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CONTROL DIABETES,SAVE MEDICARE
ABSTRACT
The combination of enrollment growth and the poor health of beneficiaries presents serious implications for the costs and ultimate solvency of Medicare. In fact, the Medicare Board of Trustees has projected that the health insurance trust fund will become insolvent by the year 2029. The literature clearly identifies the major cause of cost escalation for the Medicare program to be the chronic disease epidemic, especially the occurrence of type-2 diabetes, which accounts for over 40 percent of annual Medicare costs.The current system of healthcare delivery and financing in the United States is not effective in diagnosing, preventing and treating diabetes, focusing on the management of the disease, with little incentive to prevent the occurrence of the disease.Therefore, the way that diabetes is approached in this country must change. It is going to take disruption, through collaboration and communication to successfully address thehigh-risk health behaviors of our population. This paper provides a discussion on the economic burden of type-2 diabetes, the challenges faced to address this epidemic and the development and implementation of new strategies to meet the challenge of improving population health to save Medicare.
Keywords: Medicare solvency, type-2 diabetes, chronic disease management, disruptive innovation, population health
INTRODUCTION
The Medicare program began operations in 1965 as part of title XVIII of the Social Security Act. The primary focus of the program is the provision of health insurance to cover the healthcare costs for Americans sixty-five years of age and older. The program was later expanded to further cover individuals with disabilities and those with end stage renal disease.As of 2016,Medicare provides more than 47.8 million Americans aged 65 and olderhealth coverage andwith nearly 10,000 baby boomers reaching the Medicare eligibility age daily enrollment is projected to increase by 64 percent over the next 35 years (The Medicare Trustees Report, 2017).Many people on Medicare live on modest incomes, have multiple chronic conditions and cognitive impairments, and have limitations in their ability to perform daily living activities (Kaiser Family Foundation, 2017).The combination ofenrollment growth and poor beneficiary health represents serious implications for costs and the ultimate solvency of the health insurancetrust fund, in fact it is estimatedthat by 2029 the fund will be depleted(The Medicare Trustees Report, 2017).
The root cause of thislooming insolvencylies with the costs associated with the growing chronic disease epidemic, specifically the alarming increase in the rate of preventable diabetes mellitus, or type-2 diabetes. The Centers for Disease Control and Prevention (CDC, 2017) recently reported that 30.3 million Americans have diabetes (approximately 9.5% of the United States population and 40% of the Medicare population), and a staggering three times more than that number are already in a pre-diabetic state, with nine out of ten individuals unaware they are living with a pre-diabetic condition. Ifcurrent trends continue, as many as one in three adults in the United States could be diabetic by 2050(American Diabetes Association [ADA], 2012).Furthermore, improperly managed diabetesdramatically increases an individual’s risk for heart diseases, stroke, kidney disease, blindness, nerve damage, limb amputations, and death.
The incidence and prevalence of chronic diseases, and specifically type-2 diabetes, in the United States provide clear evidence that tremendous change is necessary to maintain our health and the solvency of Medicare. Fortunately, there is an enormous amount of scholarly research available clearly documenting that type-2 diabetes and its complications are readily preventable through improving lifestyle and dietary patterns (Asif, 2014). The major public health efforts to fight the chronic disease epidemic include health education programs and management programs designed to prevent the disease and/or the complications that may arise as the affected individual grows older. However, the onset of chronic disease is rather slow, with a very long incubation period, complicating the prevention and disease management program development process and making evaluation of program success or failure extremely difficult. These programs are also very expensive to develop and sustain with limited evidence to support that the large investment in programming will return significant improvements in the future health of the population.
Just because these health education efforts posechallenges is no excuse for not addressing the need for a more aggressive attempt to improve the overall health of the population.There appears to be an overriding agreement among health policy experts and those working in public health that the prevention of chronic diseases and their complications should be a priority for our healthcare delivery system. Despite agreement that something needs to be done, there is unfortunately no agreement on what (specifically) should be done. McGinnis, Williams-Russo, and Knickman (2002) highlight that one of the most important reasons why our country has been reluctant to invest in health education programs to address the chronic disease epidemic is because there is no consensus regarding the development, implementation, and evaluation of these initiatives in the prevention of high-risk health behaviors.
The following provides a discussion on the economic burden of type-2 diabetes, the challenges faced to address this epidemic and the development and implementation of new, innovative strategies to meet the challenge of improving population health to save Medicare.
