Does Hospice Care Reduce Medicare’s Cost for End-of-Life Care? No.

This is Jason Shafrin, writing at the Healthcare Economist blog:

Medicare recipients in their final year of life generate about six times the expenditures of the average surviving Medicare enrollee and account for almost 30 percent of total program spending. Can hospices decrease Medicare’s end-of-life expenditures? A paper by Garber, MaCurdy and McClellan find that the answer is no.

In summary, although hospice utilization increased and inpatient hospital care decreased, “the simultaneous rise in the use of hospice and other services, however, meant that the number of days that patients received Medicare-covered services rose between 1988 and 1995.” the net effect of these changes in utilization was an increase in monthly Medicare expenditures before death, rising from about $5,500 in 1988 to more than $7,000 in 1995 (in 1995 dollars).

Comments (3)

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  1. Ken says:


  2. Bruce says:

    I think the reason for this result is that everybody is just gaming the system. So the more options you create, the more opportunities there will be for gaming. Hence: liberalizing hospice options gives people one more way to bilk the government out of more money.

  3. Ken says:

    Interesting result.