Chronic conditions and U.S. health care

Two strategies that are promising in bringing healthcare costs incurred by people with chronic illnesses under control are: (1) investment in the management of care, including coordination, for patients with chronic conditions, and (2) investment in health promotion programs to help prevent the development of such conditions, including programs that target obesity and alcohol or drug use. For example, the new Prevention and Public Health Fund, created as a result of the Affordable Care Act, will invest $15 billion over 10 years to prevent diseases, detect conditions early, and manage chronic conditions before they become severe and result in significant expenditures.

According to the 2008 Chronic Conditions Public Use File (PUF) released by The Centers for Medicare & Medicaid Services (CMS), more than one-third (38 percent) of Fee-for-Service (FFS) Medicare Part A beneficiaries who had no chronic conditions accounted for only 3 percent of Medicare Part A program payments. The remaining 62 percent of Medicare Part A beneficiaries had at least one chronic condition and accounted for 97 percent of Part A payments. Similarly, 67 percent of FFS Part B beneficiaries had at least one chronic condition and accounted for more than 91 percent of all Part B payments. Medicare Part A and Part B payments for enrollees with at least one chronic condition came to more than $260 billion in 2008 (94 percent of total FFS payments). Results also indicate that having one chronic condition increases average Part A (Part B) payments by about a factor of 4.8 (2.4).