Medicare Expenditures at End of Life in Patients with Advanced Dementia

Among older Americans, dementia is a leading cause of death. Five million adults had dementia in 2000, and estimates indicate that by 2050, the number of Americans with dementia will reach 13 million. Healthcare expenditures related to dementia were approximately $172 billion in 2010. According to researchers, the costs will rise as the number of people living to experience the end stage of dementia increases. Previous studies of costs associated with dementia have been conducted in the community setting and have not focused on end-stage disease; however, 70% of patients with dementia die in nursing homes. Medicare covers the costs of acute care, subacute care, physician and other provider services, hospice, prescription drugs, and diagnostic tests for Americans ≥65 years of age. Nursing home care is not covered by Medicare. After individuals exhaust their own resources, Medicaid covers care in nursing homes. Nursing home residents with advanced dementia may receive costly interventions of limited clinical benefit, including tube feeding and hospital transfer. Among patients with cancer, advance care planning has been shown to lower costs in the last weeks of life; lower costs have been associated with a higher-quality dying experience. Researchers recently conducted a study to describe and examine factors associated with Medicare expenditures in advanced dementia. They reported results in Archives of Internal Medicine [2011;171(9):824-830].

The study enrolled nursing home residents with dementia (n=323) in 22 facilities; participants were followed up for 18 months. Data on clinical and health services use, including Medicare expenditures, were collected every 90 days. The researchers used multivariate analyses to identify factors associated with total 90-day expenditures for all Medicare services and Medicare services excluding hospice. The participants’ mean age was 85.3 years, 85.5% were female, and 89.5% were white. The participants were required to have healthcare proxies (HCPs); mean age of the HCPs was 59.9 years, 63.8% were female, and 67.5% were children of the resident. During the study period, 54.8% (n=177) of the participants died. For the total cohort, the total mean expenditures were $8522 per resident and $2303 per 90 days. For hospitalizations, mean expenditures were $2570 per resident and $625 per 90 days (30.2% of Medicare expenditures). Emergency department visits accounted for the lowest proportion of all services (1.1%). Only 22.0% of the study participants received hospice services; however, hospice payments accounted for 45.6% of total Medicare expenditures, the largest proportion of services examined. Mean hospice length of stay was 122.0 days; mean spending was $3885 per resident and $1050 per 90 days.

Among the participants who died, mean Medicare expenditures increased by 65% in each of the last 4 quarters before death (P<.001), primarily due to an increase in expenditures for acute care and hospice care. Total mean Medicare expenditures increased as death approached: 0 to 90 days before death, $3877 (n=177); 91 to 120 days before death, $2297 (n=128); 121 to 270 days before death, $1605 (n=96); and 271 to 365 days before death, $1061 (n=68). Multivariate analyses were conducted to examine factors associated with 90-day expenditures in the total cohort. The 6 factors independently associated with higher total Medicare expenditures were younger age, not living in a special care dementia unit, a Test for Severe Impairment (TSI) score of 0, chronic obstructive lung disease, acute illness in the prior 90 days, and a belief by the HCP that the resident has <6 months to live. After excluding hospice from the total Medicare expenditures, factors independently associated with higher 90-day expenditures were younger age, not living in a special care dementia unit, a TSI score of 0, chronic obstructive lung disease, the presence of a percutaneous endoscopic gastrostomy tube, recent acute illness, and lack of a do-not-ospitalize order. Active cancer at baseline was associated with lower nonhospice Medicare expenditures. In conclusion, the researchers summarized their findings: “Medicare expenditures among nursing home residents with advanced dementia vary substantially. Hospitalizations and hospice account for most spending. Strategies that promote high-quality palliative care may shift expenditures away from aggressive treatments for these patients at the end of life.”