Addressing Out-of-Pocket Costs Key to Health Improvement & Cost Savings
By Kenneth E. Thorpe
More than 190 million Americans suffer from chronic diseases. For them, healthcare reform isn't a political football -- it's a matter of life and death.
Unfortunately, both parties keep pushing reforms that won't improve patients' lives. One side is focused on making insurance coverage skinnier and cheaper; the other on having the government takeover large segments of the healthcare system, setting prices, and sacrificing innovation and consumer choice.
Both these approaches would make it harder for patients to get the care they need and burden our healthcare system in the long run. To cut costs and help patients save billions, politicians ought to focus on making preventing and managing chronic diseases more accessible by addressing out-of-pocket costs.
Chronic diseases account for 90 percent of all U.S. healthcare spending. Today, six in 10 Americans live with at least one chronic condition.
People with chronic conditions face unreasonable out-of-pocket costs. On average, individuals with two or more chronic diseases spend five times more out-of-pocket than patients without any chronic conditions. People with three or more conditions pay 10 times more.
These out-of-pocket burdens have grown as insurance has steadily shifted more costs onto patients. Because of such trends, average out-of-pocket spending has grown 58 percent over the past decade.
Consider the growth of high-deductible health plans, which typically require patients to pay thousands of dollars out-of-pocket before coverage begins.
This year, 30 percent of workers have a high deductible health plan compared to just 4 percent in 2006. For people living with chronic conditions, surging out-of-pocket costs often mean delaying or forgoing care altogether.
A recent study showed that even women receiving a breast cancer diagnosis delayed treatment at every step -- screening, testing, surgery, radiation, and therapy -- when insured under a high deductible health plan.
This harms patients and adds to overall costs. Medication non-adherence alone causes approximately 125,000 deaths and adds nearly $300 billion to America's healthcare bill annually. In fact, we spend more failing to optimize adherence and medication benefits than we do on drugs themselves. Reducing out-of-pocket costs would improve adherence -- thus keeping people healthy, saving money and lives.
As Congress considers legislation to improve our healthcare system, it is shortsighted to focus on just one silo of care in our continuum.
Instead, policymakers should focus on ways to lower out-of-pocket costs for people living with chronic conditions. Improving access to high quality chronic disease care could save our nation $6.3 trillion in spending.
Chronic diseases are the number one cause of death, disability and rising healthcare spending in the United States. The only way to save lives and reduce costs is to invest in better treatment -- and address out-of-pocket costs so treatment is accessible to the people who need it most.
Kenneth E. Thorpe is a professor of health policy at Emory University and chairman of the Partnership to Fight Chronic Disease.
