Increased Use of Hospice Care Results in Reduced Health Care Spending

Posted on Thursday, March 16, 2017 12:21 PM

According to a study recently published in Health Affairs, “Increased use of hospice care would reduce health care spending in parts of the United States with high medical costs.”

The study, “Longer Periods of Hospice Service Associated with Lower End-of-Life Spending in Regions with High Expenditures,” focused on 103,745 Medicare beneficiaries who died from one of nine different forms of cancer within three years of diagnosis from 2004 to 2011.

“Longer periods of hospice service were associated with decreased end-of-life expenditures for patients residing in regions with high average expenditures, but not for those in regions with low average expenditures,” the researchers wrote.

The researchers concluded that creating incentives to use hospice in high-cost areas of the country could potentially result in impacting the total health care expenditures in the United States.

“Such targeted cost-saving measures may provide substantial economic benefits on a national scale, given that intense end-of-life care expenditures constitute a significant proportion of annual Medicare expenditures.”

A 2010 study found that five percent of Medicare beneficiaries account for more than 25 percent of Medicare spending in the final year of life.

“It is well established that physicians in different geographic regions practice differently. For example, physicians practicing in high-expenditure regions may be more likely than those in low-expenditure regions to recommend discretionary services for which strong evidence is lacking, and to test and treat patients intensively.”

“Whether or not hospice use results in cost savings is determined by the offset between the increase in hospice expenditures and the decrease in inpatient or outpatient expenditures.”

Researchers found that “hospice use accounted for 8% of the expenditure variation between the highest and the lowest spending quintiles, which demonstrates the powers and limitations of hospice use for saving on costs.”

The survey was based off the following: Surveillance, Epidemiology, and End Results (SEER) Medicare data and Medicare claims information.

For the full article, click here.

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