Cost of care at the end of life: Focusing on the facts

By | January 24, 2017

There is a great deal of discussion around the cost of care at the end of life. The spectrum ranges from, “this is where we need to put all our focus,” to the press around “death panels.” In order to really understand the scope, we need to look and see what the data tells us. It is estimated that approximately 13%of the $1.6 trillion in healthcare spending in the United States is associated with the cost of care during the last year of life, and 61% of these costs are paid for by Medicare, or 25.1% of spend (Dying in America, IOM of the National Academies, pgs 502, 503, 504). This number seems lower than expected for all the attention it gets.

We need to remember that not all deaths result in high spending. An interesting fact is that costs at the end of life decrease as people age. This seems counter intuitive, but does make sense if you think about “dying of natural causes.” There are also differences amongst ethnic groups where one sees the cost is higher in those who are Hispanic, followed by those who are black, and then to those who are non-Hispanic white. People with functional limitations and chronic diseases have a much higher cost at the end of life, accounting for 77% of costs (Dying in America, IOM of the National Academies, pgs 505-508).

An article by Davis et al in Health Affairs discusses the long-term assumption that healthcare spending increases substantially at the end of life. What they found with a closer look was that in the Medicare population, the largest proportion of those that died (48.7%) had a pattern of high cost throughout their entire last year of life, not just in the last three months. This fact challenges the notion that costs rise the fastest during the last three months of life. They also found that those that did have the greatest increase of cost during the last three months of life (with basically a low and flat spend during the preceding 9 months) only accounted for 12.1% of those that died.

This information is definitely not saying that focusing on the end of life is not important. Of course it is for many reasons, especially as we think about delivering holistic care that is reverent to individual preferences. During the end of my life, I definitely want attention focused on what is best for me based on my wishes. In order to do that, I need to be informed and included in the decision. The point is we need to keep the cost of this care in perspective as we discuss the reasons for our attention during this very important time of one’s life. As we continuously focus on delivering value for those we serve within the premise of the Triple Aim, focusing on the facts will help us avoid making false assumptions and getting caught up in reasoning that is not valid.