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The Journals of Gerontology Series B: Psychological Sciences and Social Sciences 59:S197 (2004)
© 2004 The Gerontological Society of America


AUTHORS RESPONSE

Letter to the Editor and Authors' Response

Edward C. Norton, PhD, Zhou Yang, MPH and Sally C. Stearns, PhD

University of North Carolina at Chapel Hill

Authors' Response:

Kathryn Barzilai and Alfred Rimm raise two important issues in response to our Journal of Gerontology article (Yang, Norton, & Stearns, 2003Go).

Their first point is that because monthly individual health care expenditures are skewed, reporting median expenditures is more appropriate than means. Expenditures are certainly skewed. Mean monthly health care expenditures ($720.14) are nearly six times as large as the median ($122.75), for the entire sample. However, we report means because the research question that motivated our paper concerns future Medicare expenditures. The Medicare budget depends on both the total number of people covered by Medicare and the mean spending per beneficiary—not the median. In addition, median expenditures are zero for many types of expenditures (e.g., inpatient, nursing home, and home health care), making comparisons pointless. In other research papers, we look at the entire distribution of health care expenditures, including the median, to answer research questions for which the distribution is of central importance.

Their second point is that, because mean expenditures in the last 4 months before death are much higher than those in the 12 to 5 months before death, it would be interesting to redraw the graphs to compare three groups: survivors, decedents 12 to 5 months from death, and decedents in the last 4 months of life. Barzilai and Rimm speculate that median expenditures for those 12 to 5 months from death are similar to those of survivors. They may find the new graphs (available upon request) surprising, because we found that comparisons across the three groups depend on age and type of expenditures. Median total health care expenditures rise much faster with age for those 12 to 5 months from death than for either other group. For people of younger ages (66 to 82 years), median total health care expenditures of those 12 to 5 months from death are much closer to those for survivors than to those in the last 4 months of life. By the time the people reach the age of 87, however, the expenditures are about halfway between the medians of the survivors and the decedents in the last 4 months of life. Beyond age 92, both decedent groups have similar median total health care expenditures, which are many times greater than those of survivors. For specific types of expenditures, the patterns are also different. Median out-of-pocket expenditures are similar for both decedent groups, and they are far greater than those of survivors. Median inpatient, nursing home, and home health expenditures are zero for nearly all ages and subgroups with one exception. For persons over the age of 90, both decedent groups had substantially higher median nursing home expenditures than survivors.

We thank Barzilai and Rimm for raising these issues. We hope this exchange will stimulate further research.

Acknowledgments

Address correspondence to Edward C. Norton, PhD, Department of Health Policy and Administration, CB #7411, University of North Carolina at Chapel Hill, Chapel Hill, NC 27599-7411. E-mail: edward_norton{at}unc.edu

Reference





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