THCB

The Biggest Urban Legend in Health Economics–and How It Drives Up Our Spending

The wellness emphasis in the Affordable Care Act is built around the Centers for Disease Control and Prevention’s (CDC) 2009 call to action about chronic disease:  The Power to Prevent, the Call to Control.   On the summary page we learn some shocking statistics:

  • “Chronic diseases cause 7 in 10 deaths each year in the United States.”

  • “About 133 million Americans—nearly 1 in 2 adults—live with at least one chronic illness.”

  • “More than 75% of health care costs are due to chronic conditions.”

Shocking, that is, in how misleading or even false they are.  Take the statement that “chronic diseases cause 7 in 10 deaths,” for example.  We have to die of something.   Would it be better to die of accidents?  Suicides and homicides?  Mercury poisoning?   Infectious diseases?    As compared to the alternatives, it is much easier to make the argument that the first statistic is a good thing rather than a bad thing.

The second statistic is a head-scratcher.  Only 223 million Americans were old enough to drink in 2009, meaning that 60% of adults, not “nearly 1 in 2 adults,” live with at least one chronic illness — if their language is to be taken literally.   Our suspicion is that their “133-million Americans” figure includes children, and the CDC meant to say “133-millon Americans, including nearly 1 in 2 adults, live with at least one chronic illness.”   Sloppy wording is not uncommon at the CDC, as elsewhere they say almost 1 in 5 youth has a BMI  > the 95th percentile, which of course is mathematically impossible.

More importantly, the second statistic begs the question, how are they defining “chronic disease” so broadly that half of us have at least one?    Are they counting back pain?   Tooth decay?  Dandruff?   Ring around the collar?    “The facts,” as the CDC calls them, are only slightly less fatuous.   For instance, the CDC counts “stroke” as a chronic disease.   While likely preceded by chronic disease (such as hypertension or diabetes) and/or followed by a chronic ailment in its aftermath (such as hemiplegia or cardiac arrhythmias), a stroke itself is not a chronic disease no matter what the CDC says.  Indeed it is hard to imagine a more acute medical event.

They also count obesity, which was only designated as a chronic disease by the American Medical Association in June–and even then many people don’t accept that definition.   Cancer also receives this designation, even though most diagnosed cancers are anything but chronic – most diagnosed cancers either go into remission or cause death.    “Chronic disease” implies a need for and response to ongoing therapy and vigilance.  If cancer were a chronic disease, instead of sponsoring “races for the cure,” cancer advocacy groups would sponsor “races for the control and management.”  And you never hear anybody say, “I have lung cancer but my doctor says we’re staying on top of it.”

That brings us to the last bullet point.   Convention typically attributes more than 80% of healthcare costs to less than 20% of people, meaning that costly ailments are concentrated in a relatively small group.  Instead of this, the CDC’s data attributes 75% of costs to about 50% of the adult population, implying almost the exact opposite: the cost of chronic disease is widely dispersed.  Indeed, if you remove the rare diseases afflicting about 1% of the population but accounting for about 7-8% of cost, you come very close to parity between the proportion of the population with chronic disease and the proportion of total health spending attributable to chronic disease.

So What?

This urban legend, appearing verbatim more than a million times on Google, is among the single biggest causes of uncontrolled healthcare spending.

First, this statistic encourages employers and health plans to focus on the opposite of what they should focus on.  Penn State, citing this 75% statistic in their August 22 media advisory meeting as justification for its controversial wellness program, provides a classic example of this wrongheaded focus, with unfortunate consequences for the university’ reputation and employee relations, with no offsetting balance sheet benefit.     Overdiagnosis, overtreatment, and overprescribing are far more pressing issues in the commercially insured population than underdiagnosis, undertreatment and underprescribing in the name of “prevention.”  Regardless, the single-minded emphasis by employers and their benefits consultants on getting more employees to view themselves as chronically ill, or about to become chronically ill, contributes to medical overuse issues rather than addressing them.

