Incidence and Cost of Pneumonia in Medicare Beneficiaries

Background: Pneumonia is a frequent and serious illness in elderly people, with a significant impact on mortality and health-care costs. Lingering effects may influence clinical outcomes and medical service use beyond the acute hospitalization. This study describes the incidence and mortality of pneumonia in elderly Medicare beneficiaries based on treatment setting (outpatient, inpatient) and location of origin (health-care associated, community acquired) and estimates short- and long-term direct medical costs and mortality associated with an inpatient episode of pneumonia. Methods: Administrative claims from a 5% sample of fee-for-service Medicare beneficiaries aged 65 years from 2005 through 2007 were used. Total direct medical costs for patients during and after hospitalization for pneumonia compared with similar patients without pneumonia (the excess cost of pneumonia) were estimated using propensity score matching. Results: The age-adjusted annual cumulative incidence of any pneumonia was 47.4 per 1,000 beneficiaries (13.3 per 1,000 inpatient primary pneumonia), increasing with age; one-half of pneumonia cases were treated in the hospital. Thirty-day mortality was twice as high among beneficiaries with health-care-associated pneumonia than among those hospitalized with community-acquired pneumonia (13.4% vs 6.4%). Total medical costs for beneficiaries during and 1 year following a pneumonia hospitalization were $15,682 higher than matched control patients without pneumonia. The total annual excess cost of hospital-treated pneumonia as a primary diagnosis in the elderly fee-for-service Medicare population in 2010 is estimated conservatively at > $7 billion. Conclusions: Pneumonia in elderly people is associated with high acute-care costs and an overall impact on total direct medical costs and mortality during and after an acute episode. CHEST 2012;142(4):973-981