To examine end-of-life government expenditures for short- and long-stay Medicare- and Medicaid-eligible (dual-eligible) nursing home (NH) hospice and nonhospice residents. A retrospective cohort study. Six hundred fifty-seven Florida NHs. Dual-eligible NH residents who died in Florida NHs between July and December 1999 (N=5,774). Nursing home stays of 90 days or less were considered short stays (n=1,739), and those over 90 days were long stays (n=4,035). Three diagnosis groups were studied: cancer without Alzheimer's disease or dementia, Alzheimer's disease or dementia, and other diagnoses. Eligibility and expenditure claims data for 1998 and 1999 were merged with vital statistics and NH resident assessment data to determine diagnoses, location of death, hospice enrollment, eligibility, and expenditures. Twenty percent of short-stay (n=350) and 26% of long-stay (n=958) NH decedents elected hospice; of these, 73% of short-stay and 58% of long-stay NH residents had hospice stays of 30 days or less. Overall, mean government expenditures in the last month of life were significantly less for hospice than nonhospice residents (7,365 dollars; 95% confidence interval (CI)=7,144-7586 dollars vs 8,134 dollars; 95% CI=7,896-8,372 dollars), but 1-month expenditures were only significantly lower for hospice residents with short NH stays, not for those with long NH stays. Overall, hospice care in NHs does not appear to increase government expenditures. Because significantly lower expenditures are observed for short-stay NH hospice residents, policy restricting access to Medicare hospice for Medicare skilled nursing facility residents may represent a missed opportunity for savings.