Hospice Staffing: What Financial Reports Don't Tell Us About Quality of Care

Hospice organizations report financial information that provides insight into how resources are allocated. But how much can those numbers tell us about an organization's actual capacity to deliver care?
A study published in Health Affairs, examining spending across different hospice ownership models, raises an important question about the relationship between financial reporting, staffing, and quality of care.

The researchers found that nonprofit hospices spent approximately 20% more on direct patient care than for-profit hospices, with much of the difference attributable to nursing salaries. The study also found that private equity-owned hospices reported the highest profit margins.
These findings are interesting, but another issue raised during the discussion of the research may have broader implications for hospice administrators: the limitations of the staffing information currently available for evaluating hospice organizations.

Spending Is Not the Same as Staffing

Medicare hospice cost reports provide information about organizational expenses, including salaries and other operating costs. However, financial expenditures do not necessarily tell us how many nurses, home health aides, social workers, and chaplains are available to provide care.

Salary expenses can serve as a proxy for staffing, but they do not provide a complete picture of workforce capacity.

For example, two hospice organizations might report similar nursing salary expenses while having very different staffing arrangements, patient censuses, geographic coverage areas, and operational demands. One organization may employ a larger number of part-time clinicians, while another relies on fewer full-time employees or contract personnel. Their financial reports alone cannot explain these differences.
This distinction is important when evaluating hospice quality. An organization's staffing capacity affects its ability to deliver timely visits, respond to changing patient needs, provide support to caregivers, and maintain continuity of care.

Why Staffing Matters to Quality

Hospice care depends on an interdisciplinary team responding to the physical, emotional, psychosocial, and spiritual needs of patients and families. Adequate staffing is important not simply because organizations need to meet regulatory requirements, but because workforce capacity affects what happens in practice.

Consider the ability to respond when a patient's condition changes, provide additional nursing support during a period of symptom escalation, or ensure that families receive assistance when they need it. Staffing also affects whether social workers and chaplains have sufficient capacity to address the emotional, psychosocial, and spiritual needs of patients and families.

These are not merely staffing questions. They are operational considerations that directly affect the delivery of hospice services.
CMS already incorporates several care delivery and patient experience measures into the Hospice Quality Reporting Program (HQRP). These include the Hospice Visits in the Last Days of Life measure, which evaluates whether patients receive visits from a registered nurse or medical social worker during at least two of their final three days of life.

The program also incorporates the CAHPS Hospice Survey, which captures family caregivers' experiences with communication, timely assistance, symptom management, and other aspects of hospice care.
Research has also examined the relationship between professional staff visits near the end of life and patient and family experiences. A study published in the Journal of Pain and Symptom Management found that hospices with higher proportions of professional staff visits in the final days of life tended to have better scores across several CAHPS measures.

These measures provide important information about care delivery and patient experience. However, they do not independently tell us whether an organization has sufficient staffing capacity across all disciplines to meet the needs of its entire patient population.

What Hospice Administrators Should Be Measuring

Hospice leaders should understand their organization's staffing capacity beyond what appears on a Medicare cost report.
That means looking at actual staffing levels by discipline, full-time equivalents, caseload distribution, and the relationship between staffing and patient census. It also means understanding how geography, travel time, patient acuity, and the location of patients affect the organization's ability to provide care.

For example, an organization serving patients across a large rural area may face very different staffing demands from one serving patients concentrated in a single geographic market. Similarly, an organization with a significant nursing facility census may have different scheduling and travel requirements from one whose patients primarily receive care in private residences.
Leaders should also examine visit frequency and consistency, missed or delayed visits, after-hours response capacity, staffing vacancies, turnover, and reliance on contract personnel. These operational indicators can help identify gaps that financial reports alone may not reveal.

Importantly, staffing numbers should not be evaluated in isolation. A simple staff-to-patient ratio does not necessarily reflect whether an organization can meet its patients' needs. The mix of disciplines, patient acuity, geography, length of service, and availability of staff all contribute to the overall picture.

The Limitations of Current Quality and Staffing Data

The Health Affairs discussion raises a broader policy question: should hospice organizations be required to report more detailed staffing information?

The researcher noted that current cost-report data provide limited insight into the actual number of nurses, aides, social workers, and chaplains working within hospice organizations. Salary expenditures are an imperfect substitute for more direct workforce information.
There is also a difference between measuring quality outcomes and understanding the resources available to produce them. CMS quality reporting provides information about specific care processes and patient experiences, but these measures do not constitute a comprehensive accounting of an organization's workforce.

Earlier research has also explored differences in hospice staffing patterns across ownership models. For example, a study published in the Journal of Palliative Medicine examined differences in interdisciplinary staffing among for-profit and nonprofit hospices. The findings illustrate why workforce composition deserves attention alongside overall spending. See this paper for an additional interesting study on hospice agency characteristics and quality of care.
More detailed and consistent staffing reporting could provide regulators, researchers, and consumers with a better understanding of how hospice organizations are structured and how workforce resources relate to care delivery.

Looking Beyond the Financial Statements

Financial performance is an important measure of organizational health, but it is not a substitute for understanding operational performance or quality of care.

Hospice leaders need to know not only how much their organizations spend, but what those expenditures support and whether available resources translate into the care patients and families need.

The Health Affairs research highlights differences in spending and profitability across hospice ownership models. Its discussion also raises an important consideration for the broader industry: financial reports can tell us where money goes, but they cannot fully explain the workforce behind those numbers.

For hospice administrators, understanding staffing capacity should be part of routine operational oversight, quality assessment, and organizational planning.

Ultimately, the question is not simply how much an organization spends on staffing. It is whether the organization has the right people, with the right skills and availability, to provide the care its patients need.