A National Perspective of Medicare Expenditures for Elderly Veterans with Hip Fractures

Introduction: The Centers for Medicare and Medicaid Services (CMS) recently announced that beginning in October 2008, Medicare will no longer reimburse hospitals for the costs of treating injuries from several preventable conditions, including inpatient falls resulting in hip fracture. If hospitals try to shift this care to other payers, elderly veterans who are dually eligible for care in Medicare and Veterans Health Administration (VHA) facilities may be adversely affected. As health care provided for a hip fracture can be substantial, the goal of this research was to calculate Medicare payments for a national cohort of elderly veterans with hip fractures, beginning with the first inpatient admission and continuing through one year. Methods: This was a retrospective, secondary data analysis of national VHA-eligible Medicare beneficiaries. The study population was 43,104 veterans with a hip fracture first admitted to a Medicare-eligible facility during 1999-2002. The estimation method was an ordinary least squares regression model of Medicare payments to providers for hip fracture patients over 4 time periods, up to 1 year after discharge, controlling for age, gender, inpatient length of stay, 1-year mortality, and selected Elixhauser comorbidities. Results: Medicare reimbursed providers for nearly $3 billion of health care for hip fracture patients the first year of injury. Approximately 71.4% ($49,544) of the total annual Medicare payments (for all services) occurred within the first 30 days of hospital admission. Inpatient and carrier (physician) providers received the majority of the payments. The average annual payment per individual was $69,389 (99% confidence interval: $68,539-$70,239). Almost 7 in 10 hip fracture patients obtained care in a skilled nursing facility (SNF) during the year, with these providers comprising only 12% of total annual Medicare payments. In this elderly veteran cohort, hip fracture patients with renal failure, diabetes, lymphoma, and metastatic cancer generated the highest payments. Conclusion: This analysis provides proxy cost estimates for hip fracture patients useful for the forthcoming CMS reimbursement policy changes for inpatient fall-related injuries. The VHA and dually eligible elderly veterans could be disproportionately exposed to the economic consequences of the new CMS policy change.