The economic burdenof Diabetes
Diagnosed diabetes accounts for more than 20% of our nation’s health care spending, with the estimated total cost figured at $245 billion, of which $176 billion relates to direct medical costs and $69 billion relates to lost productivity (ADA, 2012). The average individual medical expenditures for people with diagnosed diabetes hovers around $13,700 per year, which is approximately 2.3 times higher than those without diabetes (ADA, 2012). With over 85% of the total healthcare costs focused on chronic disease management, the existing literature clearly agrees that the largest cost escalation driver in our healthcare system relates to the treatment of chronic diseases and their subsequent complications (Brantes & Conte, 2013; CDC, 2017). Furthermore, these health expendituresare expected to increase 5.6 percent annually, reaching just under 20 percent of the United States’ gross domestic product by 2025 (Keehan et al., 2017).Over this same period Medicare spending is expected to increase 7.1 percent, alarmingly, this figure does not account for the projected rapid increase of chronic diseases in this segment of the population.
Specific to type-2 diabetes, a recent longitudinal study showed adistressingupward trend in the overall economic burden(Rowley, Bezold, Arikan, Byrne, & Krohe, 2017). Between 2015 and 2030, it is forecasted that the total number of people with diabetes will increase 54 percentand the cost of diabetes will increase 53 percent to $622.3 billion (Rowley et al., 2017). Halvorson (2013) points out that over 40 percent of Medicare costs are related to the treatment of one disease, type-2 diabetes.To examine this cost on an individual basis, take for example a 50-year-old individual who develops diabetes. The projected cost for treatment over that individual’s lifetime (undiscounted) is $135,000. If that individual were diagnosed ten years sooner, the overall cost of treatment over the lifetime increases by 150% (Subramanian, Midha, Chellapilla, 2017).
Beyond the staggering costs of treating the disease, reported quality of life for the diabetic patient does not necessarily improve over time (Subramanian et al., 2017). Research by Dall et al. (2016) found serious gaps in diabetes education and care quality among those with diagnosed type-2 diabetes, and corresponding poorly controlled diabetes. Of those who were prescribed diabetes medication, 43 percent had medical claims that indicated poorly controlled diabetes, which positively correlates with an increased prevalence of neurological complications, renal complications, and peripheral vascular disease. Beyond those unfortunate complications, patients with poor diabetes control had annual healthcare expenditures that were $4,860 higher than those with controlled diabetes.
This epidemic call for the development and implementation of new strategies to meet the challenge of improving population health.One way to modify behavior and successfully combat the ramifications and challenges faced by the chronic disease epidemic is through disruption, collaboration and communication among community partners to provide health education to the population.These partnerships require public health and community officials, providers of healthcare, and philanthropists to work together to produce a healthy community.
CONTROLLING diabetes
The most important goal of a high performing healthcare system is to deliver care that improves the overall health of the population (Schneider & Squires, 2017). Schneider et al.(2017) believe that the improvement of primary care delivery represents a major challenge that must be met to improve the health of our population. While we know poor diet and physical inactivity are major contributors to the development of chronic diseases and related complications, the problem has always been how to properly educateand motivate the population to prevent a chronic disease from developing in the first place and, for those with chronic diseases, how to properly manage their condition to prevent complications. Changing two vital behaviors, diet and physical activity, are the keys to the improvement of the health of the population and involve the implementation of behavioral health, which is difficult to address.
With over half of the United States population living with at least one chronic disease andnine out of ten individualsunaware that they are living with a pre-diabetic condition, timely screening to identify those at risk is critical so steps can be taken to controlthese preventable diseases from escalating(CDC, 2017). This is where the healthcare delivery system needs to make certain that the healthcare providers have time available to talk with and share valuable information with their patients.This challenge leaves health policy makers with the task of designing incentives to make health education initiatives a major part of healthcare delivery in our country.
Another challenge is the current fee-for-service system of healthcare reimbursement thatincentivizes treatment over prevention. For type-2 diabetes this equates to focusing on the management of the disease, with little incentive to prevent the occurrence of the disease. Recognizing this ineffectiveness, one of the key priorities of the Affordable Care Act (ACA) stipulates that nonprofit hospitals mustcontribute to preventive care and population health by conducting a periodic community health needs assessment and subsequently developing an implementation strategy to address the identified health needs of the population they serve. Although the ACA marked the beginning of a new era in the provision of healthcare in the United States, the concern is that it has not gone far enough to minimize the occurrence of and complications from chronic diseases as a means of improving our country’s health and thereby reducing our healthcare costs and ultimately saving Medicare.
