Health system costs by sex, age and proximity to death, and implications for estimation of future expenditure

Aims Health expenditure increases with age, but some of this increase is due to costs proximal to death. We used linked health datasets (HealthTracker) to determine health expenditure by proximity to death. We then determined the impact on future health expenditure projections of accounting for proximity to death in costs. Methods 2007 to 2009 national health event data were linked for hospitalisations, inpatient procedures, outpatient events, pharmaceuticals, laboratory tests, and primary care consultations. Each event was assigned a cost. Health expenditure by sex, age and whether in last 6 or 12 months of life or not were calculated. Future health expenditure trends were then estimated for the Statistics New Zealand median projection population counts, with 2010–12 mortality rates reducing by 2% per annum into the future. Results A total of $8.1, $8.8 and $9.2 billion dollars (inflation-adjusted to 2011 NZ$) was allocated to individual health events in HealthTracker in 2007, 2008 and 2009, respectively. Citizen costs for people not within 6 months of death ranged from $498 per personyear (10–14 year old females) to $6900 per person-year (90–94 year old males). Per person-year costs in the last 6 months of life were 10-fold higher on average, being maximal at $30,000 or more among infants and the older elderly (80+ years). Similar patterns were apparent for costs within 12 months of death. For people hypothetically exposed to these 2007–09 health system costs over their full life, the cumulative costs for a person dying at age 70 years was $113,000, and doubled to $223,000 for a person dying at age 90. The proportion of cumulative health expenditure in the last year of life declined with increasing age of death: e.g. 24%, 13% and 10% for someone aged 40, 70 and 90 respectively. Projections of future health system expenditure were overestimated by 2.3% to 3.5% in 2041 when not accounting for proximity to death in costs. Conclusions New Zealand is fortunate to have access to rich data on health system costs. The age-specific health system costs per citizen we have calculated can be used in health expenditure projections, for cost-effectiveness analyses, and for considering how public health expenditure is distributed across the life course.