Highlight HEALTH

There are a lot of good reasons for people to lose weight and to quit smoking. However, according to a new study published in PLoS Medicine, saving money on lifetime healthcare costs isn’t one of them [1].

Researchers at the Netherlands’ National Institute for Public Health and the Environment used a simulation model to estimate lifetime healthcare costs for a hypothetical group of 1000 healthy-living people from age 20 until the time when the model predicted all had died. They made similar estimations for a group of people who were either obese (i.e. BMI > 30) or lifetime smokers with healthy weight. Healthcare costs from each group were then compared to the healthy-living cohort. Data from the Netherlands on the costs of illness was used by the mathematical model to estimate healthcare expenditures.

Perhaps not surprisingly, the model predicted that, until age 56, yearly healthcare costs were lowest for healthy people and highest for people who were obese. At older ages, smokers incurred the highest yearly costs of healthcare. However, due to differences in life expectancy (at age 20, life expectancy was 5 years less for people who were obese and 8 years less for people who were smokers), total lifetime healthcare spending was greatest for healthy people. The cost of nursing home care was the principle factor increasing the cost of care for healthy-living people.

Thus, strictly in terms of healthcare costs, prevention of obesity and smoking does not result in a cost savings, since people who are obese or are lifetime smokers are more likely to die earlier than healthy-living people.

It’s important to stress that the study focused exclusively on healthcare costs related to obesity and smoking. The study didn’t take into account other associated economic costs, such as reduced productivity or prescription drugs. Indeed, the authors suggest that, in the case of obesity and smoking, indirect costs and could be higher than direct medical expenses.

More to the point however, does the prevention of obesity and smoking require an economic savings in order to be appealing?

Not necessarily. The goal of healthcare isn’t to save money, but to reduce suffering and death. The Netherlands’ study concludes by stating that:

Prevention may therefore not be a cure for increasing expenditures — instead it may well be a cost-effective cure for much morbidity and mortality and, importantly, contribute to the health of nations.

To be cost effective, prevention has to produce optimum results for the expenditure. Specifically in healthcare, cost effectiveness is defined as the costs incurred as a result of a service divided by the health outcomes achieved [2].

Thus, review of cost-effectiveness is very useful for assessing value. Cost-effectiveness analysis should help improve the delivery of those preventive services that will lead to the greatest improvements in population health and the most efficient distribution of resources.

A 2006 study by the National Commission on Prevention Priorities identified the most valuable clinical preventative services that can be offered in medical practice [3]. The highest ranking services in terms of clinically preventable burden and cost effectiveness were:

• Discussing the benefits/harms of daily aspirin use for the prevention of cardiovascular events with men ≥40, women ≥50, and others at increased risk.
• Immunizing children against diphtheria, tetanus, pertussis, measles, mumps, rubella, inactivated polio virus, Haemophilus influenzae type b, hepatitis B, varicella, pneumococcal conjugate and influenza.
• Screening adults for tobacco use, providing brief counseling and offering pharmacotherapy.
• Immunizing adults aged ≥50 against influenza annually.
• Immunizing adults aged ≥65 against pneumococcal disease.
• Screening women who have been sexually active and have a cervix within 3 years of onset of sexual activity or age 21 routinely with Pap smears.
• Screening adults aged ≥50 years routinely with colonoscopy.
• Screening adults aged ≥65 routinely for diminished sharpness of vision.
• Measuring blood pressure routinely in all adults (hypertension screening) and treating with antihypertensive medication to prevent incidence of cardiovascular disease.
• Screening routinely for lipid disorders among men aged ≥35 and women aged ≥45 (cholesterol screening) and treating with lipid-lowering drugs to prevent the incidence of cardiovascular disease.
• Screening adults routinely to identify those whose alcohol use places them at increased risk and providing brief counseling with follow-up.

The take-home message? Very few preventive healthcare services save more money than the cost incurred. The value of healthy-living is reduced yearly healthcare costs earlier in life and increased life expectancy. Isn’t that what it’s all about?

References

1. van Baal et al. Lifetime Medical Costs of Obesity: Prevention No Cure for Increasing Health Expenditure. PLoS Med. 2008 Feb;5(2):e29. DOI: 10.1371/journal.pmed.0050029
   View abstract
2. Haddix A, Teutsch SM, Corso PS. Prevention Effectiveness: A Guide to Decision Analysis and Economic Evaluation. 2nd ed. New York: Oxford University Press; 2003.
3. Maciosek et al. Priorities among effective clinical preventive services: results of a systematic review and analysis. Am J Prev Med. 2006 Jul;31(1):52-61.
   View abstract

The Washington Post published an interesting article today on physician profiling.

In the fight to control healthcare costs, employers and insurance companies are now monitoring physican performance. Using sophisticated computer software to analyze millions of health claims and billing data, doctors are being profiled. Physician profiles are rated and used to direct patients to effective and reasonably priced healthcare.

According to the article:

The trend is in its infancy, but such programs are already in more than 100 insurance industry markets or regions across the country, from entire states such as Massachusetts to metropolitan areas such as Los Angeles. Supporters say the programs have slowed the rate of growth of insurance premiums by 3 to 6 percent in their first year.

However, such data-driven scrutiny is raising questions regarding the line separating oversite and interference in patient-caregiver relationships.

The effort is more about cutting costs than raising quality, some say, adding that doctors could begin to “cherry pick” healthier patients whose problems are less costly to treat. Such systems fail to capture the intangibles of quality, such as a doctor who visits a dying patient at home, critics say.

More importantly, the data, which often contains errors, is difficult for physicians to correct. These inaccuracies can not only damage a doctors reputation but have a significant financial impact.

