Healthcare Costs and Utilization of Older Adults: Where Can We Intervene?

Background: The rapidly growing population of adults over age 65 already contributes to a large proportion of healthcare costs. We identified subgroups among older adults where targeted measures could lead to decreases in healthcare costs and utilization.

Methods: Medical Expenditure Panel Survey 2000-2009 data were pooled for adults aged 65+ (n=34,643; mean age 74.4). Structural equation modeling was used to identify the strongest predictors of healthcare expenditures, emergency room (ER) visits, and length of hospital stay. Mean expenditures were calculated in 2010 dollars for each older adult subgroup with adjustment for other covariates. Results were adjusted for complex survey design effects.

Results: An average older adult had 1.9 chronic health conditions and saw a healthcare provider approximately 12 times/year. After controlling for direct and indirect effects of gender, income, race/ethnicity, education, health insurance status, age, and smoking status, the factors most strongly associated with all outcomes were the number of chronic conditions ($2,759 per person annual cost increase per condition) and current employment ($1,059 per person annual cost decrease). Factors which ordinarily improve health in earlier life, such as higher education, resulted in increased costs and healthcare utilization among older adults.

Conclusions: Healthcare cost and utilization reduction efforts targeted at the older population should include measures to reduce chronic illness and disability, as well as measures enabling continued employment of older adults. Decreasing health disparities and improving health behaviors at younger age results in increased costs after age 65, and is unlikely to curb the growing expenditures among the elderly.