Disability Has Far-reaching Consequences

Almost 75 percent of the elderly (age 65 and over) have at least one chronic illness. About 50 percent have at least two chronic illnesses. Chronic conditions can lead to severe and immediate disabilities, such as hip fractures and stroke, as well as progressive disability that slowly erodes the ability of elderly people to care for themselves.According to AHRQ's 1996 Medical Expenditure Panel Survey (MEPS),about 14.3 percent of people age 65 and over—4.5 million elderly Americans—require assistance with bathing, dressing, preparing meals, or shopping.

The costs associated with treating the elderly with chronic conditions are high and continuing to grow. These costs are borne by everyone—Federal and State governments, families, and the elderly themselves. AHRQ research shows that out-of-pocket health costs are highest for people with chronic health conditions or functional impairment.

Home care expenses contribute to these high costs. For example, home health care expenses for the elderly totaled $27.2 billion in 1996, and Medicare paid for nearly 60 percent of these expenses. The elderly also paid more of these expenses themselves than did younger people. MEPS data from 1996 show that the elderly were more likely than younger people to incur expenses for home health care and their costs per person were higher (Table 1). AHRQ research indicates that the primary risk factor for requiring formal home health care is difficulty in bathing, dressing, eating, or using the toilet.Many elderly people can maintain or improve their functional ability by attending the CDSMP and practicing its principles.

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^a The Medical Expenditure Panel Survey is conducted to provide nationally representative estimates of health care use, expenditures, sources of payment, and insurance coverage for the U.S. civilian noninstitutionalized population. MEPS is cosponsored by the Agency for Healthcare Research and Quality and the National Center for Health Statistics (NCHS).

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Table 1. Home health services use and expenses, 1996

Statistic: Percent with expense
Under age 65: 1%
Age 65 and over: 13%

Statistic: Average annual expense per person
Under age 65: $3,342
Age 65 and over: $6,041

Statistic: Percent paid out of pocket
Under age 65: 2.7%
Age 65 and over: 14.5%

Statistic: Amount paid out of pocket
Under age 65: $186 million
Age 65 and over: $3.9 billion

Statistic: Percent paid by Medicare
Under age 65: 27.6%
Age 65 and over: 58.9%

Statistic: Amount paid by Medicare
Under age 65: $1.9 billion
Age 65 and over: $16 billion