Transcript Slide 1

DataBrief:
Differences in Medicare
Spending by Disability and
Residence
Did you know…
Medicare spends almost four times
more per capita on health care for
seniors with moderate or severe
disabilities than for those without
disabilities?
DataBrief Series September 2011 No.17
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Seniors with Disabilities and Medicare Spending
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In 2006, Medicare spent $16,517 per capita on health services for seniors with moderate or
severe disabilities. In comparison, Medicare spent $4,395 per capita on health services for
seniors without disabilities.1,2
People with moderate or severe disabilities typically require supportive services to assist with
activities of daily living. They may live in nursing homes (38%), their homes or apartments
(49%), or residential care settings such as assisted living facilities, domiciliary care facilities, or
continuing care retirement communities (9%).1
LTSS provided in these settings is paid for by Medicaid, through out-of-pocket payments, and
to a much lesser degree, through private long-term care insurance (LTCi). In addition, seniors
with moderate or severe disabilities receive a great deal of assistance from unpaid family
caregivers.3
Medicare spending varies somewhat according to the setting in which seniors with moderate
or severe disabilities live. For seniors with moderate or severe disabilities, Medicare spent
$14,594 per capita on nursing home residents, $14,001 per capita on residential care
residents, and $18,308 per capita on community residents in 2006.1,2
1 Avalere
Health, LLC analysis of the 2006 Medicare Current Beneficiary Survey, Cost and Use file. Excludes beneficiaries who died in 2006.
spending on inpatient hospital, outpatient hospital, physician, emergency department, skilled nursing facility, home health, and hospice. Excludes
prescription drugs, DME, and miscellaneous Medicare spending.
3 The SCAN Foundation (2011). DataBrief No. 13: Sources of Long-Term Care Spending. Accessed on May 11, 2011 at:
http://www.thescanfoundation.org/foundation-publications/databrief-no-13-sources-long-term-care-spending.
2 Includes
DataBrief (2011) ● No. 17
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Medicare Spends More Per Capita on Seniors with Moderate
or Severe Disabilities Than on Seniors without Disabilities1
Total Per Capita Medicare Spending By
Level of Disability, 20062
$21,000
$21,000
$18,000
Total Per Capita Medicare Spending For Beneficiaries
with Disabilities, by Residence Setting, 20062
$18,000
$16,517
$15,000
$15,000
$12,000
$12,000
$9,000
$9,000
$6,000
$4,395
$3,000
$0
$0
Seniors without
Disabilities
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$14,001
3
$14,5943
$6,000
$3,000
Seniors with
Moderate or Severe
Disabilities
$18,308
Community
Residential Care
Residents with
Residents with
Moderate or Severe Moderate or Severe
Disability
Disability
Nursing Home
Residents
1 Seniors
with moderate or severe disability includes community residents and residential care residents with 2 or more Activities of Daily Living (ADL)
needs
and all nursing home residents. N= 1,161,759 community residents with 2+ ADLs, 202,161 residential care residents with 2+ ADLs, 817,954 nursing home
residents, and 24,553,318 community and residential care residents with no disabilities. Excludes beneficiaries who died in 2006.
2 Includes spending on inpatient hospital, outpatient hospital, physician, emergency department, skilled nursing facility, home health, and hospice.
Excludes
prescription drugs, DME, and miscellaneous Medicare spending.
3 The differences in spending between all 3 residence settings are statistically significant at the p = 0.05 level.
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About the data:
This analysis is based on the 2006 Medicare
Current Beneficiary Survey (MCBS) Cost and
Use file, an annual, longitudinal survey of a
representative sample of all Medicare
enrollees. The MCBS collects information on
residence setting, level of disability, health
services utilization, and health spending.
This analysis is limited to respondents in the
community and residential care settings who
indicated that they received help or standby
assistance in two or more ADLs (eating,
bathing, dressing, toileting, or transferring). It
includes all nursing home residents and
assumes that all nursing home residents have
at least that level of disability or LTSS need.
Residential care is defined as assisted living
facilities, retirement communities, continuing
care communities, and other types of
residential care facilities.
This analysis is also limited to individuals age
65 or older who are enrolled in the fee-forservice, or traditional, Medicare program. It
excludes beneficiaries who had any Medicare
Advantage spending in 2006 and excludes
beneficiaries who died in 2006.
A Clear Policy Connection
In 2006, Medicare spent significantly more per capita for seniors with
moderate or severe disabilities than for seniors without disabilities. This
difference in spending persisted across residence settings. Much of this
difference in spending could be explained by the presence of a disability.
The Affordable Care Act (ACA) provides opportunities to reduce Medicare
spending while maintaining or improving the quality of care provided to
beneficiaries. For example, the Medicare Shared Savings Program is one
program that is targeted to accountable care organizations (ACOs)—
teams of doctors, hospitals, and other health care providers who will
work together to better integrate care for patients. The program is
voluntary and will reward ACOs that meeting cost savings requirements
and other performance standards. Additionally, ACOs will be at-risk if
they fail to provide efficient, cost-effective and high quality care.1
Though led by primary care providers, the success of ACOs participating
in the Shared Savings Program will depend not only on their ability to
coordinate medical services across provider settings, but also to integrate
community-based supportive services to better address disability that
may be driving health care costs.
Other similar opportunities provided by the ACA include medical/health
homes and the Independence at Home demonstration.
1 Centers
Analytics powered by Avalere Health LLC
for Medicare and Medicaid Services. What Providers Need to Know: Accountable
Care Organizations. April 2011. Accessed July 19, 2011
http://www.cms.gov/MLNProducts/downloads/ACO_Providers_Factsheet_ICN903693.pdf.
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