A Case for Change
The nation’s health care system has been steadily progressing on a path of escalating costs without corresponding improvements in outcomes.
Costs borne by individuals, employers and governments continue to grow exponentially each year. According to the World Health Organization, the United States spends more than 17.9% of its gross domestic product (GDP) annually on health care — the highest such percentage in the world. U.S. health care spending is forecasted to reach 25% of GDP in 2025.
Employer-sponsored health insurance premiums increased 119% from 1999-2008 and could double again by 2020 if these trends continue. Ballooning health care costs continue to put American businesses at a global competitive disadvantage. Care for patients with chronic conditions is driving many of these costs. Approximately 15% of beneficiaries account for more than 75% of Medicaid spending. Almost all have multiple chronic conditions.Transforming the manner in which we manage the care of those individuals presents an opportunity to positively impacting health costs in Missouri and across the country.
Despite America’s high national per capita costs compared to other industrialized countries, our health care system produces health outcomes that lag behind most other industrialized nations.
In Missouri, our challenges are even greater. According to the 2012 America’s Health Rankings, Missouri ranked #42 out of 50 in overall health, down from #40 a year earlier. In Missouri, more than 30% of adults are obese. This is a concern because obesity is a leading cause of preventable death in the U.S., causing an estimated 200,000 deaths annually. It is also a leading risk factor for diabetes, heart disease, stroke, and certain forms of cancer.
In the past year, the diabetes rate increased to 10.2% from 9.4% of the adult population in Missouri.
The direct medical costs for treating obesity and obesity-related health problems are overwhelming.
In 2008, it was estimated that $147 billion was spent on obesity or obesity-related health issues, up from $78.5 billion in 1998, and as the rate of obesity continues to grow, so will the costs.
To address these challenges, Congress has passed two major pieces of legislation — the Patient Protection and Affordable Care Act (PPACA) and the American Recovery and Reinvestment Act (ARRA, the stimulus).
Together, these laws have laid the foundation for establishing new rules for providers who provide health care services, sponsors who pay for these services, and individuals who consume these services. In the future:
- Providers will be increasingly held accountable for quality and outcomes
- Sponsors will invest in programs and services that promote health and wellness
- Individuals will be more invested and engaged in managing their own health
The Tiger Institute partnership is striving to turn these trends around by innovating how we care for patients with chronic conditions, transforming how we coordinate care between caregivers, and engaging individuals with the tools and incentives to proactively manage their own health. These actions will create value in health care, starting in Missouri, but serving as a model for America.
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