You are not wrong. I as a past board member of a moderately large long term care facility. Information that was available in 2007 was that 70% of a persons total healthcare expenditures were in the last 5 year of life.

Tort exposure is largely what drives medical expenditures, no one wants to make an incorrect diagnosis, further, to get the necessary test another must first be performed to prove the need.  Another large exposure is in the type of facility the elderly are placed in, no one wants to go to the oldest facility. While I was on said board we did a rather expensive remodel/expansion because a for profit facility moved to town and cherry picked the type of housing they would make available to resident's. Were we to have lost that market our facility would have been bankrupt and the community would have lost its skilled care option. The remodel increased all residents monthly bill by 20%. There is no question that there was a need to improve, 60 years ago my grandmother was in a home that I would not place my worst enemy in. But we took it to extremes. Between inspections and the over abundance of caution there is no chance of Medicaid cost ever going down without tort reform.