Death and Profits

When Hugh Westbrook pioneered hospice care, his organization saw to the needs of the dying. Fifteen years later nothing has changed -- except the politics and the profit margins.

Helping Westbrook was Don Gaetz. The two men were opposites in many regards. Westbrook was an ordained Methodist minister whose clerical assignments had introduced him to cancer wards and inner-city poverty. He had taught and read scripture at York Memorial United Methodist Church on North Miami Beach. He was a Democrat. Gaetz was a Republican who had worked several years as an aide to two United States senators before becoming vice president of a chain of hospitals in Florida.

Hospice was virtually the only common ground they shared. Gaetz had tried to form programs in Wisconsin and in Jacksonville, Florida, and soon after meeting Westbrook and Colliflower, he quit his job to work with the two Miami hospice pioneers.

Building on what he had already accomplished in the Florida legislature, Westbrook, along with Gaetz, began piecing together a bill that would provide Medicare reimbursement for hospices. Florida's legendary congressman Claude Pepper was an obvious and early supporter. "But the real person who got behind us was a congressman from California named Leon Panetta," Westbrook says.

By 1982 a Medicare funding bill that reflected Westbrook's ideas was in both the House and the Senate. Then the Congressional Budget Office reported that the recently completed experiment showed that hospices would likely save $110 million in federal tax dollars over three years. "When that report came out, everyone jumped onboard," says Westbrook. "Two-thirds of the Senate and two-thirds of the House signed on as co-sponsors of the bill." It passed in August 1982 and has been amended and expanded several times since. "That bill allowed hospices to become a reality," Westbrook continues. "It was the only expansion of the Medicare program during the Reagan administration."

Westbrook's ascent to a position of influence within the Democratic Party is understandable in light of these early days of the hospice movement. He was the young, affable minister, the humanitarian who sought only to find some way to help the terminally ill. And many of the politicians he befriended were still in the infancy of their careers. Today, for example, Graham is a United States Senator, Meek is the first black member of Congress from Florida since Reconstruction, and Leon Panetta has moved from California congressman and Westbrook supporter to the powerful position of budget director for the Clinton White House. So it's no surprise that not long ago Westbrook served on a panel with Hillary Clinton, and more recently received a personal briefing on the administration's health-care proposals at the Old Executive Office Building.

The fact that Westbrook is now wealthy has simply added clout to his connections. In the last few years, he has steered hundreds of thousands of dollars to federal congressional and presidential campaigns. In 1992, for instance, Westbrook and his key executives, family members, and various corporations contributed at least $470,000 to federal candidates, according to election records. Using this informal political action committee, Westbrook directed nearly $50,000 to his old friend Carrie Meek. Sen. Bob Graham received more than $18,000.

After shepherding the Florida licensing law and then the Medicare funding law through the political maze, Westbrook in 1982 created the Miami-based Hospice Foundation, a nonprofit organization that would help raise money to support his two nonprofit hospices in Dade and Broward. But Westbrook nurtured a dream that was bigger than South Florida. He wanted to build a national chain of nonprofit hospices, and that would require more money than his newly formed foundation could collect.

Initially, Westbrook and Don Gaetz say, they solicited grants and sponsorship from large foundations. They even tried to borrow money from local banks. But no one was willing to lend to a nonprofit company. So in January 1984, the two men, along with Esther Colliflower, formed Hospice Care Inc. (HCI), a for-profit company hoping to attract investors to open a chain of hospices. (Outside Florida, of course, where profit-making hospices were still prohibited.) "We backed into the idea of establishing a for-profit organization because of necessity," Gaetz says.

Not everyone in the traditionally nonprofit hospice movement was understanding, however. In 1982, when the Medicare laws were being expanded to include hospices, Gaetz served on the board of directors of the National Hospice Organization A the trade association representing about 80 percent of all hospices in the U.S. He had gone on to become the group's president and chairman. But in 1984, when Westbrook, Colliflower, and Gaetz formed HCI, a battle erupted on the board. "People felt betrayed," recalls Claire Tehan, who runs a nonprofit hospice in Southern California and who was a member of National Hospice Organization's board in the mid-1980s. "Here Don and Hugh had been saying we need the Medicare benefit in the name of taking care of dying patients, and then in the next breath they created a for-profit company. There were a lot of people upset with how quickly they moved to become a for-profit. They are very sharp businessmen and politicians. I've learned a lot from them, I really have, although I wouldn't want to follow in their footsteps." Gaetz soon resigned from the board and devoted his energies to promoting HCI.

But even with the company's for-profit status, investors proved elusive. Westbrook and Gaetz say they turned down a number of offers from people who were willing to provide the money, but only on condition they not squander resources on charity care for those not covered by Medicare or Medicaid (the medical program for those living in poverty).

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