Expenditure Share United States, 2003

Transcription

1 Expenditure Share United States, 2003 Source: MEPS Chronic Disease Share of MEPS Expenditure ( Percent ) Share of Health Care Expenditure Breast Cancer Colon Cancer Lung Cancer Prostate Cancer Other Cancers Heart Disease Hypertension Pulmonary Conditions Diabetes Stroke Mental Disorders Sum of 11 Chronic Disease

2 Population Reporting Condition Share United States, 2003 Source: MEPS PRC (Percent) Chronic Disease Share of MEPS Breast Cancer 0.2 Colon Cancer 0.1 Lung Cancer 0.1 Prostate Cancer 0.2 Other Cancers 1.2 Heart Disease 3.1 Hypertension 6.0 Pulmonary Conditions 7.4 Diabetes 2.2 Stroke 0.4 Mental Disorders 5.0 Sum of 11 Chronic Disease 25.8

3 Direct Cost By Chronic Disease US$, 2003 Disease Expenditure (Billions) PRC* (Millions) Expenditure/PRC (Thousands) Cancer Asthma Diabetes Hypertension Heart Disease Stroke Emotional Dist Total *PRC = Population Reporting Condition

4 Indirect Impacts (Based on GDP) US$ Billions, 2003 Individual Caregiver Disease Lost Work Days (NHIS) Presenteeism (Cornell Study) Lost Work Days (Metlife/AARP) Presenteeism (AACE) Total Cancer Asthma Diabetes Hypertension Heart Disease Stroke Emotional Dist Total

5 Comparison of Direct Cost and Indirect Impact US$ Billions, 2023 Direct Cost Indirect Impact Total Disease Baseline Optimistic Baseline Optimistic Baseline Optimistic Cancer , Asthma/COPD Diabetes Hypertension Heart Disease Stroke Emotional/Mental Dis Total ,363 2,458 4,153 3,030 *Indirect Impact Based on Nominal GDP

6 Nominal GDP Growth Optimistic Relative to Baseline US$ Billions Absolute Difference- L Percent Difference - R Percent

7 Breast Cancer: Incidence vs. Death United States, Per 100,000 Female Population Per 100,000 Female Population Death Rate - L Incidence Rate - R Source: National Cancer Institute

8 Colon Cancer: Incidence vs. Death United States, Per 100,000 Population Per 100,000 Population Death Rate - L Incidence Rate - R Source: National Cancer Institute

9 Lung Cancer: Incidence vs. Death United States, Per 100,000 Population Per 100,000 Population Death Rate - L Incidence Rate - R Source: National Cancer Institute

10 Prostate Cancer: Incidence vs. Death United States, Per 100,000 Male Population 40 Per 100,000 Male Population Death Rate - L Incidence Rate - R Source: National Cancer Institute

11 Other Cancers: Incidence vs. Death United States, Per 100,000 Population 100 Per 100,000 Population Death Rate - L Incidence Rate - R Source: National Cancer Institute

12 Cancer Death Rates U.S., Index 1979= Overall Cancer Breast Colon Lung Prostate

13 Heart Disease: Prevalence vs. Death United States, Per 100,000 Population 400 Percent Death Rate - L Prevalence - R Source: Centers of Disease Control and Prevention

14 Diabetes: Prevalence vs. Death United States, Per 100,000 Population Death Rate - L Prevalence - R Percent Source: Centers of Disease Control and Prevention

15 Stroke: Prevalence vs. Death United States, Per 100,000 Population 80 Percent Death Rate - L Prevalence - R Source: Centers of Disease Control and Prevention

16 Obesity Projections (BMI >= 30) United States, Percent Baseline Optimistic H is to ry Fo re c as t Sources: BRFSS, Milken Institute

17 Overweight Projections (25<= BMI<30) United States, Percent Baseline Optimistic H is to ry Fo re c as t Sources: BRFSS, Milken Institute

18 Smoking Projections United States, Percent Baseline Optimistic H is to ry Fo re c as t Sources: BRFSS, Milken Institute

19 Exercise Projections United States, Percent Baseline Optimistic H is to ry Fo re c as t Sources: BRFSS, Milken Institute

