An article published yesterday by Health Affairs finds that the causes of Medicare spending growth have changed dramatically over the past two decades.  Twenty years ago, most of the increases were due to inpatient hospital services, especially for heart disease, but recent annual increases are the result of outpatient treatment of chronic conditions such as diabetes, arthritis, hypertension, and kidney disease, report researchers from the Rollins School of Public Health at Emory University in Atlanta.  

Lead author Kenneth Thorpe and colleagues analyzed data about disease prevalence and about level of and change in spending on the ten most expensive conditions in the Medicare population from 1987, 1997, and 2006.  Among the key findings: heart disease ranked first in terms of share of growth from 1987 to 1997.  However, from 1997 to 2006, heart disease fell to tenth, while other medical conditions – diabetes the most prevalent – accounted for a significant portion of the rise.  Furthermore, the authors postulate that increased spending on diabetes and some other conditions results from rising incidence of these diseases, not increased screening and diagnoses.  

Conclude the authors:  “The changing mix of medical conditions driving the rise in Medicare spending had consequential effects.  More than half of the beneficiaries are treated for five or more chronic conditions each year.  System fragmentation means that chronically ill patients receive episodic care from multiple providers who rarely coordinate the care they deliver, and  chronic disease management programs are notably absent in traditional fee-for-service Medicare.  As Congress, the administration, providers, insurers. and consumers debate reshaping the U.S. health system, they must address these changed health needs through evidence-based preventive care.”

The data for the study were drawn from the 1987 National Medical Expenditure Survey (NMES), and the 1997 and 2006 Medical Expenditure Panel Survey (MEPS).