A Longitudinal Perspective on Patterns of Medicare Payments

Abstract

To provide insight into the stream of Medicare payments over time, a sixteen-year longitudinal study examines three age cohorts of beneficiaries, looking separately at beneficiaries who died during the study period and those who survived. The common wisdom that a small minority of the population accounts for a large majority of health care expenditures is tempered when health care use is examined over an extended period of time. By putting high average costs in the final years of life in the context of a cohort's total lifetime experience, the study shows a leveling of spending over time, resulting in a lower concentration of health care resources on a small fraction of the population.