The following statistic from the Centers for Disease Control and Prevention (CDC) never fails to shock: the 133-million adults – or “nearly 1 in 2” — with chronic disease account for 75% of spending. Engaging those high utilizers, the story continues, will help bring healthcare spending under control.
This storyline is a classic healthcare urban legend. Essentially nothing in that paragraph makes sense as a matter of policy, or even arithmetic.
Yes, the CDC got their arithmetic wrong. 133-million Americans comprise about 60% of adults, not “nearly 1 in 2.” Second, their definition of “chronic disease” specifically includes stroke, which is a medical event, not a chronic disease, and cancer, many of which would not fit that definition either. (Sloppy editing and arithmetic is a CDC trademark. They also observe that ”almost 1 in 5 youth…has a BMI in or above the 95th percentile” on their growth chart, which of course is mathematically impossible as written.)
Third, speaking of definitions, how are they defining “chronic disease” so broadly that 60% of us have at least one? Are they counting tooth decay? Dandruff? Ring around the collar?
Corrected or Not, The Statistic Itself Makes No Sense
The statistic is intended to demonstrate that a concentration of costs among people with out-of-control chronic disease but actually shows the opposite. It shows a diffusion of costs, not a concentration. 60% of adults accounting for 75% of spending – or even the incorrect 50% of adults accounting for 75% of spending — is about as far from a 20-80 rule as one can get. Basically costs are not concentrated in ongoing day-to-day chronic disease.
Second, that 75% covers all expenses of that 60%, not just being out of control and needing to go to the hospital, which seems to be the underlying assumption behind the flurry of activity designed to engage these people and control their conditions. Quite the contrary: in many conditions (rare diseases, high blood pressure and asthma come to mind) preventive drugs already overwhelm medical events as a expense category. In a typical commercial or even TANF Medicaid population, only about 10% of hospitalizations are for the five “common chronics” of asthma, diabetes (and its complications), CAD, COPD and heart failure. (In Medicare this percentage and absolute number are much higher – that is indeed a population where control of chronic disease matters.)
Third, “all expenses” means “all expenses” on that population, including those that are unrelated to the chronic disease, like being in a train wreck.
Fourth, a few of those people with chronic disease are high spenders due to the nature of their specific disease. Some rare chronic diseases require six-figure annual expenditures on drugs alone.
Fifth, the truly out-of-control high chronic utilizers usually differ year over year. You know who had a heart attack last year but you don’t know who is going to have one next year. So you don’t know who to spend your time engaging.
The bottom line: in a commercial population there is very little cost to be saved by focusing on trying to get more people to take more drugs to control their conditions.
Engagement May Not Work
Let us assume that despite all that, there are some number of patients who are worthwhile to engage. How well is this engagement strategy likely to work?
In my next book, Cracking Health Costs, I title the chapter on ACOs and patient engagement: “Déjà Vu All Over Again, Again, Again.” The ACA era is the fourth time health care pundits have “discovered” engagement. The first was HMOs, in which doctors were supposed to help patients maintain their health (hence the name) but which devolved into a cost-containment tool. The second was disease management, which involved connecting people with chronic disease to live nurses on the phone. That didn’t engage people. Third, wellness was supposed to accomplish the same thing for a much broader pool, engaging people through a combination of bribery (called “incentives”) and coaching. That not only failed to work, but it turns out virtually all wellness vendors who claim cost savings are simply making up results. As was extensively chronicled in Why Nobody Believes the Numbers, anyone with any basic understanding of study design would find these alleged results to be hilariously transparent lies, in the case of at least one major carrier quite purposefully designed to fool benefits consultants. These vendors have invariably found that the cost of engagement exceeds the benefits.
So perhaps the fourth time, engagement will be a charm, because it involves risk-bearing physician practices and medical homes and electronic medical records. Well, that’s been tried too. On a large scale, North Carolina Medicaid has attempted for more than a decade to engage members through a statewide medical home. Following years of cost overruns and massively high per capita spending, the program – maintained until now only because the proponents paid several sets of consultants to lie for them – is being dismantled by the state if the governor’s plan goes through. Even so, physician practices should be more successful in engagement – the patients know and trust them to begin with – but they would have to be very successful in reducing utilization to cover the very high costs of one-on-one face-to-face engagement.
