Psychiatr News October 20, 2006
Volume 41, Number 20, page 8
© 2006 American Psychiatric Association
Action Needed Now to Control Costs of Chronic Illness Care
Rich Daly
An overemphasis on drug development and insufficient data on the most
effective ways to treat patients mirror factors driving costs in other areas
of long-term medical care.
A lack of data on best treatments and payment systems that encourage
quantity over quality will continue to increase the cost of long-term care for
mental illness and other chronic conditions, leading researchers said last
month in a Capitol Hill briefing on the rising costs of care for people with
chronic illnesses.
Health researchers from academia, government, and industry participated in
the briefing, which was sponsored by nonprofit health care groups, including
the Robert Wood Johnson Foundation and the Alliance for Health Reform.
The researchers agreed that although long-term illnesses are among the most
expensive to treat for both the private and public health care systems, it is
possible, albeit challenging, to identify ways to contain costs. They
emphasized that future research efforts need to identify the best and most
cost-effective courses of care over the long term, instead of the current
focus on cost-saving measures for brief illnesses.
"Longitudinal measurement and shared accountability counter the
upward pressure on prices and the likelihood of medical errors," said
Elliott Fisher, M.D., of the Dartmouth Atlas Project, a research group at the
Center for the Evaluative Clinical Sciences at Dartmouth Medical School that
aims to describe how medical resources are distributed and used in the United
States.
Fisher's research found that the two-year cost of care for chronically ill
Medicare recipients varied by location around the country, sometimes by as
much as nearly 100 percent. The cost differences stemmed from disparities in
hospitalization use, visits to specialists, and choice of medications. Such
disparities were driven by clinical judgments, policies that encouraged the
use of all available resources, and policies that promoted fragmentation of
care among several types of clinicians, said Fisher, a professor of medicine
at Dartmouth Medical School.
He told Psychiatric News that these same pressures also drive
costs and variations in care among psychiatric patients. More research is
needed, he said, to identify the long-term treatment approaches that will
provide the best outcomes in the most cost-efficient manner.
"Right now we focus way too much on drug development instead of on
finding the best health care delivery systems," Fisher said.
Medicare Highlights Problem
Barry Straube, M.D., chief medical officer at the Centers for Medicare and
Medicaid Services (CMS), said Medicare, for example, is structured to reward
health care clinicians for the volume of care they provide, not the outcomes
of that care.
"You get to do more, regardless of outcomes," he said.
Only long-term studies can identify the most cost-effective ways to
diagnose and test patients, track effective medication use, and identify the
best settings in which to treat different types of patients, he said.
"We need to figure out how we can return the payment system to where
it is no longer driven by what patients can most afford" and focus
instead on what treatment settings and interventions represent the best level
of care, straube said.
Sam Nussbaum, M.D., executive vice president and chief medical officer of
WellPoint inc., one of the country's largest insurance companies, said that
the huge growth expected in the number of older patients with chronic diseases
in the coming decades has increased the pressure to study long-term care to
control costs. CMS estimates the number of Medicare beneficiaries who will
require long-term care will climb from fewer than 45 million now to more than
76 million in 2030.
Nussbaum noted, for example, that studies have found that dementia patients
in Medicare and in private insurance programs have huge variations in costs
for similar care. He cited research that found that up to 30 percent of
funding in additional medical care fails to result in positive health
outcomes.
The need for cost controls on care of the chronically ill in both public
and private health care systems, the researchers agreed, has been illustrated
by repeated studies. For example, a June 2005 study by the Center for American
Progress, a liberal nonpartisan group, found that the top 10 percent most
expensive non-institutionalized Medicaid beneficiaries account for nearly
three-fourths, or 72 percent, of Medicaid spending. This and other research
suggested to Nussbaum that potentially large cost savings might be realized by
better managing the care of these high-cost beneficiaries.
Solutions Suggested
An increased use of health information technology could reduce both medical
errors and costs, Straube said. More controversial ways to control long-term
costs, he added, are to publicize treatment price and outcome data to the
public and initiate pay-for-performance programs for physicians.
He touted an ongoing federal transparency initiative and the goal of the
Department of Health and Human services (HHS) to provide price-comparison
standards. One of the earliest efforts by HHS in this area was the posting of
comparisons of Medicaid prices for the most common elective medical
procedures, such as hip and knee replacements, on the HHS Web site in June.
Six HHS pilot sites will collect and publicize price information for
treatments in specific areas of the country, and HHS plans to expand the
program to 60 sites.
Another initiative aims to increase the applicability of
pay-for-performance measures by following Medicare beneficiaries assigned to
group practices, which is likely to provide more useful data in this area than
following patients assigned to a solo practitioner.
Although Straube highlighted President George Bush's recent executive order
mandating that federal agencies share information on quality and cost of
medical care and provide incentives for the public to choose
"high-quality" providers, no lasting changes are possible without
public and private information-sharing partnerships, he said.
Nussbaum noted the increasing efforts of private and public health care
systems to identify costs and enlist the public in controlling prices. He
cited the recent Aetna price-comparison program that displays what the
company's reimbursement is for each participating physician. The program does
not address differences in care, which the company leaves up to an online
system that allows patients to rank their own physicians.
A growing number of initiatives in the public and private sectors also
provide financial incentives for those with chronic illnesses to help control
costs by encouraging them to participate in patient education programs,
Nussbaum said.
More information on the Capitol Hill briefing is posted at
<www.kaisernetwork.org/health_cast/hcast_index.cfm?display=detail&hc=1877>.
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