Medical Care at the End of Life: Diseases, Treatment Patterns, and Costs

Alan M. Garber, Thomas E. MaCurdy, Mark C. McClellan

NBER Working Paper No. 6748
Issued in October 1998
NBER Program(s):Economics of Aging, Health Care

In recent years, the use of Medicare-covered home health care and hospice services has grown dramatically. Hospice care, like much home health and nonacute hospital care, is designed to meet the needs of dying patients, who are known to generate disproportionately large costs of care. How has use of these services by dying Medicare beneficiaries changed over time? How has it varied by disease? Does recent experience suggest that these services have helped save the Medicare program money by displacing hospital care and other costly services? To address these questions, we examined linked Medicare claims files from 1988 to 1995, determining the location of death, days of use of services, and expenditures for the care of beneficiaries in the final months of life. We found that use of hospice and home health services by decedents grew rapidly over the eight-year study period, and especially rapidly among patients who died with a predictably terminal illness such as lung cancer. Among the elderly who have such illnesses, these alternatives to acute hospital care have reduced the use of hospital care near the very end of life. Most of the growth in these services in the year or two before death, however, appears to involve additional Medicare-covered services. As a result, utilization of Medicare-covered home health and hospice care by dying beneficiaries has increased over time, with an associated reduction in the proportion of deaths occurring in acute-care hospitals. But as the use of non-hospital services has grown, the growth in Medicare expenditures for hospital services at the end of life has not slowed appreciably, nor has there been a marked change in the intensity of end-of-life treatment for Medicare beneficiaries dying of more acute illnesses or requiring substantial supportive care.

download in pdf format
   (1252 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w6748

Published: Frontiers in Health Policy Research. Garber, Alan M., ed., Cambridge: MIT Press, 1999, pp. 77-98.

Users who downloaded this paper also downloaded* these:
Becker, Murphy, and Philipson w13333 The Value of Life Near its End and Terminal Care
Garber, MaCurdy, and McClellan Medical Care at the End of Life: Diseases, Treatment Patterns, and Costs
Skinner and Wennberg w6513 How Much is Enough? Efficiency and Medicare Spending in the Last Six Months of Life
Philipson, Becker, Goldman, and Murphy w15649 Terminal Care and The Value of Life Near Its End
Marshall, McGarry, and Skinner w16170 The Risk of Out-of-Pocket Health Care Expenditure at End of Life
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us