Healthcare Analytics, Population Health Management, Healthcare Big Data

Population Health News

Top 5% of chronic disease patients spend 29.7% of care costs

- It may come as no surprise that complex chronic disease management is an expensive proposition for the healthcare industry, but new data from AHRQ finds that the top 5% of patients with four or more chronic diseases accounted for nearly 30% of complex chronic disease costs with an annual mean of $78,198.  The top one percent of patients overall scooped up 22.7% of healthcare spending, with each patient costing close to $100,000 per year.  As the industry seeks to contain costs and implement population health management programs that forestall the development of expensive chronic diseases, the data reveals just how far healthcare providers have to go in order to reach their goals.

revenue cycle management and healthcare costs

The Agency for Healthcare Research and Quality (AHRQ) examined patient data from the 2012 Household Component of the Medical Expenditure Panel Survey to compile statistics on the most expensive patient cohorts.   Older patients with multiple chronic conditions, patients of lower socio-economic status, and non-white patients were among the top spenders and may be the best targets for preventative care, care coordination programs, and patient engagement plans.

Some of the highlights from the report include:

• Uninsured patients under the age of 65 had substantially lower expenditures than their insured counterparts, which may indicate that patients without health insurance coverage tend to avoid services that would cost them out-of-pocket expenses.  The top 5% of uninsured patients had an annual mean expenditure of just $14,565.

• The top 50% of the population accounted for 97.3% of overall health care expenditures. The lower 50% contributed just 2.7% of total spending.

• The top 5% of patients 65 and older accounted for 34.2 percent of the medical expenditures experienced by Medicare-aged senior citizens, with an annual mean of $63,798.  Elderly patients showed the greatest distribution of costs, meaning that every patient in the group cost more on average than patients in other age cohorts.

• The top 5% of non-Hispanic whites and other races made up 45.8% of spending in their group, while the highest 5% of black patients accounted for 55.2% of spending.  The highest 5% of Hispanic patients spent 62.4% of annual spending, indicating that the sickest minority patients are in need of more expensive and/or intensive services than their sickest white counterparts.

• The neediest male patients were responsible for 10% more spending than the neediest female patients across age and racial groups.

• The top 5% of patients with lower socioeconomic status were responsible for more healthcare costs than patients of higher socioeconomic groups, indicating a need to target preventative care and primary care services to lower income populations.

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