Preventive Care not a Free Ride

October 13th, 2009 | Sources: Health Affairs, Washington Post

Preventive services for patients with Type II diabetes do reduce future health-care costs, but even in the long term, the initial expenses are not completely recovered according to a study published in Health Affairs earlier this month. 

To reach these conclusions, Michael O’Grady and colleagues compiled data from several clinical trials that used an aggressive but doable program to manage all phases of the disease.

thecolorofmoneyThey found that federally-insured patients enrolled in such a program would cost over $1,000 per person per year, and that even after 25 years, only ¾ of those costs would be returned via reduced spending on dialysis, amputations and coronary heart disease.

The only group in whom preventive services actually reduced long-term costs were those in their mid-20s at study onset.

“There’s no free lunch here,” concluded O’Grady in an interview with the Washington Post.

President Obama, House Speaker Nancy Pelosi and others claim that health reform will save money, in part by preventing the costs of future diseases by increasing access to preventive services.

Pelosi and Senator Tom Harkin frequently criticize the Congressional Budget Office for adopting a long-enough time horizon in estimating the cost impact of such programs.

The new study supports their position. Most savings accrued well after the 10-year horizon typically used by CBO. The study authors propose a 25-year time horizon for calculating the impact of such programs.

CBO Director Douglas Elmendorf seemed open to the suggestion, indicating the study was “exactly the sort of research that we use in building our cost estimates. We will consider these findings in future estimates we do in this area.”

Earlier this month, the CBO concluded that the costs of widespread cancer screening and cholesterol management programs were going to far outweigh any savings, even in the long term.


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