20 Drinking Projections United States, Percent 9 8 Baseline Optimistic H is to ry Fo re c as t Sources: BRFSS, Milken Institute

21 Cholesterol Projections United States, Percent Baseline Optimistic H is to ry Fo re c as t Sources: BRFSS, Milken Institute

22 Sodium Consumption Projections United States, Per Capita Baseline Optimistic H is to ry Fo re c as t Sources: USDA, Milken Institute

23 Red Meat Consumption Projections United States, Per Capita Pounds Baseline Optimistic H is to ry Fo re c as t Sources: USDA, Milken Institute

24 Estrogen Projections United States, Percent Baseline Optimistic H is to ry Fo re c as t Sources: NAMCS,NHAMCS, Milken Institute

25 Illicit Drug Use Projections United States, Percent Baseline Optimistic H is to ry Fo re c as t Sources: BRFSS, Milken Institute

26 Population Projections Aged 65 and Over, 2023 Percent Male Female H is to ry 1998 Fo re c as t Source: U.S. Census Bureau

27 Breast Cancer: Incidence Projections United States, Per 100,000 Female Population Baseline Optimistic Sources: MEPS, Milken Institute

28 Breast Cancer: PRC Projections United States, Millions Baseline Optimistic Sources: MEPS, Milken Institute

29 Breast Cancer : PRC Rate Projections United States, Per 100,000 Female Population Baseline Optimistic Sources: MEPS, Milken Institute

30 Breast Cancer Population Reporting Condition per Capita, 2003 Sources: MEPS, Milken Institute Lowest ThirdTier SecondTier Highest

31 Colon Cancer Population Reporting Condition per Capita, 2003 Sources: MEPS, Milken Institute Lowest Third Tier Second Tier Highest

32 Lung Cancer Population Reporting Condition per Capita, 2003 Sources: MEPS, Milken Institute Lowest Third Tier Second Tier Highest

33 Prostate Cancer Population Reporting Condition per Capita, 2003 Sources: MEPS, Milken Institute Lowest Third Tier Second Tier Highest

34 Other Cancers Population Reporting Condition per Capita, 2003 Lowest Third Tier Second Tier Highest Sources: MEPS, Milken Institute

35 Pulmonary Conditions Population Reporting Condition per Capita, 2003 Lowest ThirdTier SecondTier Highest Sources: MEPS, Milken Institute

36 Diabetes Population Reporting Condition per Capita, 2003 Lowest ThirdTier SecondTier Highest Sources: MEPS, Milken Institute

37 Hypertension Population Reporting Condition per Capita, 2003 Lowest ThirdTier SecondTier Highest Sources: MEPS, Milken Institute

38 Heart Disease Population Reporting Condition per Capita, 2003 Lowest ThirdTier SecondTier Highest Sources: MEPS, Milken Institute

39 Stroke Population Reporting Condition per Capita, 2003 Sources: MEPS, Milken Institute Lowest Third Tier Second Tier Highest

40 Mental Disorders Population Reporting Condition per Capita, 2003 Sources: MEPS, Milken Institute Lowest ThirdTier SecondTier Highest

41 State Chronic Disease Index 2006 Most Healthy Second Tier Third Tier Least Healthy

42 Breast Cancer: Expenditure per PRC Projections United States, US$ Thousands Baseline Optimistic Sources: MEPS, Global Insight, Milken Institute

43 Breast Cancer: Total Expenditure Projections United States, US$ Billions Baseline Optimistic Sources: MEPS, Milken Institute

44 Breast Cancer: Avoidable Costs United States, US$ Billions Source: Milken Institute

45 2023 Disease- Specific Projections Changes Relative to Baseline Chronic Disease Absolute (Thousands) PRC Percent Total Expenditure Absolute (US$ Billions) Percent Breast Cancer % % Lung Cancer % % Colon Cancer % % Prostate Cancer % % Other Cancers -2, % % Diabetes -2, % % Heart Disease -9, % % Pulmonary Conditions -9, % % Hypertension -9, % % Stroke % % Mental Disorder -5, % % Total -40, % %

