Chronic Diseases Spark Dramatic Increases in Treatment Costs While Lowering Productivity, Study Says

Seven chronic diseases are costing the U.S. economy more than $1 trillion in direct and indirect medical costs each year, a figure that could soar to nearly $6 trillion by the middle of this century unless steps are taken to reduce the incidence of these conditions. That's the gist of a recently released report from the Milken Institute, a member of the Partnership to Fight Chronic Disease, a coalition that includes the AAFP.

"An Unhealthy America: The Economic Burden of Chronic Disease" uses 2003 data from the Agency for Healthcare Research and Quality's Medical Expenditure Panel Survey, or MAPS, to calculate the economic loss associated with seven chronic conditions -- cancer, diabetes, hypertension, stroke, heart disease, pulmonary conditions and mental illness. The report, which was funded by a grant from the Pharmaceutical Research and Manufacturers of America, also calculates the resulting effect on the nation's gross domestic product, or GDP, and U.S. businesses.

The MAPS data indicate that more than 109 million Americans have at least one of the seven chronic conditions, and some have two or more of these conditions, for a total of 162 million cases. Lost productivity resulting from these chronic conditions is estimated to be $1.3 trillion a year, with another $277 billion spent annually on treatment. This combined figure does not include costs to treat subsequent health consequences of these diseases, according to the report.

Based on current trends, the report projects a 42 percent increase in cases of the seven identified chronic diseases by 2023, resulting in $4.2 trillion in treatment costs and lost economic output, a number that jumps to $6 trillion by 2050.

"Dramatic improvements in therapies and treatment have led to higher quality of life, less disability and lower rates of mortality," says the report. "Fatality rates for colon cancer began to drop in the early 1980s, while breast, prostrate and lung cancers followed similar patterns in the early 1990s." In addition, advances in the treatment and prevention of heart disease have led to dramatic improvements in morbidity and longevity; however, increasing rates of chronic diseases are threatening to cancel out these gains.

"Reducing the avoidable costs associated with these conditions is central to meeting the twin challenges of promoting affordable health care and fostering continued economic growth," the report says. "We have a choice: Continue on the current path or alter it by changing our behaviors and focusing on prevention and early intervention."

An investment in "good health is an investment in economic growth," says the report, which makes two recommendations: Create incentives in the health care-system to reward prevention, and renew the nation's commitment to achieving a healthy body weight.

"Employers, insurers, governments and communities need to work together to develop strong incentives for patients and health care providers to prevent and treat chronic disease effectively," says the report, pointing out that only a fraction of current health care spending is focused on promoting healthier behaviors. "An increased emphasis on prevention would both improve the health of Americans and offset some of the costs of an aging population by increasing economic productivity."

The report estimates that modest improvements in preventing and treating disease could avoid 40 million cases of chronic disease by 2023, reducing the economic impact of such diseases by 27 percent, or $1.1 trillion annually. This would increase the nation's GDP by $905 billion because of productivity gains and result in a decrease of $218 billion a year in treatment costs.

The report points out that lower obesity rates alone could "reduce cases of illness by 14.8 million in 2023, which cuts $60 billion from the national treatment bill and improves GDP by $254 billion." Interestingly, the report finds that a "parallel calculation for smoking alone suggests that lower tobacco use is responsible for 9.4 million fewer illnesses in 2023, along with $31 billion less in treatment costs and $79 billion in added productivity."

"Obesity is really the new tobacco," said Armen Bedroussian, M.A., research economist in regional economics for the Milken Institute and co-author of the study.

In the early 1990s, about 15 percent of the nation's population was obese, and now that number stands at about 25 percent, said Bedroussian in an interview with AAFP News Now. One of the goals, he said, is to reduce overall obesity rates to where they were 10 or 15 years ago.

"These are not drastic improvements," Bedroussian said. "We don't have to go out of our way to make these things happen."

The report's findings underscore the importance of prevention and primary care, and the need to shift the nation's health care system from an acute care model to a preventive one, said Bedroussian.

"That would definitely reduce chronic disease," he said.