At a policy related forum for medical residents at the Massachusetts General Hospital last week, one of the questions was about end of life care. The other panelists and I answered from a clinical perspective – and I also put a plug in for the Kenneth B. Schwartz Center which does educational programs for clinicians about strengthening patient-caregiver relationships and communications.

However, during the informal discussion after the panel, a number of the residents raised questions about how much of our healthcare spending goes for treating people at the end of life. In talking with them about this, I recalled three things having looked at this issue several years ago: First, there is a lot of public misunderstanding and misrepresentation of information about this topic. For example, percentages of Medicare spending turning into percentage of total healthcare dollars, or spending in the last year of life being reported as spending in the last month of life. Second, the percentage of healthcare spending in the last 6 months of life has not changed in decades. And third, people agree that if a patient’s life expectancy was clear, then it would be easy to reduce spending at the end of life. This last point was one of the reasons for hospice care, which attempts to both improve clinical care and reduce costs. Hospice has been a big clinical success since – unlike hospitals and general home care services – it is designed to fit the needs of the patient and their family.

So what about costs at the end of life? I did a quick (and admittedly non-comprehensive) search for more information, and found that:

• As of the late 1990s, care in the last year of life consumed about 27% of Medicare’s spending and this percentage hadn’t changed in 20 years. These costs represent 10-12% of total healthcare costs, and 30-40% of this spending occur in the last month of life.
• There is great variability of costs incurred during the last 6 months of life across the country – with up to a 250% difference. But this might also reflect the overall variability in healthcare costs by location.
• A 2007 study found that hospice use reduced Medicare’s costs in the last year of life by 23%, but a 2004 study found that savings from hospice were only with younger patients with cancer, and that overall, hospice enrollment cost Medicare more money.
• A great 2002 article reviews the literature and the issues about end of life care – including how Medicare financial incentives may contribute to more intensive care and higher costs.

So what are my conclusions? Any focus on reducing spending on end of life care as the solution for our rising health care costs is misplaced. These costs are significant, but they are only part of the problem since their growth reflects the overall rise in healthcare spending. And Buntin and Huskamp’s conclusion in their 2002 article, that we have “critical gaps in our knowledge about how to design a better end-of-life care system for Medicare beneficiaries,” is right on target.

What are your thoughts about end of life care, hospices, and educational organizations for clinicians like the Schwartz Center?