AbstractIntroductionHealth care costs remain high at the end of life. It is not known if there is a relationship between advance directive (AD) completion and hospital out‐of‐pocket costs. This analysis investigated whether AD completion was associated with lower hospital out‐of‐pocket costs at end of life.MethodsWe used Health and Retirement Study participants who died between 2000 and 2014 (N = 9228) to examine the association between AD completion status and hospital out‐of‐pocket spending in the last 2 years of life through the use of a two‐part model controlling for socioeconomic status, death‐related characteristics and health insurance coverage.ResultsAbout 44% of decedents had completed ADs. Having an AD was significantly associated with $673 lower hospital out‐of‐pocket costs, with a higher magnitude of savings among younger decedents. Decedents who completed ADs 3 months or less before death had higher out‐of‐pocket costs ($1854 on average) than those who completed ADs more than 3 months before death ($1176 on average).ConclusionsAD completion was significantly associated with lower hospital out‐of‐pocket costs, with greater out‐of‐pocket savings among younger decedents. Early AD completers experienced lower costs than decedents who completed ADs closer to death.