Nursing home characteristics related to medicare costs for residents with and without dementia

Objectives. To evaluate the relationship of nursing home characteristics to Medicare costs overall and by dementia status. Design. New admissions followed for 2 years. Setting. Random stratified sample of 55 Maryland nursing homes. Participants. Sample of 1257 residents. Measures. Records, interview, and observation. Results. Medicare costs were lower in facilities that have a better environmental quality, hospice beds, and more food service workers; costs were higher in hospital-based facilities and those that have a higher Medicaid case mix, X-ray, and some specified types of staff. Across all characteristics, costs for residents with dementia were consistently two-thirds the cost of other residents. Discussion. In terms of dementia status, resident characteristics drive Medicare costs, as opposed to facility characteristics. Using alternative residential settings for individuals with dementia may increase Medicare costs of nursing home residents and Medicare costs of residents with dementia who are cared for in settings less able to attend to medical needs.