Fanning these flames isn’t just a bad idea on its own.  It distracts employers from real issues such as provider pricing disparities, hospital safety, outliers (the small percentage of employees who really do account for half the cost–usually not due to a chronic ailment, though) and pharmacy benefit managers (PBMs), whose per-drug margins are about twice what they would be if anyone spent any time weed-whacking their obfuscations of rebates, implementation fees, etc. and simply negotiated the margin directly.  This whole misdirection brings to mind Peter Drucker’s lament that last frontier of good management in the American economy is the health care system.

Second, the implication that there is a 75% pot-o’-gold to be saved through prevention turns out to be anything but.  If you strip away the expenses of prevention and management itself (which represent a large proportion of that 75%), those aforementioned rare diseases, and unpredictable or uncontrollable exacerbations, you are left with about 7% of expenses fitting the category of events possibly preventable through wellness, even when wellness-sensitive medical event diagnostic code categories are defined broadly enough to include disease management-sensitive categories as well.  Achieving a 15% reduction in those categories – a feat rarely accomplished, which is why vendors never disclose this figure – would reduce overall spending by 1%, or about $60 per person or about one-tenth of the incentives commonly paid to employees to play along in these schemes.

What to do next?

It seems like all our posts end the same way:  stop poking your employees with needles.   We’ve analyzed wellness’s “ science,”  its math, its outcomes, its philosophy …and now its epidemiological premise.  Even as all their hokum has been debunked, the wellness industry has steadfastly refused to defend itself on this site or any other, because although many of the vendors appear to be incapable of critical thinking, they are smart enough to realize that facts are their worst nightmare.

Al Lewis is the author of Why Nobody Believes the Numbers, co-author of Cracking Health Costs: How to Cut Your Company’s Health Costs and Provide Employees Better Care, and president of the Disease Management Purchasing Consortium.

Vik Khanna is a St. Louis-based independent health consultant with extensive experience in managed care and wellness.  An iconoclast to the core, he is the author of the Khanna On Health Blog.  He is also the Wellness Editor-At-Large for THCB.

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Powerlifter
Member

You can always mix numbers and statistics up to create some kind of a rise. We’re all going to die at some point, the key is just to try and live our lives to the full and try to be healthy, get out running, eat well, lift weights etc. This is the key to long life.

Ryan Stacker
Guest

I think you do need to be careful what statistics are real and what are just written to cause a rise. Everyone needs to die of something and you’re hope it’s something painless and fast, right? The key is to stay healthy and continue daily walking, running, or weightlifting. You do that and you can extend your life quite a bit.

Mr.Cheap
Guest

It is good if we can reduce cost of diseases in each year.

Jackie
Guest

“Take the statement that ‘chronic diseases cause 7 in 10 deaths,’ for example. We have to die of something. Would it be better to die of accidents? Suicides and homicides? Mercury poisoning? Infectious diseases? As compared to the alternatives, it is much easier to make the argument that the first statistic is a good thing rather than a bad thing.” This is one of the most idiotic paragraphs that I’ve read in a long time. By definition, chronic disease means that a person lives with a long-term illness that negatively impacts his or her quality of life. Chronic illness takes… Read more »

free singing lessons
Guest

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Al Lewis
Guest
Al Lewis

Believe it or not, there are vendors who say you’ll get an ROI overnight. Health Fitness Corp even says you get one before you put the program in place, if you intend to put one in place. Beyond that, I’m not sure of the relevance of a slide ending in 2004. Screens have a negative ROI — that math has been proven in Health Affairs. Extra PCP visits are a waste of money — just in JAMA. HRAs generate more testing, also drive costs up. If all 3 major wellness components drive up costs it stands to reason that wellness… Read more »

Bogdan
Guest

How is wellness driving up health care costs? Where are the numbers associated with that claim? Take a look at slide 20…that’s a pretty flat line in my view: http://igpa.uillinois.edu/system/files/2007HealthConferenceMiller.pdf. Are we saying that wellness IS or WILL be driving up health care costs? Of course any ROI associated with wellness spending won’t happen overnight.

