The National Institute for Healthcare Management Foundation is a nonprofit, nonpartisan organization focused on healthcare. The foundation just published an excellent report on the distribution of healthcare costs in the population.
The results indicate that reducing healthcare cost is all about reducing and managing chronic diseases.
U.S. healthcare spending has sharply increased between 2005 and 2009 by 23 percent from $2 trillion to $2.5 trillion per year.
This is a result of a combination of factors. Chief among them is the increasing incidence of obesity.
Who spends the money?
Five percent of the population is responsible for 47% of all health care spending in the United States. Ten percent of the population accounted for 63.3% of the expenditures.
Fifty percent (50% percent) of the population accounted for only 3% of the healthcare expenditures.
The low cost person spent $233 in 2008 for healthcare services. Those in the top half of spending cost insurers, the government, or themselves $7,317 a year. The top 1 percent cost $76,476 per year. These are discounted fees not retail fees.
Healthcare expenditures were concentrated among a small group of high-cost patients. These high cost patients were older patients (over 55 years old) with one or more chronic diseases. If they were young and they had one or more chronic diseases healthcare expenditures increased. The more chronic diseases a patient had, the higher the likelihood the patient would be in the top 5% of healthcare dollar utilizers.
Fifty percent of the top 5 percent of healthcare spenders had high blood pressure, a third had high cholesterol, and a quarter had diabetes. The incidence of hypertension, hypercholesterolemia and adult onset type 2 Diabetes Mellitus is directly proportional to the presence of obesity.
It follows that healthcare costs will increase as a result of the increasing incidence of obesity. America must control the obesity epidemic.
Little progress is being made to decrease the increasing incidence of obesity or Type 2 Diabetes.
In a perfect world, if obesity could be decreased, the incidence of chronic disease would be decreased.
In a perfect world, if the patients with chronic diseases could be taught to self-manage their disease, healthcare costs would decrease because the incidence of complications of chronic disease would be decreased by at least 50%.
The treatment of the complications of chronic diseases is the most costly healthcare expenditure.
President Obama’s Healthcare Reform Act mentions prevention and chronic disease management. There are no concrete incentives for patients to learn how to manage their chronic diseases. There are no specific financial incentives for physicians to develop facilities to teach patients to mange chronic diseases.
Americans are in for a long and costly dysfunctional healthcare system to the disadvantage of consumers and physicians.
President Obama’s Healthcare Reform Act puts consumers in a passive dependent position. Consumers need to be put in a proactive position to care for and be responsible for their health and healthcare needs.
Physicians have to have incentives to teach consumers to be self-reliant.
*This blog post was originally published at Repairing the Healthcare System*