Conversations on Death: Cost Implications of End-of-Life Preparations
ABSTRACTThe end of a person's life is important. Sacred, even. But, more and more the end of life is also expensive--very expensive--for patients and for the taxpayer. According to the Dartmouth Atlas of Health Care, "patients with chronic illness in their last two years of life account for about 32% of total Medicare spending." As a result, there is a critical need to better understand effective solutions for reducing those costs. This paper focuses on the effect of living wills on total medical expenditures and utilization of heroic medical interventions at end-of-life.Using data pooled from the 2002 - 2008 exit surveys of the Health and Retirement Study, this paper uses logistic, regression and simulation models to evaluate the cost and care effects of three different types of living wills - those that call for comfort care only, those that call for limited care in certain situations, and those that call for receiving all care possible at end of life.The findings of this analysis indicate that patient preferences as expressed through living wills do, in fact, influence end-of-life medical expenditures as well as utilization of certain types of heroic end-of-life care. Of those patients who faced health care decisions in the final days of life, individuals who had living wills to limit care in some way had significantly lower total medical expenditures in the last two years of life, ranging from $2,730 (7%) (limited care or withheld treatments) to $8,285 (21%) (comfort care only) lower than their counterparts who did not have a living will. Conversely, those with living wills to receive all care possible had drastically ($24,171) (60%) higher end-of-life costs, as well as a 37 percent higher probability of utilizing life support, compared with those who had no living will.
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