Bogdan
Guest
Jon Robison
Guest

Vik, from Hadler “Health adverse behaviors and cardiovascular risk factors may relate to the proximal cause of death, but they account for less than 25% of the hazard to longevity. This outcome explains why multiple assaults on health-adverse behaviors and cardiovascular risk factors have uncertain effects on mortality rates. They might change the proximal cause of death, but they do not alter its timing.” I am not arguing against the kinds of changes that are being discussed here – but only trying to put them into the bigger context of what it means to be healthy – they are part… Read more »

Vik Khanna
Guest

With all due respect to Nortin Hadler, his statement reflects the common physician’s ignorance of exercise’s impact on both novel and conventional risk factors, as well as many of the other things I’ve articulated elsewhere in other comments.

Death rates in the US have been in steady decline since 1960, and it is only lately that we have become concerned that the decline may stop or slightly reverse.

Jon Robison
Guest

Vik, Of course I am in complete agreement with what has been said about worksite wellness – I was responding to and have written further somewhere up the chain in response to what I felt was a trend towards blaming the victim for their lack of “optimal health” as a result of their failure to do whatever it is we see as the healthy behaviors de jour – most of which are constantly changing anyway and that is something to me that is just as unhelpful as the coercive nonsense that passes for health promotion at the worksite – and… Read more »

Vik Khanna
Guest

I hear you. My POV, shaped through personal experience, is that taking care my own health has always given me the strength and vitality to accomplish other missions. In my book, Ten Commandments of Faith and Fitness, which I co-wrote with Pastor Henry Brinton, of Fairfax Presbyterian Church, we advance the idea that people of faith often simultaneously bemoan the state of the world and believe that they’ve been condemned to a particular state of ill) health. We encourage people to envision themselves as the most important tool in their health toolbox, recognizing that when they take even the simplest… Read more »

Jon Robison
Guest

Vik,

Jon Robison
Guest

I would just like to inject a thought here – lest we forget – that all the interventions simple or not that are being discussed here – though they have some impact – pale in comparison to the effects of SES and especially economic disparity in terms of population health – Jon

Vik Khanna
Guest

What you say is true, but the broad swath of the population falls under the bell portion of the curve. They account for most of the medical care spending, are the ones affected by the perverse and pervasively incorrect messaging of workplace wellness programs, and are the ones who have the most to gain by implementing the things that people are discussing in this tread (especially the simplest strategies). At the ends of the curve are the wealthy (who are the least likely to have unhealthy lifestyle habits and need the least help) and the poor (the most likely to… Read more »

Tom
Guest

Back to the message: The Legend….The Myth. An authority speaks and statements are accepted. But the facts…the math…do not support the statements. “Just the facts, ma’am, just the facts.” I always especially appreciate the “mathematically impossible” zingers.

Vik Khanna
Guest

Indeed, and what obviously happened here was that the authority spoke what it knew people wanted to hear. Whenever that happens, any hope of critical thinking goes out the window, and the echo chamber takes over.

David Grainger
Guest

Wow, Im surprised reading these comments just how much 21st Century man (and woman) thinks they are in control of their own health and lifespan. Whether by healthcare (drugs, surgery) or lifestyle (diet, exercise). All the evidence shows that we have very little control at all. The reason this is an excellent article is because it exposes the entire “wellness industry” as a modern fad. Look at all the interventional studies on diet – I stress “interventional” (all the cross-sectional studies dramatically over-estimate impact, as discussed here: http://www.tcpinnovations.com/drugbaron/another-grim-day-for-big-science/). They show very small impact (or none at all) on rates of… Read more »

Peter1
Guest
Peter1

“All the evidence shows that we have very little control at all.”

“So dont smoke tobacco, drink alcohol in moderation, eat a balanced diet controlling body weight/fat percentage, and exercise regularly. Beyond that, its time to disband the “wellness” myth,”

David, I find your comment confusing, first we don’t have control, then you tell us how to get control.

If wellness does not extend our years would it at least make our years more healthy?

