Medicare Beneficiaries’ Costs Of Care In The Last Year Of Life

TLDR

About one‑quarter of Medicare spending occurs in the last year of life, unchanged for two decades, and reflects care for multiple severe illnesses common near death. This paper profiles Medicare beneficiaries’ costs for care in the last year of life. The authors analyze Medicare claims data to profile costs in the last year of life. Thirty‑eight percent of beneficiaries had a nursing‑home stay in the year before death, hospice is used by half of cancer decedents and 19 % overall, and African Americans incur markedly higher end‑of‑life costs than other groups, contrary to their usual lower spending.

Abstract

This paper profiles Medicare beneficiaries’ costs for care in the last year of life. About one-quarter of Medicare outlays are for the last year of life, unchanged from twenty years ago. Costs reflect care for multiple severe illnesses typically present near death. Thirty-eight percent of beneficiaries have some nursing home stay in the year of their death; hospice is now used by half of Medicare cancer decedents and 19 percent of Medicare decedents overall. African Americans have much higher end-of-life costs than others have, an unexpected finding in light of their generally lower health care spending.