There is also a need to break down silos that have developed that virtually eliminate public health departments and other stakeholders from working closely with healthcare providers in the battle against the epidemic of chronic diseases in our country. Through a review of the existing literature, it became evident that a call for an increase in communication is necessary. One of the most important components towards the achievement of organizational objectives is communication across organizational boundaries(Ellis & Brown, 2017). This does not happen in siloed organizations, especially healthcare organizations. In fact, the extreme competition that is noted between healthcare providers blocks the potential for cooperation or collaboration because of their individual profit motives, despite the result of poor population health.
Public health problems are complex, requiring attention at multiple levels and involving many disciplines for a successful solution(Brownson, Baker, Deshpande, Gillespie, 2017). Complex public health problems, such as the epidemic of chronic diseases, require bringing together diverse groups of stakeholders that can develop new and creative ways to solve these complex issues and communicate the information to all involved for the betterment of society. The communication problem must be solved if our nation is serious about improving the health of our population and keeping the Medicare program solvent into the distant future.
This is an opportunity that cannot be ignored in our national attempt to save Medicare because it is achievable and can be accomplished with limited resources. One such example is theFresh Food “Farmacy” initiative at Geisinger, a physician-led integrated healthcare system serving more than 3 million residents throughout 45 counties in central, south-central and northeastern Pennsylvania and southern New Jersey.Recognizing the aforementioned challenges, Geisinger began addressing the need to empower diabetics to manage their medical condition thorough food-related behavior and life style changes. Geisinger’s Fresh Food “Farmacy” provides a low-cost, collaborative, holistic approach to patient care, addressing not only the medical needs of enrollees but also their social determinants of health, offering participants and their families free, nutritious food along with medical, dietetic, social and environmental services(Feinberg, Slotkin, Hess, & Erskine, 2017).Geisinger is breaking down the silos by taking a multidisciplinary team approach to diabetes management. This care team includes a program coordinator, nurse, primary care physician, registered dietitian, pharmacist, health coach, community health assistant, and nonclinical administrative-support personnel (Feinberg et al., 2017). The program also requires a collaboration among patients and their families, providers, payers, and external stakeholders.
Since the inceptionof the program in 2016 the results have been striking. Within 12 months of dietary changes and increased physical activity participants saw a more than two-point drop in their HbA1c levels(each one-point drop corresponds to a more than 20% decrease in the potential for disease complications and chance of death) and improvements in cholesterol, blood sugars, and triglyceride levels (Feinberg et al., 2017).Some participants were even able to reduce or eliminate their diabetes medications(Feinberg et al., 2017).Program costs are $2,200 per year per patient and Geisinger estimates cost savings on the payer-side to be around $5,000 to $8,000, a definitive financial benefit (Feinberg et al., 2017).If this program can be scaled nationally, the health of millions of Americans with diabetes would be improved, medical costs would be reduced, quality of life would increase and Medicare could remain solvent.
These results certainly support the value of increasing the amount of resources allocated to health promotion activities designed to address food-related behavior and life style changes, along with timely screening of high risk individuals.We must show more concern for our aging population, the increased prevalence of diabetes, and the subsequently expected increase in the economic burden of diagnostic and treatment costs.This calls for an improvement in patient data collection, better screening for and management for diabetes, as well as disruption and policy improvements to address the problem.
CONCLUSION
The cost and availability of healthcare services have emerged as very important economic issues and top priorities, allowing change in our way of delivering healthcare to become not only possible but desirable, producing a unique opportunity to fix our broken healthcare system. Our currently expensive and poorly functioning system of healthcare delivery in the United States is ready for disruption. In fact, the chronic disease epidemic, especially the significant diabetes problem being faced by Medicare recipients, may offer an opportunity to improve the American healthcare delivery system for everyone.
Poor diet and physical inactivity are responsible for the development and complications of type-2 diabetes and the keys to the improvement of the health of the populationlies in addressing these forces. Unfortunately, changing these two vital behaviors involves the implementation of behavioral health and patient education, which have been historically difficult to modify. Efforts to encourage providers to increase patients’ awareness of clinical indicators such as glycemic levels and control thereof are clearly needed. It is going to take increased collaboration between our healthcare system and public health departments to be successful in addressing high risk health behaviors for our population. The Geisinger “Fresh Food Farmacy” model holds promise.
This disruption will require much better use of health education programs designed to prevent chronic diseases and their complications in our population. Health education has never maintained a very important place in medicine because it has never been a profitable activity. This will require providing incentives to encourage healthcare providers to offer directed health education to their patients at every touch point.Incentives matter, and the way we pay for healthcare can very well cause a much greater emphasis to be placed on the prevention of disease and the complication from disease as the future predominant model of healthcare. By bringing together experts from many disciplines, our country will be able to take full advantage of the creativity and innovations that can come forth from such collaborations.