Al Lewis
Guest
Al Lewis

i think what David posted was the 80-20 rule of wellness. Controlling that small number of items will, in a population, be responsible for 80% of healthspan/lifespan improvement. I’m not even sure anyone else knows what the other 20% is — there are a lot of items in that other 20% (some excellent candidates for inclusion suggested in these comments) but there are also some that will prove to be wrong (remember when eggs and avocados were bad?) so David’s point is, just focus on the 4 we all know we should focus on. You don’t need HRAs and biometric… Read more »

David Grainger
Guest

Sorry Peter – I see the confusion. The situation is that the things we are told to do to be “well” have very little effect. Most have none at all (eat less eggs, eat more fish and so on and so on) or at least have never been proven to have any effect. Thats a very different position from the “Wellness Fad” which suggests every subtle variation our lifestyle has impact one way or another. But thats not to say that you have no control over your health or lifespan. Most is pre-ordained, but a little is available for you… Read more »

Peter1
Guest
Peter1

“And balanced diet, no smoking, little alcohol and lots of exercise is about the sum total of the “proven” interventions.”

What more would you want? If that’s all it takes then that’s what’s works, along with preventing accidents.

David Grainger
Guest

I dont want more – Im just pointing out that the simple things work, and the MANY MANY fads we keep hearing about, for the most part, dont. Im also pointing out that even these simple things work less well than you would hope – perhaps not even well enough to be worth bothering with if they make you unhappy. So they are not “all it takes” – they are all that are available, and even if you manage to follow them (which most people don’t, even when they try – sustained changes in behaviour are really very hard to… Read more »

Vik Khanna
Guest

I wish more people knew about the impact of exercise on mental health. As you point out, exercise is a critical antidepressive. I think that even many mental health professionals don’t know this. Nor do they understand that exercise not only make people feel better, it also makes them less bad (as measured on different mood scales). We may have to agree to disagree on the other impacts of exercise, because I think that they are substantially greater than you believe they are. Growing up as the son of a very mentally ill father, I can attest to the fact… Read more »

Peter1
Guest
Peter1

“and the MANY MANY fads we keep hearing about, for the most part, dont.”

What fads are in workplace wellness?

Al Lewis
Guest
Al Lewis

right now the fad is to line employees up to poke them with needles in order to give them some diagnoses. Somehow telling people that they are sick is supposed to create a culture of wellness. Never mind that the USPS Task Force, JAMA and every other reputable group says we are already drowning in preventive medical care and screenings (The Doctor Weighs In just blogged on it today).

Vik Khanna
Guest

Weight Watchers or any other weight cycling organization/program is another example of a workplace wellness fad, so are treadmill desks (or, my personal favorite, giving executives mini-bikes to put under their desks and telling to pedal away the day), and health risk appraisals.

Peter1
Guest
Peter1

“right now the fad is to line employees up to poke them with needles in order to give them some diagnoses. Somehow telling people that they are sick is supposed to create a culture of wellness.”

Not sure about the “poking” but helping employees avoid unhealthy behaviors seems a good thing. Vic Khanna avoids unhealthy behaviors and he’s a 20 year old masquerading as a 50 year old or so he says.

Vik Khanna
Guest

Peter: we agree completely that helping employees avoid healthy behaviors is a worthwhile endeavor. Indeed, it ought to be the core of a wellness strategy, but it isn’t in most places. Instead, employers poke (yes, biometrics as part of wellness is most certainly a fad), intrude see our post about Penn State), and coerce (with financial incentives). Then, they send their employees into the clinic in pursuit of care that the overwhelming majority of people don’t need. Completely lost on employers are salients facts such as that most people hate their work; workplaces are desultory; employers talk a good game… Read more »

Vik Khanna
Guest

David, the impact of fitness (specifically, aerobic fitness) on premature morbidity and mortality is overwhelming. You can find my discussions of this topic here on THCB or check out my own blog. I actually think that the problem is the obverse of what you state: the problem is not that people overestimate what they can control it’s that they underestimate how much they can shift risk, but too many don’t want to do the work. Your last paragraph is a nice summary of what it’s all about. For the people who do those things, the data are quite clear that… Read more »

