Medicare Compliance & Reimbursement

New study pegs obesity as major culprit as well.

Beneficiaries with three or more conditions accounted for more than 92 percent of Medicare spending in 2002, researchers discovered. More aggressive treatment and preventive services for ailments such as obesity and metabolic syndrome have triggered escalating spending on Medicare benes. But researchers are wondering whether these more aggressive treatments will only snowball into additional spending in years to come.

More than half of all Medicare benes are receiving treatment for five or more conditions, up from 31 percent in 1987. These benes alone caused 76 percent of all Medicare spending in 2002, a new study by economists David Howard and Kenneth Thorpe finds. The study appeared on the Health Affairs Web site.

Through the two researcher's comparison of data from the 1987 National Medical Expenditure Survey to the 2002 Medical Expenditure Panel Survey, they discovered that obesity was one driving force behind increases in Medicare spending during the past 15 years. While obesity rates among Medicare enrollees doubled from 1987 to 2002, Medicare spending on obese enrollees nearly tripled (9.4 percent of Medicare spending in 1987 to 25 percent in 2002).

These statistics indicate a need for better interventions for obesity and chronic disease among the elderly, Thorpe said in an Aug. 22 statement. "We need interventions that go beyond what current Medicare policy does, to reach the 'near elderly' and work with people before they approach the age of Medicare eligibility to fight obesity and chronic disease. The policy debate must shift away from one that focuses on health plan competition as the way to control costs," he maintains.

More Preventive Care Also Behind Spending Increases

But spending on obese benes isn't the only culprit behind skyrocketing Medicare expenditures, Thorpe and Howard note. Physicians are treating both obese and non-obese benes with multiple conditions more thoroughly, and an increasing push for more preventive services has caused Medicare spending to rise. "Physicians are more aggressively targeting healthier beneficiaries over time. In 2002, nearly 60 percent of Medicare beneficiaries treated for five or more conditions reported being in excellent or good health, versus only 33 percent in 1987," they claim.

Thorpe and Howard use treatment of metabolic syndrome, a disease that affects half of all Medicare benes, as an example of increased physician services. "In the 1988-94 period, about 57 percent of beneficiaries with metabolic syndrome received treatment for diabetes, high blood pressure, or low levels of high-density lipoprotein (HDL, or 'good') cholesterol, conditions associated with the syndrome," the study says. In contrast, 68 percent of Medicare benes with metabolic syndrome were receiving treatment for at least one of these three conditions by 1999 through 2002, the researchers note.

"Physicians are more aggressively treating these patients now, which in the interim is driving up spending," Thorpe observes. "But the real question is whether treatment is improving quality of life and increasing longevity," he points out, noting that "increases in longevity for people with chronic conditions prolong the period over which they incur high costs year in and year out."

Unfortunately, the Medicare system itself doesn't help physicians to treat patients with multiple chronic conditions, Thorpe says. The Medicare fee-for-service structure in particular doesn't reimburse for services such as preventive measures and monitoring blood sugar and medication intake, which are all critical to treating and medically managing chronic illnesses, he maintains.

To read the study, go to http://content.healthaffairs.org/cgi/reprint/hlthaff.25.w378v1.