A few diseases fuel healthcare’s rising cost

As insurers, employers and average Americans grapple with skyrocketing healthcare bills, a new study has found that a small number of illnesses -- many of them preventable -- account for most of the spending increase over the last two decades.

In the first comprehensive examination of which illnesses are driving an unprecedented rise in medical expenditures, Emory University health economist Kenneth E. Thorpe tracked 370 conditions and found that 15 accounted for 56% of the $200-billion rise in health spending between 1987 and 2000.

Five conditions accounted for one-third of the increase, with heart disease at the top of the list, followed by pulmonary conditions, mental disorders, cancer and hypertension.

By documenting the most costly conditions, Thorpe’s findings, published in the Aug. 25 journal Health Affairs, offer the beginnings of a road map for controlling health costs. At the same time, they suggest that in some cases, the increased spending has resulted not only in better health but also in long-term savings. “Higher spending on treating heart attacks, low-birth weight babies, cataracts and depression has benefits that outweigh the increased costs,” he wrote. “Inasmuch as treatments for these conditions are cost-effective, their more widespread use is likely to represent an appropriate if costly expenditure by society.”

Americans spent about $1.6 trillion on healthcare last year, or about 15% of the gross domestic product, compared with 11% of GDP 15 years ago.

In the last three years, health insurance costs have increased an average of 12.5% annually, and that increase is the most commonly cited reason for why nearly 44 million people do not have insurance.

Thorpe found that medical spending had risen for three main reasons: More people are suffering from disorders such as asthma and diabetes; some conditions, such as heart disease, have become more expensive to treat; and the number of people diagnosed with illnesses such as mental disorders has climbed.

“We’ve known healthcare spending is concentrated on certain individuals, but I don’t think we knew how concentrated it is by medical condition,” said Len Nichols, vice president of the Center for Studying Health System Change. “This points us in the direction of investigating value for dollars.”

Although Americans spend more per capita on healthcare than citizens of any other industrialized nation, numerous studies have suggested the investments have not resulted in a healthier population.

Thorpe said emphasizing prevention and following “best practices” guidelines could slow the growth rate in health spending and improve overall health.