necessary.

The challenges facing hospice care are numerous and daunting. Inconsistent care quality and access to care are two of the most pressing issues. The standard of care can vary widely from one hospice provider to another, with some offering exceptional support while others fall short. This inconsistency is a source of frustration for patients and families, who deserve the best possible care during a time when emotions are high and challenges are significant. Additionally, workforce shortages are a persistent problem. The demand for skilled nurses and other health care professionals is outpacing supply, with the added emotional burden facing our hospice clinicians, leaving many patients and their families with limited options.

Similarly, the industry continues to explore value-driven payment and reimbursement models. The Hospice Benefit Component of the Centers for Medicare & Medicaid Services (CMS) Value-Based Insurance Design (VBID) Model aimed to integrate hospice care into Medicare Advantage (MA) plans, aligning care and cost-sharing responsibilities. Historically, when a patient elected hospice, traditional Medicare assumed most financial responsibility, while MA plans retained limited accountability — often leading to fragmented care and oversight. However, CMS terminated the Component at the end of December 2024 due to limited participation, operational challenges and unmanageable costs. CMS continues to assess ways to improve quality, safety and care coordination at the end of life.

Why VBC matters in hospice

VBC principles have the potential to transform how we think about and deliver hospice care. The definition of value must expand from only traditional clinical outcomes to include goal-concordant outcomes that are patient-defined and representative of what matters most to the patient. For hospice, “success” isn’t curative but is instead about providing patients with care that aligns with what they want and reflects their values and preferences.

By aligning financial incentives with high-value care and patient-driven outcomes, VBC can ensure that hospice providers are rewarded for delivering high-quality, compassionate care. This shift from fee-for-service to value-based payment models can help address the variability in care quality that currently exists in the system, incentivizing earlier palliative care, smoother care transitions and higher-value outcomes.

Integrating hospice into the full continuum of care is a crucial first step. Hospice should not be seen as a separate entity but as an integral part of health care that needs to be discussed and planned for alongside other aspects of care. Education should be available to patients and families in a proactive manner, helping them gather the necessary information to make critical end-of-life decisions. This can include working closely with primary care physicians, specialists, palliative care teams and other health care professionals to develop comprehensive care plans and initiate difficult conversations about a patient’s end-of-life goals earlier in their care journey. Filling gaps in the continuum by providing support services such as grief counseling and resources for caregivers can also improve overall care quality.

Empowering patients, caregivers and providers

One of the key principles of VBC is patient empowerment. Patients and caregivers should be a core part of the care planning process and included in the difficult conversations. By involving them in decision-making, we can ensure that patients are able to voice their preferences and needs, and families and caregivers can ensure the patient’s desires are honored. This also ensures care is tailored to their unique needs and preferences, helping avoid unneeded treatment. This can lead to goal-concordant outcomes and higher satisfaction. This approach not only improves care but also helps to reduce the overall cost of care by focusing on what truly matters to the patient.

We also need to empower the entire care team — primary care physicians and beyond. Hospice and end-of-life care is unique compared with other types of health care, and the care that these clinicians give can be emotionally taxing. Advanced practice providers (APPs) such as nurse practitioners and physician assistants can play a crucial role in expanding access to care and bearing some of the emotional and administrative burden on primary care physicians. By formalizing the role of APPs in VBC attribution, we can create a more collaborative and value-conscious care model. This can help address the primary care labor shortage and ensure that patients receive the care they need in a timely manner.

Technology as a solution

Technology has the potential to be a game changer in bringing VBC to hospice care. New digital solutions can streamline administrative tasks, freeing up time for nurses and care teams to focus on patient care and comfort. One promising solution is the use of generative artificial intelligence (AI) as a clinical copilot. Generative AI can provide briefings to physicians on patient histories, clinical research and diagnostic options, as well as interface with patients to complete more transactional tasks.

Technology can also be used to improve the efficiency of care teams. For example, patient precheck tools can transfer key information to the office before an appointment, raising important details to the provider in advance, such as already iterated patient values or potential misalignment identified between patients and their caregivers and families. This can help providers be more prepared and focused during patient interactions, leading to better decision-making aligned with patient goals. And of course, telehealth services and advanced data analytics can help providers better understand and meet patient needs, tailoring care plans more effectively and enabling difficult conversations more readily.

Standardization and collaboration

To truly succeed in VBC, we need to address the lack of standardization in hospice care. Standardizing and streamlining VBC contracting strategies can help ensure that programs reach their quality goals. For example, a framework that focuses on transparency, stability and control can help stakeholders consider how these factors impact the overall contract and increase the likelihood of a positive return on investment. Collaboration among hospice providers, as well as with providers of palliative, specialty and primary care is also essential. By forming consortiums and partnerships, organizations can achieve economies of scale, improve care coordination, enhance their ability to meet patient needs, and reduce unnecessary interventions and hospitalizations. This model has proven successful in other areas of health care, such as federally qualified health centers and accountable care organizations. Together, organizations can advocate for policy changes that support the advancement of high-quality hospice care, including better insurance coverage and funding for hospice services.

Furthermore, building on the lessons learned from the Hospice Benefit Component of VBID, a future payment model should focus on standardizing care delivery expectations and aligning financial incentives across payers and providers. Rather than relying on voluntary, fragmented participation, collaboration across industry stakeholders can drive hospice payment reform that emphasizes value-driven metrics, shared accountability and interoperability across tech and innovation. This type of model supports earlier, more coordinated transitions to palliative and hospice care, direct contracting with hospice networks and inclusion of community-based interventions, ensuring patient-centered care delivery within the broader VBC ecosystem.

The way forward

As our population ages and the demand for hospice care grows, we need to ensure that this vital service meets the highest standards. Applying VBC principles can help. By integrating hospice into the full continuum of care and investing in innovative tools, we can address workforce shortages, improve care quality and access, and set the stage for a more compassionate and effective health care system.

Elizabeth Annis from Accenture also contributed to this article.

Asher Perzigian is a managing director and North America care innovation practice lead for Accenture Health and a recognized leader in commercializing and scaling innovative business transformation programs. He has worked with some of the leading health care providers, payers, vendors and life sciences organizations in North America, and is responsible for Accenture’s relationship with one of the firm’s largest and most complex provider and care delivery clients. He is cohost of the Mavericks in Healthcare: Chronicles of Innovation Podcast Series.