I am currently knitting a prayer shawl for our local hospice. We have a Sip n Stitch group at our church (they knit, crotchet or quilt together - they meet on Mondays, which means I can't make it, but I borrow their knitting patterns often
)...and they found out that the local hospice is desperate for this kind of thing.
Many of the people in hospices are there because they don't have family or have been abandoned by theirs (not all, but a significant percentage). They are desperate for any show of love.
One of the nurses said that many of her patients ask to wear their shawls when they are dying...it makes them feel like they mattered to someone.
The prayer shawls are not neccessarily connected with any relious association...it's just the name of the pattern.
I am working on an all cream one now.