46 Projections of Indirect Impact (Based on GDP) US$ Billions, 2023 Difference Disease Baseline Optimistic Absolute Percent Cancer % Breast cancer % Lung cancer % Colon cancer % Prostate cancer % Other cancer % Diabetes % Heart disease % Asthma % Hypertension % Stroke % Emotional Disturbances % Total 3,363 2, %

47 Company Wellness Plans Offering Incentives to Employees Johnson & Johnson and Pitney Bowes wellness program saved $225 per employee in medical costs annually IBM pays employee s $300 a year to participate in wellness program and offers $150 to nonsmokers for not smoking At Citigroup, for every $1 spent on wellness program, company saves $4.70 in health care savings FPL Group in Florida, offer bonuses toward health-reimbursement account for participating in wellness programs

48 Economic Burden of Chronic Disease Introduction Chronic diseases lead to lower quality of life for individuals, families, society and the economy Costs associated with chronic diseases is likely to escalate in the future Project attempts to quantify effects of prevention, early detection and innovations in the treatment of chronic diseases on: - Potential health-care cost system reductions - Improved economic growth

49 Project Overview Economic Burden of Chronic Disease (U.S. and States) Avoidable Costs Forgone Economic Growth Stage 1 Stage 2 Stage 1 Stage 2 A B Estimating Direct Costs By Chronic Disease (Related to Treatment ) Projection of Direct Costs Under Alternative Scenarios Estimating Indirect Impacts By Chronic Disease (Due to Lost Work and Productivity) Projection of Indirect Impacts Under Alternative Scenarios Intergenerational Economic Impacts Under Alternative Scenarios

50 Avoidable Costs of Chronic Disease Diseases Estimate costs of treating the following chronic diseases: Diabetes Cancer: colon, breast, lung, prostate and all other Heart disease Hypertension Stroke Pulmonary Conditions (principally Asthma) Mental Disorder (including Depression)

51 Direct Costs of Chronic Disease Stage 1: Methodology Medical Expenditure Panel Survey (MEPS) A large-scale survey of families, individuals and their medical providers across the United States. Advantages Accounts for civilian non-institutionalized U.S. population Includes 30,000 individuals every year Includes demographic characteristics, health conditions and status, use of medical services etc. Based on groups of three digit ICD-9 codes into 260 mutually exclusive categories Useful national and 4 census region level summary data on expenditure and number of patients Shortcomings: Disaggregated disease codes not available in summary tables Not primarily designed to facilitate smaller geographic level estimation Only 4 census region identifiers are available

52 Comparison of Direct Cost and Indirect Impact US$ Billions, 2003 Disease Direct Cost Indirect Impact Total Cancer Asthma/COPD Diabetes Hypertension Heart Disease Stroke Emotional/Mental Dis Total , ,324.2 *Indirect Impact Based on Nominal GDP

53 Indirect Impacts Due to Lost Work and Productivity Stage 1: Overview Better health of employees imply less lost work days, higher productivity, and hence greater output We attempt to calculate the impact of lost work and productivity by chronic disease

54 Indirect Impacts Due to Lost Work and Productivity Stage 1: Methodology Cont d Individual Caregivers Lost Work Days (NHIS) Presenteeism (Cornell Study) Lost Work Days (AARP/Metlife) Presenteeism (AACE)

55 Projection of Direct Costs Under Alternative Scenarios Stage 2: Overview Develop alternative assumptions on the future path of chronic-disease incidence, prevalence and number of patients based on best practices in prevention, early detection and new innovations in disease treatment and management Develop baseline and optimistic scenarios of chronic disease treatment costs based on assumptions above Direct Avoidable Cost = Difference in expenditure between baseline and optimistic scenarios

56 Age-Specific Incidence Rates Per 100,000 Population, 2003 Cancer Aged 0 to 49 Aged 50 to 54 Aged 55 to 64 Aged 65 to 74 Aged 75 and over Breast Cancer Colon Cancer Lung Cancer Prostate Cancer Other Cancers

57 Age-Specific Prevalence Rates Percent of Population, 2003 Chronic Disease Aged 25 to 44 Aged 45 to 49 Aged 50 to 64 Aged 65 to 74 Aged 75 and over Diabetes Heart Disease Hypertension Pulmonary Conditions Stroke

