Hospital Expenditures in Western Australia in the Last Years of Life: A Population-Based Record Linkage Study

Abstract

Background: Over the last 30 years, the age composition of the population in most developed countries has changed significantly. The relative number of old persons has steadily increased, and this is expected to continue in the future. While many of the problems associated with the economic effects of ageing are concerned with the size of the workforce, wealth creation and the impact of increasing superannuation costs, the rising cost of health-care is also a major concern. This study aimed to explore patterns of health expenditure for in-patient hospitalisation in the last three years of life so as to understand the degree to which different groups contribute to health care expenditure. Method: Records of all deaths occurring in Western Australia from 1997 to 2000 inclusive were extracted from the WA mortality register and linked to records from the hospital morbidity data system (HMDS) via the WA Data Linkage System. Inflation adjusted hospital costs were assigned to all in-patient events occurring within three years of death from colorectal cancer, lung cancer, female breast cancer, ischaemic heart disease and cerebro-vascular disease using DRG costing information. The distribution of the total and mean cost of in-patient hospitalisations was evaluated by age at hospitalisation, cause of death and time to death. Results: Deaths from colorectal cancer, breast cancer, lung cancer, cerebro-vascular disease and ischaemic heart disease represented 31% of all cause mortality in WA from 1997-2000. The total cost of in-patient hospitalisation in the last three years of life in these individuals was A$159.2m in males (53% of the total) and A$139.4m in females (47%). Males aged 75-79 years and females aged 80-84 years were found to have the highest total cost of hospitalisation in the last three years of life at A$28.6m and A$22.3m respectively. When total cost of hospitalisation was evaluated by cause of death ischaemic heart disease was the most costly at for both males (A$75.2m) and females (A$57.7m). In females the least costly cause of death was lung cancer (A$15.8m) while in males cerebro vascular disease accounted for the least cost (A$21.1m). When time to death was evaluated both total cost and cost per hospitalisation remained more or less constant for the two and a half years prior to death and then rose sharply five months prior to death in both males and females to be approximately double in the last month of life. When costs by time to death were disaggregated by age the mean cost per hospitalisation prior to the last five months of life was positively associated with age; however, the magnitude of the increase in the last five months of life was inversely related to age. Some minor differences in the age specific trends were observed when further disaggregated by cause of death. Most importantly unlike the pattern observed in other causes of death the mean cost of hospitalisation for those aged over 80 years who died from ischaemic heart disease and cerebro-vascular disease showed no sharp increase in the last quarter of life. Conclusion: This study has demonstrated that in-patient hospital costs vary by gender, age at hospitalisation, cause of death and time to death. The finding that increased costs are associated with proximity to death but that the magnitude of the increase is inversely associated with age has implications for the ongoing debate about whether proximity to death or age is the biggest driver of health care costs