Jonathan Fleece, a prominent health care attorney, speaker, author and most recently, hospice executive, didn’t expect to get emotional on a tour of a durable medical equipment warehouse.
But sometime last year, while standing in such a building in Clearwater, Fleece, president of hospice organization Empath Health, broke down a bit. Not just at the sight of hospital beds and other gear. But at the notes some youth volunteers had written about the equipment. The letters were short passages of appreciation for the people who would soon be getting the beds — patients at some level of end-of-life care. “This is hard for people but that’s the direct kind of care we provide,” he says. “It hit me emotionally to be there.”
The emotional side of hospice care, what Fleece witnessed, is also the public-facing side, as families say goodbye to loved ones, many times in heart-wrenching situations. Behind the scenes, meanwhile, the hospice industry is a big business. It’s filled with a host of challenges and obstacles, ranging from government regulations, declining reimbursement rates, increased competition and consolidation trends, hiring and staffing needs, and, of course, in the past two years, COVID-19. Multiple hospices, both for-profits and nonprofits, have merged or sold to private equity firms in recent years, while others sought to expand services and find new revenue streams.
'I wanted to make a meaningful impact in the way people live and in the way they die.’ Rafael Sciullo, Empath Health
Empath Health, parent of Suncoast Hospice, took the merger route in joining with Fleece’s former organization, Stratum Health System, the parent entity of Sarasota-based Tidewell Hospice. The merger, which celebrated its one-year anniversary in March, was a seismic move in the hospice world. Under the Empath Health brand, it created a nonprofit hospice giant, with 2,500 employees that sees and treats some 14,000 people a day. The combined organization has annual revenue of $351 million.
The timing could be spot on for Empath to take a bigger-is-better strategy. Florida, with its fast-growing but also aging population, has a big need for hospice care. (Hospice care is traditionally defined as care that focuses on easing a terminally ill patients’ pain and suffering; also know as palliative care, the goal is quality of life and comfort, as opposed to a cure or return to health.) Florida, according to the National Hospice & Palliative Care Organization, had a hospice utilization rate of 57.9% of Medicare clients in 2018. That’s the fourth-highest rate in the country, slightly behind Utah, Delaware and Arizona.
On a national scale, the U.S. hospice market was valued at $32.1 billion in 2021, according to a new report from Grand View Research. The research firm projects the industry will grow at a compound annual growth rate of 8.20% through 2030. “The rising geriatric population coupled with the increasing prevalence of chronic as well as age-associated diseases is anticipated to boost the market growth,” the report states.
Empath executives see the same trend lines — both in seeing more people and in providing more services for the people and families the organization sees. “The purpose of Empath is to be a full life care provider,” says Empath CEO Rafael Sciullo, 69.
“We are in a unique position,” adds Fleece, 54, pointing to Empath’s size. “There are a lot of organizations that can’t provide all the services we can.”
Multitude of issues
One of the closest organizations, in size and geography, to Empath Health is Hope Hospice in Fort Myers. Over 30 years, Hope CEO Samira Beckwith has helped grow the organization from seeing 100 patients a day to a census of some 4,000 people a day. Hope offers hospice, palliative and pediatric care, in addition to a Parkinson’s disease program Beckwith says is pioneering in the industry. Like Empath and Tidewell, Hope Hospice, says Beckwith, follows the need. “We might’ve stayed as a hospice,” she says, “but we came to understand the community had a lot of gaps in services.”
In addition to being a prominent advocate for hospice care in Southwest Florida, Beckwith is a national voice for the industry. She’s served on and chaired numerous boards, including recently being named chairwoman of the National Partnership for Healthcare and Hospice Innovation. She’s also spoken before both chambers of the U.S. Congress on hospice rules, regulations and payment structures, among other issues.
The biggest challenge in hospice care, Beckwith says, has historically been “where we fit in the continuum of care,” among the entire health care landscape. That lack of clarity, she says, has led the public to sometimes, if not often, misunderstand a hospice’s mission, that it’s just for the last week or 10 days of someone’s life. “I don’t even consider hospice end of life care,” she says. “It’s more like last year of life care.”
