Earlier this year, Medicare began covering advance care planning as a separate and billable service. In other words, physicians and other health care professionals can be reimbursed for consulting with Medicare patients about their end-of-life preferences.
Today’s employer benefit plans often cover advance care planning as well, although end-of-life care is rarely discussed with active employees.
This is an emotionally charged subject that not only impacts an individuals’ final months but also has significant financial implications for the health care system.
Here’s a look at the facts about end-of-life health care spending.
FACT: Americans aren’t getting the care they prefer.
Nine out of 10 adults say they would prefer to die at home if they had a terminal illness. Despite this preference, only about one-third of Medicare beneficiaries died at home.
Often, people nearing the end of their lives aren’t able to make decisions or communicate them, so it’s essential to have advance care planning discussions before they are needed, according to Dying in America, a report by the Institute of Medicine.
FACT: Roughly 25% of all Medicare expenditures are attributed to the 5% of beneficiaries that die each year.
Forget the old 80/20 rule. In health care, a disproportionate amount of money is spent in the last year of life. In fact, the largest portion of money is spent in the final month of life, according to a report from the Kaiser Family Foundation.
Arcadia Healthcare Solutions recently published an analysis of the cost of care during the final month of life, confirming the obvious: It’s up to seven times much more expensive to die in a hospital than at home. Additionally, patients in hospitals have many more (often unpleasant) medical interventions in the last days of their lives than those who die in other settings.
FACT: Other countries are also struggling.
The United States has a lower proportion of deaths in the hospital in the last six months of life than Canada, Belgium, England, Norway and Germany, according to research published by the Perelman School of Medicine at the University of Pennsylvania.
The cost? Spending on hospital care in the last six months of life in Canada averages $21,840 compared with an average of $18,500 in the United States. Belgium, England and the Netherlands spend $15,699, $9342 and $10, 936 respectively.
FACT: American medical schools place little emphasis on end-of-life care.
Today, our medical schools teach students to treat disease, and our health care system is primarily based on a fee-for-services model that rewards professionals based more on quantity of care than quality of care.
Although there have been recent improvements, initiating conversations about advance care planning is still a conundrum: Patients, family members and clinicians each wait for others to bring up the topic.
FACT: Advanced Directives are getting a shot-in-the-arm
A whopping 40% of Americans ages 65 and older do not have advanced directives or haven’t written down their preferences, according to the Kaiser Family Foundation. Demographics play a role: Advance directives used are less by African Americans and Hispanics, and people with lower levels of income or education have lower rates of advance directives than others.
What about DNR (Do Not Resuscitate) orders? They’re not enough because they don’t address quality of life and treatment preferences.
Hopefully, Medicare’s decision to cover end-of-life talks will help overcome these obstacles.