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Congress Underestimating Savings From Treating Chronic Disease

If Congress wants to find ways to curb the crushing costs of health care, it must modernize how it assesses the costs and savings of treating chronic disease, which accounts for 75 percent of our nation’s annual health spending.

[IMGCAP(1)]Diabetes is a great example. Diabetes has reached epidemic levels in recent years. It is increasing at faster rates than any other chronic disease. It affects almost 24 million Americans and costs the nation $218 billion each year in medical expenses and lost productivity.

The National Institutes of Health and the Centers for Disease Control and Prevention have found that early and aggressive programs to manage diabetes can prevent and/or minimize costly and devastating complications such as kidney failure, heart attack, stroke, blindness and amputation that occur in later years.

Unfortunately, the Congressional Budget Office, which is responsible for determining the costs and savings of health reform legislation, only “scores,— or takes into consideration, the cost reductions that are achieved in the first 10 years of a program. Meanwhile, data from the NIH find that an intensive diabetes management program only begins to yield lower spending on diabetes treatment and complications after about eight years, with the bulk of the reductions occurring between years 10 and 20.

The result is that the CBO’s current scoring system underestimates the longer term economic benefits associated with aggressive diabetes management programs. This, in turn, makes it less likely for Congress to support government funding for such efforts.

A 10-year estimate works well for the vast majority of Congressional policies. However, in the 21st century, data from clinical trials and epidemiologic studies demonstrate that the course of treating chronic disease does not fit within this narrow framework. Extensive and scientifically rigorous research now available can greatly improve the Congressional Budget Office’s cost estimates of chronic disease intervention programs. It should take advantage of this data.

It is time Congress considers this important body of epidemiologic evidence to understand the progression of chronic disease when determining the costs and savings associated with intervention programs. It is time the CBO uses the best available epidemiologic models as well as actuarial and economic models when predicting costs associated with disease interventions.

Investing in intensive diabetes management programs that have been proven to reduce devastating complications from chronic disease is sound economic policy. That is why Congress needs to recognize the long-term benefits as well as the short-term costs involved in such interventions.

Fighting chronic disease is costly and hard. However, we do not have to make it look more costly than it really is. Overlooking the cost reductions associated with fewer kidney transplants, dialysis, heart attacks, strokes, blindness and amputations resulting from interventions pioneered by the NIH and CDC because they occur outside a 10-year budget window is harmful to the health of our economy and our people.

Congress has an opportunity to reduce the personal and economic toll of diabetes, heart disease and cancer real cost drivers in our health care system by an accurate and robust assessment of the costs and savings associated with chronic disease interventions. Now is the time to do so.

Michael J. O’Grady, Ph.D, a former assistant secretary for planning and evaluation at the Department of Health and Human Services, is principal of O’Grady Health Policy and a senior fellow at the National Opinion Research Center at the University of Chicago.

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