58 Projection of Direct Costs Under Alternative Scenarios Stage 2: Assumptions based on Behavioral Risk Factors Risk Factors Sm oking Alcohol Overweight (but not obese) Chronic Conditions Impacted Unit of Measurement (baseline) 2023 (optimistic) cancer of lung & colon, asthma, hea rt dis., stroke (as % of total population) 27.7% 22.2% 19.0% 15.4% cancer of breast & colon, mental disorder,heart dis., hypert., stroke (as % of total population) 8.9% 5.8% 5.8% 4.2% cancer of breast, colon & prostate, diabetes, heart dis., hypert., stroke (as % of total population) 28.6% 36.6% 43.6% 32.2% cancer of breast, colon & prostate, diabetes, heart dis., Obesity hypert., stroke (as % of total population) 10.2% 22.8% 28.7% 19.4% Physica l Activity all (as % of total population) 74.8% 75.0% 77.9% 83.3% Diet High in Re d Me a t cancer of colon & prostate (pounds per capita) Diets High in Cholesterol heart disease, hypert., stroke (as % of total patients) 7.9% 33.6% 42.2% 31.5% Sodium heart disease, hypert., stroke (sodium per capita per day) Estrogen breast cancer, hypertension (as % of patients) % 0.81% 0.62% Air Quality Asthma Index Illicit Drug Use Mental Disorder (as % of total population) 0.25% 0.51% 0.64% 0.57%

59 Heart Disease Projections 2003 vs PRC ( Thousands ) Total Expenditure ( US$ Billions ) Year Demographics Only Baseline Optimistic Baseline Optimistic ,145 19,145 19, ,939 27,016 17, Percent Change % 41.1% -7.7% 187.3% 70.1%

60 Heart Disease Projections Avoidable Costs, US$ Billions

61 2023 Disease Differences Due to Obesity Changes Relative to Baseline Chronic Disease PRC* Absolute (Thousands) Total Expenditure Absolute (US$ Billions) Percent Breast Cancer % Colon Cancer % Prostate Cancer % Other Cancers -1, % Diabetes -2, % Heart Disease -4, % Hypertension -5, % Stroke % Total -14, % *PRC = Population Reporting Condition

62 2023 Disease Differences Due to Smoking Changes Relative to Baseline Chronic Disease PRC Absolute (Thousands) Total Expenditure Absolute (US$ Billions) Percent Lung Cancer % Colon Cancer % Other Cancers -2, % Heart Disease -1, % Pulmonary Conditions -7, % Stroke % Total -11, %

63 Population Aged 65 and Over Percent of Population, 2023 Lowest Third Tier Second Tier Highest

64 Projection of Indirect Impacts Under Baseline and Optimistic Scenarios Stage 2A: Overview Develop alternative assumptions on the future path of lost work days and productivity based on projections of direct costs Develop baseline and optimistic scenarios of indirect impacts by chronic disease Indirect Foregone Impacts = Difference in impact between baseline and optimistic scenarios

65 Project Overview Economic Burden of Chronic Disease (U.S. and States) Avoidable Costs Forgone Economic Growth Stage 1 Stage 2 Stage 1 Stage 2 A B Estimating Direct Costs By Chronic Disease (Related to Treatment ) Projection of Direct Costs Under Alternative Scenarios Estimating Indirect Impacts By Chronic Disease (Due to Lost Work and Productivity) Projection of Indirect Impacts Under Alternative Scenarios Intergenerational Economic Impacts Under Alternative Scenarios

66 Intergenerational Economic Impacts Stage 2B: Overview Attempt to quantify health (chronic disease) impact on human and physical capital formation the restrictions imposed on intergenerational economic growth Determinants of economic growth and model specification Historically, only few have been found to be significant in explaining growth Human capital s role Dynamic economic growth depends upon the stock of human capital investment in education, continued training and greater levels of health Good health increases the rate of return to Investments in education Expands the research production possibilities frontier and improves the nation s competitiveness in the long-term The higher the income earner s human capital, the greater the probability that they will invest in their children s and grandchildren's education

