Alliance for Health Reform Examines Problems in American Health System’s Delivery of Chronic Care
A new issue brief from the Alliance for Health Reform summarizes a February conference that examined the extent and cost of chronic care in the American health system. A Harris Interactive survey released at the conference found that $774 billion, 75% of total U.S. health expenditures, went toward individuals with chronic conditions in 2000, a figure that is expected to rise to $1.07 trillion in 2020, or 80% of overall health spending. In addition, the survey data revealed that 99% of all Medicare spending is used to treat chronic care, as 80% of Medicare beneficiaries have some form of chronic illness -- in effect making Medicare a "chronic care coverage program." Medicare, however, "was designed to cover acute care," not chronic care, failing to cover benefits typically used by those with chronic illness, such as prescription drugs and long term care. According to the brief, most private insurance plans fall along similar lines. And while Medicaid, with its more comprehensive benefit package including medical care, drugs, long term care and support services, is "better designed" to treat chronic patients than Medicare, its "means-tested" nature "discourages some people who are eligible from enrolling. In addition, Medicaid's joint federal-state funding mechanism makes it "subject to greater [state] budgetary pressures," which can lead to "underpayment" of services for chronic conditions. As a result, most people with chronic conditions "end up paying considerable sums for their care." The Harris survey found that individuals with chronic conditions on average pay $369 in annual out-of-pocket costs, compared to $182 for those without chronic conditions.
Coordinating a Solution?
Calling a need for reform of America's chronic care system, the issue brief states that "Medicare, Medicaid and private insurance all undervalue preventive care or health maintenance [that] can help minimize the deleterious effects of a chronic condition." The brief lists several "innovative programs," such as social HMOs -- San Francisco's On Lok program and the Minnesota Senior Health Options project, for example -- that are attempting to integrate and coordinate chronic care and social services with Medicare and Medicaid acute care services. The brief states, however, that these programs "have had difficulty generating large enrollments because of certain restrictions," including limitations on choice of doctors. The brief concludes: "People with chronic conditions are heavy users of acute and long term care services and programs, and account for the bulk of public spending on health care. Rapidly rising expenditures combined with a growing proportion of the population with chronic care needs will continue to place a great deal of stress on existing systems until these systems are redesigned with chronic conditions in mind" ("America's Most Ignored Health Problem: Caring for the Chronically Ill," June 2001). The brief is available
here. Please note that this link is available to Web readers only. You will need Adobe Acrobat Reader to view the brief.