Determinants of Medical Expenditures in the Last 6 Months of Life

BACKGROUND: End-of-life medical expenditures exceed costs of care during other years, vary across regions, and are likely to be unsustainable. Identifying determinants of expenditure variation may reveal opportunities for reducing costs. OBJECTIVE: To identify patient-level determinants of Medicare expenditures at the end of life and to determine the contributions of these factors to expenditure variation while accounting for regional characteristics. It was hypothesized that race or ethnicity, social support, and functional status are independently associated with treatment intensity and controlling for regional characteristics, and that individual characteristics account for a substantial proportion of expenditure variation. DESIGN: Using data from the Health and Retirement Study, Medicare claims, and The Dartmouth Atlas of Health Care, relationships were modeled between expenditures and patient and regional characteristics. SETTING: United States, 2000 to 2006. PARTICIPANTS: 2394 Health and Retirement Study decedents aged 65.5 years or older. MEASUREMENTS: Medicare expenditures in the last 6 months of life were estimated in a series of 2-level multivariable regression models that included patient, regional, and patient and regional characteristics. RESULTS: Decline in function (rate ratio RR, 1.64 95% CI, 1.46 to 1.83); Hispanic ethnicity (RR, 1.50 CI, 1.22 to 1.85); black race (RR, 1.43 CI, 1.25 to 1.64); and certain chronic diseases, including diabetes (RR, 1.16 CI, 1.06 to 1.27), were associated with higher expenditures. Nearby family (RR, 0.90 CI, 0.82 to 0.98) and dementia (RR, 0.78 CI, 0.71 to 0.87]) were associated with lower expenditures, and advance care planning had no association. Regional characteristics, including end-of-life practice patterns (RR, 1.09 CI, 1.06 to 1.14) and hospital beds per capita (RR, 1.01 CI, 1.00 to 1.02), were associated with higher expenditures. Patient characteristics explained 10% of overall variance and retained statistically significant relationships with expenditures after regional characteristics were controlled for. LIMITATION: The study limitations include the decedent sample, proxy informants, and a large proportion of unexplained variation. CONCLUSION: Patient characteristics, such as functional decline, race or ethnicity, chronic disease, and nearby family, are important determinants of expenditures at the end of life, independent of regional characteristics. PRIMARY FUNDING SOURCE: The Brookdale Foundation.