Regardless of these problems and the controversy surrounding physician profiling, it’s likely that doctor ratings are going to become more widely used. The Wall Street Journal Health Blog citied a doctor at a benefits-consulting firm who believes the future of such physician scrutiny is unavoidable:

“In every industry, consumers have a thirst for performance information,” he tells the Post. “People don’t want to go to a movie or buy a book or buy a car or go to a restaurant without some ability to assess value for dollar. What’s taking place here is inevitable.”

Similar Health 2.0 resources are available online. RateMDs.com offers patients the ability to rate their doctor by scoring three areas: punctuality, helpfulness and knowledge. Along with ratings, users can leave comments. A more in-depth survey is used at DrScore.com, which evaluates patient issues including coordination of care, access to services and appointments, the quality of medical care and the efficiency of the practice.

Both of these websites as well as a number of other resources can be found in the Healthcare Reviews category of the Highlight HEALTH Web Directory.

How do you feel about physician ratings? Do you use any of the resources listed above or something similar?

The Organization for Economic Cooperation and Development (OECD) released a report last month on the state of the U.S. economy [1]. The report warns that the U.S. is headed for a budget crisis unless it reforms healthcare spending. Without reform, the report forecasts that healthcare costs will consume approximately 20% of GDP by 2050:

“The major entitlement programmes – Social Security, Medicare and Medicaid – are the main reason that government finances are on an unsustainable course. Under current law, public spending on retirement and health programmes is expected to rise toward 20% of GDP by the middle of the century; resulting soaring budget deficits would entail a government debt twice the size of GDP at that time. Raising tax rates to finance such spending would be an expensive and inefficient solution. Entitlement reform is therefore essential to address this longer-term fiscal challenge. The problem facing Social Security is population ageing. As the post-World War II baby boomers retire while increases in life expectancy continue, the ratio of people receiving retirement benefits to the working-age population will rise steadily. Relatively limited changes to programme parameters would suffice to put the scheme on a solid financial footing, but it has been difficult to reach an agreement on the appropriate measures.”

With Baby Boomers starting to retire and the lack of new workers to replace them, the government will be collecting less tax revenue while paying increased Social Security and healthcare costs.

Indeed, the National Bureau of Economic Research (NBER), a private, nonprofit, nonpartisan research organization dedicated to promoting a greater understanding of how the economy works, wrote in a working paper almost two years ago [2]:

” … the U.S. may well be in the worst long-term fiscal shape of any OECD country even though it is now and will remain very young compared to the majority of its fellow OECD members.”

Established in 1961, the OECD brings together governments of countries committed to democracy and the market economy from around the world. Their focus is to support sustainable economic growth, boost employment, raise living standards, maintain financial stability, assist other countries’ economic development and contribute to growth in world trade. The OECD shares expertise and exchanges views with more than 70 other countries around the world and, for more than 40 years, has been one of the world’s largest and most reliable sources of comparable statistics as well as economic and social data.

The OECD report suggests several fixes, including:

• Reducing the high replacement rate of the workforce and tightening screening requirements for disability benefits to ensure that they do not encourage people to stop working unnecessarily.
• Raising the retirement age to not only discourage premature retirement but to make the Social Security system financially more secure.
• Restraining taxation and government spending.
• Expanding trade adjustment assistance programs (including wage insurance and health-care support) to include additional, if not all, dislocated workers, regardless of the cause of dislocation.
• Raising the earned income tax credit.
• Reinstatement of statutory caps on discretionary spending and pay-as-you-go requirements for increases in mandatory spending and tax cuts.
• Broadening of the tax base.
• Reducing or abolishing tax expenditures that are distorting, ill-targeted and ineffective.
• Shifting the tax burden from direct taxes to consumption-based indirect taxes – such as a national sales tax or a value-added tax.
• Higher taxation of carbon-based energy consumption.

The OECD further proposes limited changes to the Social Security program parameters with an acceleration of the already legislated increase in the normal retirement age and indexing benefits for rising longevity, a reduction in replacement rates for higher earners and an increase in the taxable maximum amount of earnings subject to Social Security tax.

With regard to heathcare programs:

” … ways should be sought to improve efficiency in Medicare-related health delivery, so as to be able to limit payments to providers without affecting access to and quality of care. At the same time, premiums for higher-income beneficiaries could be raised further. Cost-conscious decisions would be encouraged by expanding individual health savings accounts and eliminating the tax bias towards high-cost insurance. The Administration has proposed to achieve the latter by replacing the unlimited tax exclusion of employer-furnished health insurance plan premiums by a tax deduction available to everyone. Arguably, a tax credit would have a greater effect on health insurance coverage.”

For those interested, a policy brief can be downloaded here.

I’ve written about this issue previously. Since September 2005, U.S. Comptroller General David Walker and both Democratic and Republican representatives have been touring the country as part of the Fiscal Wake-Up Tour, lobbying directly to taxpayers and opinion makers for extensive reform to both the Medicare program and the nation’s healthcare system.

This focus on healthcare costs and the U.S. budget is quite troubling. We’ve known for some time that as baby boomers age we’re going to run out of money to pay for the entitlements we’ve promised them. We are the American generation that truly promises enormous debt to those who follow - our children, our grandchildren and ourselves, many of us who will be in the midst of retirement.

Are you concerned?

Does the prospect of the U.S. government having no money available for anything beyond interest payments, Social Security, Medicare and Medicaid in just over 30 years bother you?

How many voices need to echo these warnings before anything is done?

References

1. Economic survey of the United States 2007. The Organization for Economic Cooperation and Development. 2007 May 29.
2. Christian Hagist and Laurence Kotlikoff. Who’s Going Broke? Comparing Growth in Healthcare Costs in Ten OECD Countries. The National Bureau of Economic Research Working Paper, No. 11833. 2005 Dec.