How a Fraction of the U.S. Public is Driving Health Care Costs

Most physicians recognize that much of their time is devoted to caring for particular types of patients—the elderly or chronically ill. According to the National Institute for Health Care Management, almost 20% of all health care expenditures, or $275 billion, makes up only one percent of the population, while almost half of all expenditures were for only 5% of the American public. On the other hand, almost half of the nation accounted for only 3% of all U.S. health care costs. This type of high cost patient distribution is reflected in the government programs Medicare and Medicaid. In 2001, only 5% of Medicare patients accounted for 43% of program spending while 25% of members accounted for almost 85% of all expenditures. Almost a quarter of Medicaid members are elderly or disabled and account for 70% of the programs expenses. Much of the national debate about health care costs is about adding consumers to the roster of insured, but if the country hopes to rein in costs in the coming years, it will have to focus on this small portion of society that consumes a disproportionate amount of medical services.  The high utilization of health care services by a small segment of the work force also has many business groups and insurers re-examining their health plans. These organizations recognize that there is almost always a verified health issue, but there is also considerable waste that occurs. These “super utilizers” of health care are not the villains of this story, despite their considerable consumption of medical resources.  Most of these ill patients are victims twice over.  First they are struggling with at least one chronic health issue, and, secondly, they are victimized by a fragmented health care system that rarely dedicates the appropriate resources to improve outcomes.  Many of these patients do not have a primary care physician; many physicians are unwilling to treat chronically ill patients due to the high risk of complications and potential liability issues. Without the sustained, patient-centered care necessary to optimize treatment, many super utilizers must resort to expensive visits to emergency rooms. This fractured care system often results in repeated testing and therapies that are ineffective. More hospitals and medical organizations are developing programs that specifically target these types of chronically ill patients. Instead of a standard provider, these patients are treated by a team of health care professionals which may include nurses, doctors, mid-level practitioners, residents and mental health professionals. These teams initiate contact with patients on a regular basis to learn their status and determine if more intensive treatment or other assistance is necessary. In some cases, minor forms of assistance like providing food, medications or eyeglasses can stave off a crisis. Preliminary results from these programs suggest that they are helping patients cut down on unnecessary ER interventions or hospitalizations which save patients and hospitals money. In one study at University Hospitals Case Medical Center, the organization was able to reduce annual expenses for two high utilizers from $600,000 to $3,000 by using more regular interventions.

Written by:  Robert Moghim, M.D., CEO- Moghim Medical Consulting Inc.

Leave a Reply

Your email address will not be published. Required fields are marked *