The High Cost of End-of-Life Healthcare – Myth?

There has been a lot of talk and presentation on End of Life care and its high costs. “The Myth Regarding the High Cost of End of Life Care” reviews those costs and expands the topic beyond End of Life to all the population with chronic conditions and functional limitations.

FIGURE 1
Estimated overlap between the population with the highest health care costs and the population at the end of life (United States, 2011). Source. Total population and health care costs were obtained from 2011 Medical Expenditure Panel Survey data and adjusted to include the nursing home population. The distribution of total costs for the end-of-life population was estimated from Health and Retirement Study data linked to Medicare claims data, adjusted to include non-Medicare payers, and adjusted to 2011 dollars utilizing BLS Consumer Price Index.

US population distribution of health care expenditures exhibits a significant “tail” (fat tail) segment of the population with extremely high costs. The study identified 18.2 million individuals in the top 5% of total annual health care spending. These individuals incurred average annual health care expenditures of $17,500 or more per person and accounted for $976 billion in health care costs overall. Of these estimated 18.2 million individuals (5% of the population) who generated the highest annual costs, only 11% of the population (2 million individuals) are in the last year of life (Figure 1). Longitudinal analyses of spending reveal the population of 18.2 million with the highest annual health care costs can be divided into 3 broad illness trajectories:

– Individuals who have high health care costs because it is their last year of life (population at the end of life),

– Individuals who experience a significant health event during a given year but who return to stable health (population with a discrete high-cost event), and

– Individuals who persistently generate high annual health care costs owing to chronic conditions, functional limitations, or other conditions. These individuals are not in the last year of life and live for several years generating high health care expenses (population with persistent high costs).

– Angry Bear

Read the full article here.