Healthcare Analytics, Population Health Management, Healthcare Big Data

Population Health News

Preventable Diabetes Care Costs Total $16 Billion Per Year

Researchers used claims data analytics to understand the impact of preventable conditions caused by gaps in care delivery for diabetes.

By Jacqueline Belliveau

- A recent study by the Health Care Incentives Improvement Institute (HCI3) revealed that the healthcare system spends an estimated $16 billion each year on preventable conditions and services for the chronic disease management of diabetes in the US.

$16 billion per year spent on avoidable diabetes care

The study showed that payers and providers can reduce the national average cost for diabetes and improve care quality for diabetics by closing the gaps in care delivery.

According to the American Diabetes Association (ADA), the total cost of diagnosed diabetes in 2012 was an estimated $245 billion.

The report stated that potentially avoidable conditions and services accounted for a large portion of the total healthcare spending on diabetes.

The top avoidable conditions and services were control of diabetes, fluid/electrolyte/acid-based issues, acute renal failure, and skin infections or cellulitis. Potentially avoidable services included lab tests, CTs of the head, cardiac stress tests, and ultrasound of extracranial arteries.

The annual cost of caring for patients who develop these avoidable conditions was $10.3 billion for commercially insured patients and $6.5 billion for those with Medicaid, accounting for 22.8 percent of total costs for commercial insurance patients and 28 percent of Medicaid spending. Potentially unnecessary services related to diabetes care cost $1.3 billion and $298 million respectively.

Researchers used two administrative claims datasets consisting of information from commercial insurers and Medicaid from 2012 to 2014. They used a big data analytics system to isolate preventative costs from routine care spending.

The study stated that 63.7 percent of patients with commercial insurance and 80 percent with Medicaid experienced a preventable condition in the course of a year, and approximately 79.1 percent of commercially insured and 85.8 percent of Medicaid patients received at least one potentially avoidable service during a twelve-month period.

Healthcare providers could reduce the prevalence of avoidable complications and improve the quality of care for the diabetes population by closing the gaps in care delivery, researchers stated.

For example, 73 percent of the commercial population and 56 percent of the Medicaid population did not receive an annual eye exam, while 60 percent of commercial and 16 percent of Medicaid-covered patients did not receive proper lipid level monitoring. The majority of diabetic patients also went to fewer physicians visits than recommended.

The study indicated that inadequate chronic disease management tools for diabetics led to increased healthcare spending.

“When health care leaders can zero in on where unnecessary costs are coming from, and identify which are caused by potentially avoidable complications, they're in a great position to start making changes that are going to be better for patients' physical and financial health,” said François de Brantes, coauthor of the study and executive director of HCI3, in a press release.

“Without the spotlight on problem areas, there's no progress. Data insights make it possible to alter payment models so they reward excellence, or to modify some clinical practices.”

Other organizations have recently created chronic disease management programs for diabetes that aim to improve patient outcomes, encourage patient-centered care, and reduce healthcare costs for payers and patients.

Many of the programs focus on supporting lifestyle changes, such as weight control and increased physical activity, while others provide practices with proper training and equipment for treating diabetics.

Additionally, CMS recently announced that it will expand the National Diabetes Prevention Program, a chronic disease management initiative, to include Medicare beneficiaries.

The HCI3 study and chronic disease management programs support the theory that reduced healthcare spending will happen when healthcare providers have ways to prevent complications and the slow the development of diabetes.


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