ALZHEIMERS-DISEASE UNDER MANAGED CARE - IMPLICATIONS FROM MEDICARE UTILIZATION AND EXPENDITURE PATTERNS

BACKGROUND: Little information is available about the costs, utilizati on patterns, and the delivery system used by Medicare beneficiaries wi th chronic illnesses. This information will become increasingly import ant as more Medicare beneficiaries with chronic illness enroll in mana ged care plans and delivery systems must be developed to meet their ne eds. OBJECTIVES: To analyze health care expenditures and utilization p atterns for Medicare beneficiaries with dementia of the Alzheimer type (DAT) and compare them with those of all Medicare beneficiaries. DESI GN: A cross-sectional study. SETTING: Practices providing services to Medicare beneficiaries in the U.S. SUBJECTS: Aged Medicare beneficiari es with DAT in fiscal year(FY) 1992. MEASUREMENTS: Medical expenditure s and utilization patterns. RESULTS: In FY 1992, per capita Medicare e xpenditures for 9323 patients with DAT were $6208, or 1.9 times the pe r capita expenditure for all 1,221,615 beneficiaries in our sample. In patient care accounted for 62.7% of expenditures. Internal medicine wa s the specialty identified with the largest proportion of expenditures , but no single specialty accounted for the majority of care. Payments increased with comorbid conditions such as heart failure, chronic pul monary diseases, and cerebrovascular disease. CONCLUSION: Current Medi care capitation payments to managed care plans may not meet the higher expected annual costs of care for beneficiaries with DAT. In turn, ph ysicians (or physician groups) who accept capitation for Medicare bene ficiaries with DAT should also consider how capitation rates are estab lished by managed care plaits and should learn ways to reduce financia l risk.