This study illustrates that Medicare claims can be used to measure population-based, provider-specific rates of resource inputs, utilization, and Medicare spending. The target populations are seventy-seven cohorts of chronically ill Medicare enrollees who received most of their care from seventy-seven well-known U.S. hospitals. Striking variations are documented in resource inputs and use of services during the last six months of life. The patterns of care seen in the progression of chronic illness correlate highly with care received during previous periods. We believe that hospital-specific measures can be helpful in identifying providers with acceptable quality indices who are also relatively efficient in managing chronic illness.