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The use and costs of Medicare services by cause of death
Insights
Medicare costs for dying patients vary significantly by cause of death. Cancer care was most expensive per person, but heart disease accounted for a larger portion of the total Medicare budget in 1979.
Area of Science:
- Health Economics
- Gerontology
- Public Health Policy
Background:
- Care for the dying presents significant financial and ethical challenges.
- Medicare beneficiaries in their final year of life represent over 25% of total Medicare expenditures.
- Understanding cost variations by cause of death is crucial for Medicare program evaluation.
Purpose of the Study:
- To analyze Medicare costs associated with end-of-life care based on the cause of death.
- To establish a baseline for evaluating future Medicare policy impacts on terminal care spending.
Main Methods:
- Analysis of Medicare expenditures for aged beneficiaries who died in 1979.
- Categorization of costs by leading causes of death.
Main Results:
- Significant variation in per capita Medicare expenses was observed across different causes of death.
- Cancer had the highest per capita cost ($8,021), followed by heart disease ($4,012).
- Despite higher per capita costs for cancer, heart disease decedents represented a larger share of the 1979 Medicare budget (8.2%) compared to cancer (7.2%) due to higher mortality rates.
Conclusions:
- End-of-life care costs within Medicare are highly dependent on the specific cause of death.
- These findings provide essential baseline data for assessing the financial implications of Medicare reforms on terminal care.
- Further research is needed to understand the drivers of these cost differentials.
Abstract:
The high costs and difficult ethical and medical issues often associated with care of the dying are of special interest to the Medicare program, because enrollees in their last year of life account for over one-fourth of total Medicare expenditures. In this study, we look at those costs by cause of death for aged Medicare beneficiaries who died in 1979. We found that expenditures varied markedly by cause of death. Cancer was the most expensive leading cause of death, with per capita expenses of $8,021, compared with $4,012 for heart disease. Because of the greater number of deaths from heart disease, expenses for heart disease decedents accounted for 8.2% of the total Medicare budget in 1979 compared with 7.2% for cancer. These data provide a baseline with which to evaluate the effects of major changes in Medicare on care for the dying.