The impact of natural disasters on medicare costs in U.S. gulf coast states

Medicare utilization and costs for residents of the U.S. Gulf Coast, who are highly vulnerable to natural disasters, may be impacted by their disaster exposure. To estimate differences in healthcare utilization by disaster exposure, we calculated Medicare expenditures among residents of U.S. Gulf States and compared them with expenditures among residents of other regions of the U.S. Panel models were used to calculate changes in overall Medicare expenditures, inpatient expenditures, and home health expenditures for 32,819 Medicare beneficiaries. Individual demographic characteristics were included as predictors of change in expenditures. Medicare beneficiaries with National Health Interview Survey participation were identified and Part A claims were linked. Federal Emergency Management Agency (FEMA) data was used to determine counties that experienced no, some, high, and extreme hazard exposure. FEMA data was merged with Medicare claims data to create a panel dataset from 2001 to 2007. Medicare Part A claims for the years 2001 to 2007 were merged with FEMA data related to disasters in each U.S. County. Overall Medicare costs, as well as costs for inpatient and home health care for residents of states located along the U.S. Gulf Coast (Texas, Louisiana, Mississippi, Alabama, and Florida) were compared to costs for residents of the rest of the U.S. Expenditures among residents of U.S. Gulf States decreased with increased hazard exposure. Decreases in inpatient expenditures persisted in the years following a disaster. The use of beneficiary-level data highlights the potential for natural hazards to impact health care costs. This study demonstrates the possibility that exposure to more severe disasters may limit access to health care and therefore reduce expenditures. Additional research is needed to determine if there is a substitution of services (e.g., inpatient rehabilitation for home health) in disaster-affected areas during the post-disaster period.