"The High Cost of Dying" Revisited

Abstract

In this article, I shall discuss what we have learned in the past decade or so about medical care use and costs at the end of life. In particular, I shall discuss what we know about the characteristics of decedents with especially high costs. There are few data on costs at the end of life for persons under 65 years in the United States, largely because -- unlike the elderly -- they are not covered by a single health insurance program that makes the collection of data comparatively simple. As a result, most of the data I shall present are limited to the elderly and, in addition, refer to Medicare services only. The fact that they are limited to the elderly is not too serious a problem because just over 70 percent of all deaths in a given year are persons 65 years and older. The fact that they refer only to services paid for by Medicare is a more serious limitation because Medicare covers primarily inpatient hospital care and physician services while paying only a small fraction of nursing-home costs, a limited amount of home health care costs, and nothing for drugs. In 1987, for example, Medicare paid for 69.7 percent of the elderly's expenses for hospital care, 60.6 percent of their expenses for physician services, only 1.7 percent of their nursing-home costs, and 14.7 percent of their costs for other personal health care. Overall, it paid for 44.6 percent of the elderly's total personal health care expenditures. These limitations should be borne in mind when evaluating the data that follow.