67 Production Function Results Dependent Variable: Log(Real GDP by State) Variables Log (Life Expectancy at 65) Log (Bachelor's Degree) Log (Unadjusted Labor Force) Log (Capital Stock) Log (Young Dependent Per Capita) *significant at the 5% level **significant at the 1% level Coefficient 0.258* (2.05) 0.506** (19.31) ** (26.17) 0.196** (14.84) ** (-7.09)

68 Life Expectancy at Age 65 U.S. Baseline and Optimistic Projections Years Remaining History Forecast Baseline Optimistic

69 Bachelor s Degrees and Above U.S. Baseline and Optimistic Projections Percent of Population History Forecast Baseline Optimistic

70 Economic Burden of Chronic Disease Preliminary Conclusions Healthcare Expenditure Accounts by Disease Direct Costs Large but...indirect Costs on Business Huge Aging Population Drives Chronic Disease Higher Anti-obesity- Healthy Body Weight Initiative Incentives for Preventive Action Bring More Uninsured in the System Good Health Is an Investment in Economic Growth Early Intervention and Medical Innovations Improve Quality and Longevity of Life

71 Cigarette Taxes on the Rise Average Retail Price Per Pack US$ per Pack Federal Taxes State Taxes Net Price Sources: Tax Burden on Tobacco, Campaign for Tobacco-Free Kids

72 The Tensions Are Real The Economy Health Health Care

73 Determinants of Health Access to Care (10%) Genetics (20%) Socio- Economic Factors Environment (20%) Healthy Behaviors (50%) Tobacco use Inactivity Poor nutrition Sleep Alcohol & drug use

74 Mismatch: Health Determinants and Health Expenditures Influence Access to Care 10% National Health Expenditures $2.0 Trillion Genetics 20% Environment 20% Access to Care 88% Healthy Behaviors 50% Other Healthy Behaviors 8 % 4 % Source: CDC, UCSF, IFTF

75 Rising Costs Crowd Out Other Priorities Health Care Spending Has Crowded Out Other Priorities Net Change in Real Spending: Massachusetts Budget FY01 - FY07 Health Care State Budget in Total Health Care % 0 Local Aid - Schools Public Health Public Higher Education Public Health Source: MA Taxpayers Foundation, MA Budget and Policy Center, and NEHI estimates

76 The Land of the Free and Not So Free

77 Behavior Change Source: Gary Brookins, Richmond Times-Dispatch

78 Lack of Evidence-based Care Percent of Recommended Care Received 64.7% Hypertension 63.9% Congestive Heart Failure 53.9% Colorectal cancer 53.5% Asthma 45.4% Diabetes 39.0% Pneumonia 22.8% Hip Fracture 45% Patients do not receive care in accordance with best practices 55% Patients receive care in accordance with best practices Source: RAND Nearly 50% of care is not based on best practices Source: Elizabeth McGlynn et al, RAND, 2003

79 A New Form of Prevention Source: New Yorker

80 Truly Heart Stopping Obesity is the second leading cause of preventable death in the U.S Preventable Burden: 300,000 deaths Costs: $ billion/yr No Data <10% 10% 14% 15% 19% 20% 24% 25% (*BMI 30, or about 30 lbs overweight for 5 4 person) Source: CDC, BRFSS

81 The majority of health costs in America are driven by illnesses that have a significant preventable component Reference: Fries JF, Koop CE, Soklov J, Beadle CE, and Wright D. Beyond Health Promotion: Reducing Need and Demand for Medical Care, Health Affairs 1998;17(2):70-84.

82 Significant geographic variability in treatment choices challenges the notion of standard of care. Rates in spine surgery for back pain, for example, vary by a factor of almost six, from 1.6 per 1,000 patients to 9.4. Reference: A Report by the Dartmouth Atlas of Health Care. CMS FDA Collaborative Patients presented with the pros and cons of different treatment options often choose the less expensive, less invasive option with the best outcomes.

83 A Health Risk Assessment is a key component of reliable evaluation of status and progress

84 Incentives Help Drive Program Participation 100% HRA Completion 80% 60% 40% 20% 0% Reference: Internal WebMD Data Point of diminishing returns N = 23+ Employers $0 $100 $200 $300 $400 $500 Size of Cash Reward

85 Nearly 40% of participants in lifestyle modification programs reduce their key risk factors Reference: Internal WebMD Data