Prevention Does Not Necessarily Provide Expected Cost Savings

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Senate Democrats and Obama administration officials hoping that preventive care would create federal savings have been disappointed to learn that it does not create expected cost savings.

CQ Politics reports: "The problem, as lawmakers are discovering to their frustration, is that the logic is wrong. Preventive care - at least the sort delivered by doctors - doesn't save money, experts say. It costs money....The reason preventive care doesn't save money is simple. To prevent a single stroke, for example, doctors must treat thousands of people who have high blood pressure and therefore are at risk of stroke. The same goes for use of cholesterol-lowering statin drugs, which can prevent heart attacks. ... All of those prescription drugs and office visits add up to big money. But many of the patients never would suffer a stroke or heart attack even without treatment. And some will suffer such attacks despite it. In the end, the expense of the preventive care for thousands of people outweighs the expense of treating the few that would have suffered strokes or heart attacks without treatment" (6/29).

Kaiser Health News/Washington Post examine ways to prevent the costly problems of hospital readmissions. KHN reports: "Experts don't agree on how many readmissions are avoidable. Dozens of promising initiatives designed to cut down on them are underway. But many experts say sweeping changes are needed in how health care is delivered and how hospitals and doctors are paid -- sensitive issues that confront Congress and the medical industry in the debate on overhauling the health system. President Obama and health reformers in Congress are looking at many ways to reward quality and emphasize prevention and coordination.... One idea is to bundle the payments to hospitals, doctors and perhaps nursing homes or rehabilitation centers, to cover both the hospitalization and those first critical weeks after discharge. Another proposal is to have Medicare penalize hospitals with high readmission rates for eight common chronic diseases. Members of both parties have been looking at ways of paying primary care doctors more to help patients manage their chronic diseases and avoid trips to the hospital every few weeks or months."

KHN reports: "Both doctors groups and the American Hospital Association have agreed that it's time to address readmissions. The association, however, prefers to start with pilot programs to test new payment systems rather than implementing an across-the-board new approach. The AHA also says hospitals should not be held responsible for problems that patients encounter when they're outside the hospitals' control. Readmission costs are staggering. One of five Medicare hospital patients returns to the hospital within 30 days -- at a cost to Medicare of $12 billion to $15 billion a year -- and by 90 days the rate rises to one of three, according to an analysis of 2007 data by Stephen Jencks. Within a year, two out of three are back in the hospital -- or dead" (Kenen, 6/30).

This information was reprinted from kaiserhealthnews.org with kind permission from the Henry J. Kaiser Family Foundation. You can view the entire Kaiser Daily Health Policy Report, search the archives and sign up for email delivery at kaiserhealthnews.org.

© Henry J. Kaiser Family Foundation. All rights reserved.