Costs of End-of-Life Hospitalizations

By November 23, 2009January 18th, 2010Commentary

End-of-life expenses are one of the known major contributors to overall health spending.  Much of this cost arises from hospitalizations.  The Agency for HealthCare Research and Quality released a Statistical Brief examining the costs, causes and characteristics of hospital stays ending in death.  (AHRQ Brief) Using 2007 data, the researchers estimated that 2,423,995 people died in the United States, and about one-third, or 765,651, died in the hospital.  The total cost of the hospital stays during which these people died was $20 billion.

Medicare patients were 67% of the hospital deaths, privately insured persons were 20% and Medicaid patients represented 2%.  The average cost for the stay of a Medicaid person was $39,000; for Medicare it was $24,000 and for private insurance, $29,000.  The overall average cost of $26,000 compares to an average cost of $9,500 for patients discharged alive.

Somewhat surprisingly, 12% of these deaths occurred after an elective admission, although maybe that is a little less surprising when you learn that the leading cause of death was septicemia, a blood infection that led to 15% of all hospital deaths.  Although the report doesn’t go into this detail, it might be that much of that septicemia was acquired in the hospital.  Other major causes of death were respiratory failure, stroke, pneumonia and heart attack.

The possibility of significant savings in end-of-life care has been a major thrust for reducing overall health spending trends.  This report does not address variation in care and costs across regions or hospitals or make judgments on appropriateness of care.  It also only looks at hospitalizations which directly involved death.  Twenty billion dollars is significant but not huge in the context of total health spending.  Depending on what care is actually rendered, it is not clear how much savings could be avoided.  Most of the admissions were emergency in nature and it is hard to imagine how you could suggest that the person not be taken to the hospital or the hospital not treat them because they thought the person would die anyway.  As with most of health care, figuring out exactly where the inappropriate or inefficient spending may be will be more difficult that first glance would suggest.

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