Engagement isn’t even always automatically the right answer. I have blogged previously about how I am a non-engaged patient because the things that my doctor has wanted me to do have been absurdly expensive and not-evidence based…and yes, I am in a risk-bearing PCMH with an electronic medical record. Sometimes the patient is wise not to engage.
Notwithstanding that type of negative experience with engagement (not my first), there is probably some marginal benefit to engagement (and in the Medicare population, probably substantial benefit) but this obsession with engagement takes our eyes off some of the bigger cost drivers of overdiagnosis, overtreatment, and expensive new technologies of marginal value.
Not to mention medical errors, which may be the most pervasive, debilitating and expensive issue of all. Don’t believe me? Next time you are in a group, ask people to raise their hands if they or a loved one was admitted to the hospital due to a failure to engage. Then ask how many of them or their loves ones have been victims of medical errors. Count the hands, and then tell me that the latter isn’t much more important than the former.
Finally, there is a solution to engaging people en masse to change behaviors, and it has essentially nothing to do with the delivery system. It’s called public health and it’s the role of government. Raise taxes on cigarettes, institute taxes (collected at the producer level) on sugar, corn syrup, transfats etc. Basically, raise the price of bad behavior. To then encourage good behavior, earmark that money towards upgrading of recreational facilities, rail trails, subsidizing farmers markets in underserved neighborhoods. Basically, make it easier and cheaper to be healthy.
Instead, the current strategy, which places the onus for engaging patients in behavior change on employers and doctors, could be called the privatization of public health. It’s an inefficient and ineffective substitute for the real thing, and is about as likely to work as the many attempts at cost-reduction-through-engagement which have preceded it.
Al Lewis, author of Why Nobody Believes the Numbers and co-author of Cracking Health Costs, is president of the Disease Management Purchasing Consortium. A previous version of this posting appeared on The Doctor Weighs In.
Each of us is an anomaly; few fit the norm in most categories. Patient assessment of biostatistics of their existing or potential condition would probably reduce costs. I am a dreamer.
Al, while I appreciate you bringing an understanding of data to the debate, it also seems like some of your points are disingenuous.
When CDC says that 20% of the population is above the 95th percentile in BMI, it seems like they mean that within a given fully healthy population, there would still be a distribution of BMIs, and that 5% would have a BMI of say 30 or greater. The way you can tell that our population is unhealthy is that 20% of our population has a BMI above 30. Obviously, only 5% of any given population can have a BMI above the 95th percentile within that population, but that fact tells you absolutely nothing about the health of the population, it simply tells you you understand population distributions.
Furthermore, their recommendations are not related to increased prescription drug use, but rather reduced alcohol consumption, elimination of smoking, increased physical activity, and better nutrition. Which of your fancy data analysis techniques shows that these are bad recommendations?
Finally, if you took the CDC’s recommendations to their logical extremes and assumed everyone followed their 4 recommendations, it is definitely possible that per-person healthcare costs could go up, but those costs would likely be spread out over much longer, more productive lives and the productivity gains would probably offset any cost increase. And, I’m sure the services we as a society were purchasing would be a much better use of our healthcare dollars.
Your article is clever, no doubt, but does it advance the debate? I have my doubts.
Is there a website which shows the largest claims paid by Medicare in a year? That would be interesting to me.
According to a post on the EHow website, a typical diallysis patient runs up the following cost in a year:
$19,000 for dialysis
$9000 for medications
$9000 for doctor’s care
$8000 for supplies, transportation and lab work
$24,000 for hospitalizations
And that is with a high degree of disease management — a nephrologist, a nurse, a dialysis technician, etc., maybe even a social worker also.
I have always said that health care alone is not as expensive as the prevention of death. The real savings, if we are desperate for savings, would be from faster deaths.
well put. I think your cost exaimtes are way low,though. Those might be costs and not claims paid. Still ,your point is an excellent one.
“estimates” — sorry. You must have thought I was speaking in tongues.
