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We utilized Medicaid data from five states which account for 39 per cent of Medicaid expenditures to study the impact of the near-trebling of persons age 85 and older (the very old) projected to occur by the year 2012 upon Medicaid nursing home expenditures. We found a one-year prevalence of Medicaid-covered nursing home residence of 20 per 100 among the very old. If this rate continues, with no changes in current levels of Medicaid nursing home payments, and if population forecasts are accurate, increasing numbers of the very old will generate an additional +6.3 billion (1982 dollars) annually of Medicaid nursing home payments by 2012: an increase of 280 per cent from 1982 levels. The stress this trend will place upon societal ability to check growth in public expenditures for medical care while maintaining basic services for other low income populations will be an important force shaping public health policy in the next 25 years.

Impact of growing numbers of the very old on Medicaid expenditures for nursing homes: a multi-state, population-based analysis.