David Grainger
Guest

I dont agree Vik. I dont think there is enough evidence that anything but the simplest interventions DO improve health or lifespan. In fact, most of the evidence is the other way – most large interventional studies show little or no gain from whatever the change was. The classic study was with a low fat diet – 30,000 women, 8 years on a low fat diet and NO reduction heart disease, cancer or overall mortality. It is cross-sectional studies that mislead – they show that people who are slim, fit and have healthy lifestyles enjoy much better health and lifespan… Read more »

Vik Khanna
Guest

I strongly recommend that you take a look at the work of Steve Blair and Tim Church, both formerly of the Cooper Institute in Dallas, where data from the long-running Aerobics Center Longitudinal Study continues to produce important insights. What’s powerful about the ALCS data is that it’s not an interventional study but a longitudinal analysis of a population to discern differences in morbidity and mortality, and it uses actual measurement of aerobic fitness (not self reported activity time, which is tripe). Blair, Church, and colleagues have shown repeatedly that fitter people live longer and use fewer medical care resources… Read more »

Peter1
Guest
Peter1

“But absent those strategies, there is virtually no hope at all of healthy, successful aging.”

For the general population on a statistical basis – NOT that those strategies don’t work, it’s just people don’t make them work – correct?

Vik Khanna
Guest

Yes, at the end of the day, it is up to an individual to decide whether or not to make the effort to put lessons learned from population health data to use. But, when prominent government agencies, such as the CDC, spin data to suit political ends, you start to see people lose confidence about what to believe.

This has made “health” a confusing and seemingly inaccessible commodity that everyone thinks they need specialized expertise to understand.

Medical care is the commodity.

Mitch Collins
Guest
Mitch Collins

As usual Al and Vik, excellent post. While there is the large issue of inefficiency and waste, and misguided wellness and prevention initiatives, the biggest issue I think is a combination of poor diet (primarily, not solely) and demographics; the population is aging. The sick care system deals with the symptoms, not their cause. My own hope is that my healthspan equals my lifespan. To do that I stay reasonably active (I walk 20 miles a week or so plus a little exercise) and am careful about what I eat, I am a paleo/primal guy. No grains, no sugar or… Read more »

sam
Guest

Assuming that the solution is to 1)educate people on the impacts of the industrial revolution and how food scientists have destroyed our food supply. 2)educate people on tobacco, alcohol , balanced diet controlling body weight/fat percentage, exercise etc” , the real issue becomes health literacy. We don’t learn this stuff in school like phys ed. Providers don’t do this since the billing codes were non existent until recently. The payers or employers are paying for this. So we still need to answer the question “Who is going to be responsible for health literacy ” . The employer,payer , provider ?… Read more »

Vik Khanna
Guest

Re-introducing health and physical education into the educational system is essential. I am an advocate for having them as part of the core curriculum from pre-K right up through graduate and professional education. The idea that you should stop learning about how to maximize your health just because you’ve graduated from high school is absurd. We should find a way to help people embrace the idea of being ‘everyday athletes’ for their entire lives.

Vik Khanna
Guest

Mitch…stay tuned. I should have a column up soon on Big Sugar. Your closing thoughts are right on point. It is time to shift the dynamics of government policies that, along with the gibberish promoted by CDC, have helped to lead current state of affairs. Your personal strategy is also right on. I tune my own strategy to hew to what the American Heart Associations calls the characteristics of ideal cardiovascular health. They are four behaviors (exercise; a high quality, calorie-managed diet [your is but one way of achieving that]; maintaining a healthy body weight [achievable ONLY if you do… Read more »

Al Lewis
Guest
Al Lewis

As luck would have it, a post similiar to this one just appeared on The Doctor Weighs In. While we talk about all the waste and over-focusing on prevention in the workplace, this post talks about how over-focusing on prevention hinders efforts in primary care. Same issue, different venue

http://www.thedoctorweighsin.com/is-prevention-or-treatment-the-heart-of-family-medicine/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+TheDoctorWeighsIn+%28The+Doctor+Weighs+In%29