That ambiguity stretches, notably, to government regulations, both in Florida and nationally, says Beckwith. In general, Beckwith says the federal government tends to overreach in regard to health care, and hospices are both “over-regulated and inappropriately regulated.”
She specifically cites the Centers for Medicare and Medicaid Services, the federal agency that sets reimbursement rates hospices get for providing hospice care. While the federal agency recently proposed a 2.7% pay increase in the rate for fiscal 2023, that comes after several years of slashing payments. In addition, Beckwith says the agency’s new move to go toward what it calls value-based care could not only keep rates low, but also continue a misunderstanding of the intricate value of a hospice. “CMS demos and models have changed so much over the years,” Beckwith says. “That’s very frustrating.”
Hospices, Beckwith says, also faced some of the dramatic cost increases seen across health care during the pandemic. In the early days that included buying more PPE and COVID-19 testing kits, and later, investing in telehealth. More recently, rising wages in a tight labor market and inflation have squeezed margins even further.
Piece of the pie
Empath executives embrace these challenges.
The organization uses a 10-point care navigation circle, what it calls the wheel of access, as a guide to encompass everything it does. On a PDF, the circle is broken down into pie wedges, with each one a slice of what Empath provides.
The circle includes the expected: a variety of hospice services, under Suncoast Hospice, Suncoast Hospice of Hillsborough and Tidewell, ranging from crisis care to six to 12 month supportive care to pediatric care. There’s also a pie wedge for grief and community counseling and perinatal loss doula services.
Then there’s the unexpected. Those run from sexual health services to home health care to adult day care centers. Another pie wedge is for support, which includes durable medical equipment, infusion services, integrative medicine and pharmacy.
Empath does this in 14 Florida counties, including Pinellas, Hillsborough, Pasco, Manatee, Sarasota, Charlotte, Lee and Collier. In some counties, it provides home health private duty home health services, but not hospice care. In addition, earlier this year Empath received Florida Agency for Health Care Administration approval to deliver hospice care services in Hardee, Highlands and Polk counties. That addition is on hold, an Empath spokeswoman says, as entities that weren't approved for the expansion appeal AHCA's decision.
The merger goes back at least six years, when Sciullo and Fleece, then on the boards of Empath and Tidewell, respectively, met each other. Both shared a passion for using technology advances to keep their organizations ahead of health care trends. Fleece, who, in 2011, co-wrote a book with Sarasota-based futurist David Houle, “The New Health Age: The Future of Healthcare in America,” was talking up telemedicine long before the pandemic, for example.
“It was pretty clear we had the same vision for what hospices could be,” Sciullo says.
The pair chatted about a merger back then, in 2016, but the timing was off. By 2019 Fleece was president and CEO of Tidewell, after he left Blalock Walters, where he’d been CEO and managing partner of the Bradenton-based law firm for seven years. The timing for a merger was better. Sciullo, for one, was looking toward retiring in 2023. He sought a visionary successor — and saw that in Fleece. “I wanted to make a meaningful impact in the way people live and in the way they die,” he says, “and so did Jonathan.”
The pair spent an afternoon hammering out what the organizations would look like together. “There was a real need to look at succession plans,” Sciullo says. “It wasn’t just a matter of me but looking at the whole organization. We are a mission-based organization. We don’t want to grow for growth’s sake. We want to create access for more people to have more access to our services.”
Call to action
Access to better palliative care is the core of founding principles of both Suncoast and Tidewell. Suncoast got its start in a one-bedroom bungalow in Largo in 1977, when some community residents volunteered together, aiming to improve end-of-life care for people and their families. Mary Jean Etten was one of those initial founders, and she volunteered for Suncoast for decades. Tidewell, with a similar call to action, was founded in 1980 in a rented room inside Sarasota Memorial Hospital. It had one paid employee, a nurse.
With that history and sense of purpose as Empath’s North Star, Fleece — while not immune to outside forces, like competition, reimbursement rates and regulations — goes internal when contemplating his biggest up-at-night worries. For that, he’s constantly thinking about three things for the Empath employees: their mental health, their physical wellness and the widespread economic pressures (rent, for one) many are facing in health care.
“We are constantly doing everything we can to support our people,” Fleece says. “One of the things I worry about is (are) we doing enough to help our people through these challenging times?”