Well, if you could get patients engaged then on balance I think we’d be better off. Your comment is quite nuanced and appropriately so. I just suspect it’s much harder than one would think to do so, and also the obsession with it causes people to ignore the other major sources of opportunity in the system.
You are so right – the numbers, even if directional, represent distribution of cost, not concentration. EOL is probably the only meaningful concentration that can be addressed using palliative care.
However, don’t you think that engaged patients will actually solve many problems? Not all, but many. You are probably not questioning that engaged patients will be a positive change as much as you are questioning the ability (and cost) to engage them given past failures. So why the fourth time could be the charm? Technology is different today than even five years ago. The argument around historical failure of DM does not account for the ability to reach patients in entirely new ways, with new triggers (as against based on schedule), and new information. Will the new weapons be adequate? I don’t know. But they sure give more to fight with now than ever before!
PE might not be the panacea but a step forward. Would you agree?
I totally agree, glad you, like many in the public are pointing to the numbers and realize 2+2 does not = 7, no matter how many times they try to convince us it does.
You said it well, “hilarious” findings of so many studies, even elementary students could not come up with some of the “findings” or “conclusions”. The deception is ridicules! I am not sure they expect anyone to buy the findings, but who is going to object? People like you sir, I tip my hat.
Your independent assessment of your medical choices and your decision to do otherwise is patient engagement and it seemed to trigger cost savings from unnecessary treatment.
Not to be a nit picker, but…your math is wrong too. US population is over 300 million, so 133 million is less than half (about 45% or “nearly half”).
Glad that someone is paying attention to the numbers so the spirit of your comment is appreciated, but 133MM is about 60% of adults, not 60% of total people.
I believe that a large porton of Medicare costs is spent on those sad individuals who are in a nursing home to start with, often become ‘dual eligibles’, and in their last year of life they experience multiple organ failures
They go back and forth between the nursing home and a hospital.
The average cost is at least $70,000 per person.
No amount of engagement can change the fact that their bodies are falling apart. There is often plenty of engagement at the nursing home, where someone looks in on them several times a day.
My father was in this group in his last year of life. He was treated well, I have no complaints
But the billings? My gut feelings is that all hospital and nursing home charges for the terminally ill should be slashed by 70%. Of course we do not always know exactly who is terminal, but it is not that hard to judge.
“speaking of definitions, how are they defining “chronic disease” so broadly that 60% of us have at least one? Are they counting tooth decay? Dandruff? Ring around the collar?”
Q: What’s the definition of a “well person”? (e.g., “no active problems” in the Meaningful Use Problem List Stage 1 Core Measure)
A: A patient that hasn’t been sufficiently worked up.
I like your default to palliative in EOL care
How to make it happen? Tough sell to those who irrationally fear death and deify technology.
Well, it’s never easy to sell anything to Congress, especially when no healthcare interests with money benefit and therefore all the lobbying money goes to the other side, as would happen here.
This is facilitated in that there is no benefits/coverage change involved, meaning nothing to oppose.
Are you getting invites to parties from consultants yet?
I think the problem can be stated as: Big Agra and Big Food Make us sick. Big Pharma medicates us. Big medicine manages the relationship. All make money, health suffers-much of the cost occurs in the 65+ population so the public, us, is left to pick up the tab.
We do not have a health care system. We have a sick care system.
Keep up the great work.
Many patients opt for “quality of life” over quantity. Who are we physicians to stop them from their own choices and self-destruction? One could say we all pay for this! But who among us truly maximizes our biological well being? As humans we all have other legitimate values besides biological health.
My issue is how to confront the costs associated with death and dying in the US which are excessive. Patient, Doctors and our still young US culture may someday mature around this issue?
We’ll see if we are ready to grow up?
Dr. Rick Lippin
well, my solution is kinda facile but…
Since so many people simply accept the default they are handed, why not change the default for EOL care to palliative? If you don’t make a choice you get comfort/hospice/palliative level of care.
