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Chronic Conditions Crank Up Health Costs

CHARLOTTESVILLE, Va. - Raymond Harris is only 54, but he already has gone through three kidneys.

Like most people, Harris was born with two working kidneys. He lost one at age 8 because of a fall. He lost the second to high blood pressure at 42. He lost the third - donated by his wife - at age 48, because of a rare reaction to a dye that doctors used to view the blockages in his arteries.

And while Harris gets a lot of health care, he isn't exactly healthy.

He has had three back surgeries and six heart attacks and depends on dialysis to survive. If medications fail to clear his arteries, he may need open-heart surgery. And less than one month after his latest heart attack, Harris is back in the emergency room at the University of Virginia Medical Center with chest pain.

While Harris' health problems may seem extraordinary, doctors say that many Americans today appear destined to share his fate.

Nearly half of Americans have a chronic condition, and 75% of the $2.6 trillion spent annually on health care goes to treat patients with long-term health problems, says Kenneth Thorpe, a professor at Atlanta's Emory University and head of the Partnership to Fight Chronic Disease. In the Medicare program, which pays for Harris' care because of his kidney failure, 95% of spending is linked to a chronic disease.

"All of these diseases are accumulations of what's happened before in a person's life," says Barbara Starfield, professor of public policy at Johns Hopkins University in Baltimore. "We have to think about keeping people as healthy as possible so they don't get these diseases."

Doctors say Harris' story is filled with missed opportunities to avoid disease, but also illustrates possibilities for change - both through healthier lifestyles and more coordinated primary care - that could reduce suffering and unnecessary costs.

"It would have been nice to catch him in his 20s and get him to stop smoking," says Robert O'Connor, professor and chair of emergency medicine at the University of Virginia, who treated Harris in the ER. "I suspect he had high blood pressure back then. . . . I can't help but wonder if that would have provided a better outcome for him."

Although health officials have exhorted Americans for years to get in shape, two-thirds of adults today are overweight. But insurance plans could help in other ways, such as by covering smoking-cessation classes and other services with well-documented health benefits, says Ted Epperly, president of the American Academy of Family Physicians.

Harris gave up tobacco on his own last month after his last heart attack, after smoking a pack a day for decades. Now, he puts $5 a day in a jar - the amount he used to spend on cigarettes - and will use the savings to help pay his mortgage.

"It would save a lot of money," he says. "These health problems are going to cost them way more than the classes."

Role of insurance payments

Harris has lots of company in the ER this day. Doctors will have seen nearly 200 patients before it's over. When the ER runs out of rooms, doctors will treat patients on gurneys in the hallway.

"We don't have a robust primary-care system, so that we can't get all of these people taken care of in the right place at the right time by the right type of doctor," Epperly says.

Uninsured patients aren't the only ones using the ER for non-urgent care. With too few primary-care doctors to go around, many patients turn to the ER when they can't get an appointment with their regular physician, says Sandra Schneider, vice president of the American College of Emergency Physicians.

In some ways, insurance payments contribute to the shortage, Epperly says, by discouraging physicians from going into primary care.

Medicare, which covers people over 65, pays doctors far more to perform procedures than to monitor a patient's overall health, Epperly says. In the past decade, only 10% of new doctors - who graduate from medical school with an average of $140,000 in student loans - have gone into primary care, Epperly says.

"We have a terribly perverse incentive system," says Stuart Butler, a health analyst and vice president for domestic research with the Heritage Foundation in Washington.

Patients with chronic conditions may see specialists who each treat a different symptom or deteriorating organ. But these doctors may rarely if ever get together to talk about the patient's overall health, Starfield says. Under Medicare's current system, no one is paid to coordinate all these services. And no one is accountable for helping the patient get better, she says.

Medicaid, which covers poor children and the disabled, also discourages doctors from taking on new patients. The federal program, which is run by the states, pays doctors an average of 28% less than Medicare, says David Tayloe, president of the American Academy of Pediatrics. So many doctors refuse to treat patients on Medicaid.

Children on Medicaid who need pediatric specialists may wait months for an appointment, Tayloe says. Yet children on Medicaid are among the most vulnerable to long-term disease. "A lot of the cost of ignoring children," he says, "comes to play when they become sick adults with chronic preventable problems, like type 2 diabetes."

A program that works

Successful regional programs could serve as models for national health care reform, says Tayloe, who practices in rural Goldsboro, N.C. North Carolina, for example, saves $150 million a year through a "visionary" Medicaid program, he says.

The plan encourages doctors to accept Medicaid patients by paying extra monthly fees that reflect the level of sickness of their patients, Tayloe says. A community health network gets an extra fee to coordinate patient care and make sure that kids stay healthy.

In the Seattle area, Group Health Cooperative experimented with a "patient-centered medical home," which allows doctors to see fewer patients but spend more time coordinating their care. Patients in the new program had 29% fewer ER visits and 11% fewer hospitalizations, according to a study published in the American Journal of Managed Care last week. The program paid for itself within a year.

Butler also has high praise for the way Pennsylvania's Geisinger Health System cares for the chronically ill. Before patients are discharged from the hospital, a nurse makes a follow-up appointment, then calls patients to remind them to show up. "This is not only good medicine, this is good cost control." Health systems could greatly improve their care by following Geisinger's example, he says.

Several proposals for health reform could help, too, Tayloe says. A bill in the House of Representatives would improve payment for primary-care doctors who see Medicare and Medicaid patients, raising Medicaid rates even more significantly so that they equal those in Medicare.

Other proposals in Congress would establish a pilot program to test more "medical home" models like the one at Group Health and fund a study on ways to balance the supply of specialists and primary-care providers. Doctors on "community health teams" would be paid to oversee patients' care. The teams would include nurse practitioners and physician assistants - who can handle many primary-care needs more cheaply than doctors - as well as dietitians, mental health counselors and others.

Such programs don't always save money. But transforming primary care could help the country to spend its money more wisely, says Ann O'Malley of the Center for Studying Health System Change in Washington. Right now, she says, Americans spend far more on health care than most other Western countries but have "much, much worse outcomes."

"The goal," she says, "is to get better value for the health care dollars we're already spending."

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