Functional Impairment: An Unmeasured Marker of Medicare Costs for Postacute Care of Older Adults

ObjectivesTo assess the effects of preadmission functional impairment on Medicare costs of postacute care up to 365 days after hospital discharge. DesignLongitudinal cohort study. SettingHealth and Retirement Study (HRS). ParticipantsNationally representative sample of 16,673 Medicare hospitalizations of 8,559 community-dwelling older adults from 2000 to 2012. MeasurementsThe main outcome was total Medicare costs in the year after hospital discharge, assessed according to Medicare claims data. The main predictor was functional impairment (level of difficulty or dependence in activities of daily living (ADLs)), determined from HRS interview preceding hospitalization. Multivariable linear regression was performed, adjusted for age, race, sex, income, net worth, and comorbidities, with clustering at the individual level to characterize the association between functional impairment and costs of postacute care. ResultsUnadjusted mean Medicare costs for 1 year after discharge increased with severity of impairment in a dose-response fashion (P < .001 for trend); 68% had no functional impairment ($25,931), 17% had difficulty with one ADL ($32,501), 7% had dependency in one ADL ($39,928), and 8% had dependency in two or more ADLs ($45,895). The most severely impaired participants cost 77% more than those with no impairment; adjusted analyses showed attenuated effect size (33% more) but no change in trend. Considering costs attributable to comorbidities, only three conditions were more expensive than severe functional impairment (lymphoma, metastatic cancer, paralysis). ConclusionFunctional impairment is associated with greater Medicare costs for postacute care and may be an unmeasured but important marker of long-term costs that cuts across conditions.