Absolutely. I think the difference is that people are coming to this conclusion like it’s something brand new that no one has ever thought of. It is indeed “still the right way to practice medicine” but that doesn’t mean tons of doctors and patients who weren’t already with the program are suddenly going to get religion and start engaging with each other because an ACO says they should
Patient Engagement may not be THE answer (nor may Population Health, Price Transparency, or any other number of buzzwords) but that doesn’t change the fact that good doctors should engage patients. It is still the “right” way to practice medicine.
Why didid you spend so many years in the disease management industry if it did not work?
Good q. I was the first to arrive at that party…but I was also the first to leave. Google on “father of disease management says his baby is ugly”.
Not unlike a lot of engagement aficionados reading this blog today (and especially people in wellness) I was passionate about my cause because it saved so much money. Except that it didn’t. I kept working through the calculations using small sets of hypothetical figures and I couldn’t get the numbers to add up. It turned out there was a hidden major source of regression to the mean that I hadn’t seen.
The difference between me and the wellness people (and the remaining supporters of North Carolina Medicaid’s medical home) is that I was not one of the 90% in John Kenneth Galbraith’s quote: “Faced with a proof that their belief is wrong, 90% of people will get to work defending their belief.” I did the proof, learned that my belief was wrong, and changed course 180 degrees.
Al, actually the correct quote is “father of disease management says his KID is ugly.”
I feel justified in correcting you since I made the original observation:
Some of the really bad behaviors (excess alcohol and tobacco, for example)
lead to early deaths…which while tragic in themselves, do not cause all of our health costs.
A cautious senior citizen who eats health and drives safely for 90 years and then gets Alzheimer’s can cost more in lifetime health costs.
It is an American habit to think that health care can be solved by individual behavior. See the work of Joseph White for the futility of this approach.
The folks (pretty much all of us) who engage in bad behaviors (don’t take my surgar-filled drinks, don’t say I cannot drive at high speeds on rural roads, don’t even think about restricting my access to an AK-47, don’t spend my tax money on wasted rail service, etc, etc) are folks who send like minded persons to congress, which is where the the national public health initiatives will be considered, ridiculed, and rejected. We find ourselves, in the public sphere, in an intellectual 3rd world country. Not even the crumbs from your pie will reach the ground. Too bad for us.
So Al, who do I talk to about my wish to have you replace Kathleen Sibelius?
Not sure I’m ready for a job where I have to get dressed up everyday, but I suspect the position is still open for Sec’y Sebelius’s remedial biostatistics teacher.
>>Not sure I’m ready for a job where I have to get dressed up everyday<>I suspect the position is still open for Sec’y Sebelius’s remedial biostatistics teacher.<<
Ok then, I'll get right on it.
Engagement is useless. Activation is critical. Patient activation – getting someone to feel less like a spectator and more like a *participant* in their health/healthcare is what’s gotta happen.
Kyle got activated and lost 80 pounds. Finding the on-switch to activate someone in the direction of healthier choices is the challenge.
Activation is what happened when you canceled your sinus CT, too. It’s all about feeling like the outcome (a) matters to you and (b) is in some part up to you.
Great post. I agree, I tend to think that patient engagement is an overhyped buzzword.
I try to always compare complicated things I don’t understand against things that I do. For example, over half of the country if overweight or obese. That didn’t happen by accident. People by and large don’t care. I find it hard to believe that patient engagement will really help patient’s lose weight.
I am someone that’s lost 80 pounds. And I’ve thought to myself, what would it take to help others do the same thing. Doctor’s are not the right individuals to help lead lifestyle changes. Most of the change has to come from within. The next most important thing to making real life style changes are support from friends and family.
So if anything, I think patient engagement should be about the education of patients’ family and friends to help support those that need to make lifestyle. Social pressures are extremely powerful motivators. They are the key to chronic care management.
Great job, Al. I will read your prior publications and your new book with interest.
You probably remember the old propaganda that spending on drugs would be compensated for by reduced spending on hospitals.
Well, we have reduced hospital stays and hospital admissions, but with precious little reduction in hospital spending. We can thank upcoding and graded fee schedules for that.
And then the new drugs are often far more expensive than even 5 hospital stays.
Price controls on drugs with no substitutes would probably lower medical costs far more than engagement, far faster, and with no extra employees needed.
Bob Hertz, The Health Care Crusade