Of the 2.6 million people who died in the U.S. in 2014, 2.1 million, or eight out of 10, were people on Medicare, making Medicare the largest insurer of medical care provided at the end of life.
Spending on Medicare beneficiaries in their last year of life accounts for about 25% of total Medicare spending on beneficiaries age 65 or older. The fact that a disproportionate share of Medicare spending goes to beneficiaries at the end of life is not surprising given that many have serious illnesses or multiple chronic conditions and often use costly services, including inpatient hospitalizations, post-acute care, and hospice, in the year leading up to their death.
“Diseases that were highly prevalent among decedents in traditional Medicare in 2014 include hypertension (67%), ischemic heart disease (53%), chronic kidney disease (51%), congestive heart failure (48%), Alzheimer’s disease or dementia (43%), diabetes (38%), and cancer (17%).”
Characteristics Of Medicare Beneficiaries Who Died At Some Point In 2014
- More than half of Medicare decedents were age 80 or older in 2014.
- Of the more than 2.1 million Medicare beneficiaries who died at some point in 2014—representing 4.0% of the total Medicare population that year—over half (55%) were age 80 or older, which is more than double their share of the Medicare population overall (22%). Just over half (52%) of decedents were women and eight out of 10 were non-Hispanic white (81%), roughly comparable to their shares of the overall Medicare population (54% and 77%, respectively).
- More than seven in 10 (72%, or 1.5 million) Medicare decedents were in traditional Medicare in 2014, and the remainder (28%, or 0.6 million) were enrolled in Medicare Advantage plans, reflecting overall enrollment patterns in traditional Medicare and Medicare Advantage.
- Diseases that were highly prevalent among decedents in traditional Medicare in 2014 include hypertension (67%), ischemic heart disease (53%), chronic kidney disease (51%), congestive heart failure (48%), Alzheimer’s disease or dementia (43%), diabetes (38%), and cancer (17%). The prevalence of each of these conditions was higher among beneficiaries who died at some point in 2014 than among beneficiaries overall, in some cases substantially higher. For example, more than 4 in 10 decedents had Alzheimer’s or dementia, compared to only 9% of beneficiaries overall, and more half of decedents had ischemic heart disease, compared to one fourth of beneficiaries overall.
- Average Medicare per capita spending on services covered under Parts A, B, and D for traditional Medicare beneficiaries who died at some point in 2014 was $34,529—nearly four times higher than per capita spending for survivors ($9,121) and more than three times higher than the average among all beneficiaries in traditional Medicare ($10,126).
- In 2014, beneficiaries who died at some point during the year accounted for 4% of all beneficiaries in traditional Medicare, but 13.5% of traditional Medicare spending. This amount is disproportionate to the decedent share of beneficiaries overall, but it accounts for a relatively small share of total spending that year. This estimate is lower than the 25% estimate cited earlier because it is based on Medicare spending for people who died at some point in a given calendar year (in this case, 2014), rather than the last 12 months of spending for people who died.
This data note provides a snapshot of Medicare beneficiaries who died at some point in 2014 and spending at the end of life.
The analysis includes beneficiaries who are under age 65 with disabilities, those who qualified for Medicare due to having end-stage renal disease, and those who are age 65 or older. The analysis of per capita spending excludes beneficiaries enrolled in Medicare Advantage because data on Medicare spending, overall and by type of service, are not available for these enrollees. The analysis is based on data from a 5% sample of Medicare claims for services covered under Parts A, B, and D for traditional Medicare beneficiaries from the Centers for Medicare & Medicaid Services (CMS) Chronic Conditions Data Warehouse (CCW) from 2000 to 2014.
Lisa Remington is president of the Remington Health Strategy Group and publisher of the Remington Report magazine and has worked with more than 6,000 organizations in both a consultancy role and educator. Lisa monitors the complex key trends and forces of change to develop a correct strategic approach to de-risk decision-making and create sustainable futures across the healthcare continuum.