Chronic Conditions in the U. S Chronic Conditions in the U.S. Implications for Service Delivery and Financing Jane Horvath, M.H.S.A. Deputy Director Partnership for Solutions A Project of Johns Hopkins University and The Robert Wood Johnson Foundation “Jane Intro Slide”

Chronic Conditions in the U.S. Chronic conditions are expected to last a year or more, limit what one can do and may require ongoing care. Chronic conditions are a significant and growing challenge. People with chronic conditions have significantly higher utilization and health care costs. Coordination of services for people with chronic conditions is lacking. There are opportunities for change. “chronic”

The Number of People with Chronic Conditions is Rapidly Increasing “#ofchronic “#chronic”Today, 125 million Americans have one or more chronic conditions (45% of the population). Almost half the population will have a chronic condition by 2030. “#of chronic” Between 2000 and 2030, the number of Americans with chronic conditions will increase by 37 percent, an increase of 46 million people. The probability of having a chronic condition increases with age. Between 2000 and 2030, the proportion of Americans age 50 and older will increase from 28 percent to 36 percent Source: Wu, Shin-Yi and Green, Anthony. Projection of Chronic Illness Prevalence and Cost Inflation. RAND Corporation, October 2000.

Almost Half of People with a Chronic Condition have Multiple Chronic Conditions In 2000, 21 percent of all Americans had two or more chronic conditions. In 2030, it is estimated that 26 percent of all Americans will have multiple chronic conditions. The Prevalence of multiple chronic conditions increases with age: 5 percent of children have more than one condition 35 percent of people ages 45- 64 have more than one condition 62 percent of people ages 65+ have more than one condition Source: Wu, Shin-Yi and Green, Anthony, Projection of Chronic Illness Prevalence and Cost Inflation. RAND Corporation, October 2000.

1/4 of Individuals with Chronic Illness also have Activity Limitations Both Activity Limitation Only Chronic Illness Only 90 million 30 Million 7 Million n = 127 Million “onequarter” Eighty-one percent of those with activity limitations also have a chronic condition. Although there are 37 million people with activity limitations living in the community, about 2.7 million adults are severely impaired and need assistance with three or more activities of daily living -- eating, dressing, getting in or out of a bed or a chair, or using the toilet (Feder, Komisar, and Niefeld, “Long-Term Care In The United States: An Overview,” Health Affairs 19:3, May 2000). Source: Medical Expenditure Panel Survey, 1998.

Most People with Chronic Conditions have Private Health Insurance “Private health” Almost sixty-six million Americans with a chronic condition have private health insurance. Eleven million non-institionalized Americans with chronic condition have only Medicaid coverage. Eight and a half million Americans with one or more chronic conditions are uninsured. Population of People with Chronic Conditions in 1998 n =120 million . Source: Medical Expenditure Panel Survey, 1998.

Source: Medical Expenditure Panel Survey, 1998. Health Care Spending for People with Chronic Conditions Accounts for 78 % of All Health Care Spending “78%” Seventy-eight percent of health care spending is attributed to the 44 percent of the noninstitutionalized population that has one or more chronic conditions. Sixty-eight of private health insurance spending is attributed to the 40 percent of privately insured people who have chronic conditions. Three-fifths of all health care spending for the uninsured is for care received by the 27 percent of uninsured with chronic conditions. Seventy-seven percent of Medicaid spending is for the almost 40 percent of noninstitutionalized beneficiaries with chronic conditions. Ninety-seven percent of spending for the non-institutional dually eligible population is for the 87 percent of this population with chronic conditions. Source: Medical Expenditure Panel Survey, 1998.

Health Care Spending Increases with the Number of Chronic Conditions “increases” Average per capita spending on people with one or more chronic conditions is more than four times greater than spending on people without any chronic conditions. ($800 for people with no conditions compared to $3,700 for people with one or more conditions.) Compared to individuals with no chronic conditions: Spending is almost two and a half times greater for someone with one chronic condition. Spending is seven times greater for someone with three chronic conditions. Spending is more than 14 times greater for someone with five or more chronic conditions. Spending on behalf of people with four or more chronic conditions represents 26 percent of all health care spending, yet this group is only 5 percent of the population. Source: Medical Expenditure Panel Survey, 1998.

People with Chronic Conditions are the Heaviest Users of Medical Care Source: Medical Expenditure Panel Survey, 1998.

People with Multiple Chronic Conditions are Much More Likely to be Hospitalized “Hospitalized” People with five or more chronic conditions are eight times more likely to be hospitalized during the year than people with no chronic conditions. Rates of hospitalizations are generally two to three times higher for people with activity limitations than for those without limitations. People with five or more chronic conditions have four times as many physician visits and almost 16 times as many home health visits as people with one chronic condition. People with chronic conditions fill an average of 48 prescriptions compared to 7 for people with one condition. Among those who have activity limitations, the person with 5 or more conditions fills an average of 54 prescriptions compared to 10 prescriptions for the person with one condition. Source: Medical Expenditure Panel Survey, 1998.

More than Half of People with Serious Chronic Conditions Have Three or More Different Physicians “Physicians” Eighty-one percent of people with serious chronic conditions see two or more different physicians. The average Medicare beneficiary sees an average of six unique physicians and those with 5 or more chronic conditions see 14 different physicians. Source: Gallup Serious Chronic Illness Survey 2002.

People with Chronic Conditions Report Getting Conflicting Advice “conflicting” Many individuals with chronic conditions are faced with a dilemma–which provider to believe. An estimated 16 million adults go to the drug store every year only to be told of potential drug interactions. Half of all Americans report that they must give the same information to multiple providers. Source: Chronic Illness and Caregiving, a survey conducted by Harris Interactive, Inc., 2000.

Physicians Believe that Poor Care Coordination Produces Bad Outcomes “bad outcomes” Inadequate care coordination can be costly for patients and other payers when it leads to unnecessary nursing home placements, inappropriate hospitalizations, or adverse drug interactions. Specialists report having greater difficulty coordinating care than general practitioners. Good care coordination should be considered a necessary part of high-quality care. Source: National Public Engagement Campaign on Chronic Illness–Physician Survey, conducted by Mathematica Policy Research, Inc., 2001.

Poor Care Coordination Leads to Unnecessary Hospitalizations Ambulatory care sensitive conditions (ACSCs) are conditions for which timely and effective outpatient primary care may help to reduce the risk of hospitalization. Inappropriate hospitalizations increase as the number of chronic conditions increase. People with multiple chronic conditions use medical goods and services at higher rates than others and they often receive duplicate testing, conflicting treatment advice, and prescriptions that are contra-indicated. These factors may play a role in the correlation between increasing numbers of chronic conditions and increasing numbers of inappropriate hospitalizations. Source: Medicare Standard Analytic File, 1999.

How do we Improve the System? Benefits Medical necessity determinations and policies Disease Management Payments Clinical care case management fee Pharmacy coordinator Quality Care Coordination as a quality measure for health systems “improve”