Chronic conditions plus functional limitations causing high health needs, spending

Adults with multiple chronic diseases that limit their ability to perform routine tasks, including self-care, have much higher health needs than other patients. These health care needs correlate with higher health spending for these patients, and a one-size-fits-all approach to improving health outcomes and lowering spending may not be effective. The Commonwealth Fund (CWF) studied this patient population and concluded that functional limitations are a large part of the reason that these patients are high-need, and that focusing on the unique needs of these patients may be the key to reducing spending.

High-need patients, costs, and income

About 12 million adults in the U.S. meet the definition of high-need, with 79 million having at least three chronic diseases without the functional limitations. The average cost of health care services and prescription medicines for high-need patients was about $21,000. This amount was about three times the average for those without functional limitations, and over four times the average for the total population. The CWF classified “high-cost” individuals as those with total annual medical expenditures landing them among the top 5 or 10 percent of costly patients. One of six high-need adults remained in the top 5 percent group for two years in a row. High-need patients were not well equipped to handle their out-of-pocket costs, as the annual median income these patients was less than half of the total population. Those without functional limitations had much lower out-of-pocket costs and almost the same average income as the total population.

Demographic

The CWF found that high-need patients shared many traits. Over half were at least age 65, two-thirds were women, and almost 75 percent were white non-Hispanic. Over half made less than 200 percent of the federal poverty level, and most were covered by Medicare, Medicaid, or both. Comparatively, two out of five with multiple chronic conditions but no functional limitations were publicly insured. High-need adults also used hospital emergency departments twice as much as those without functional limitations, and more than three times as much as the total population. They were also much more likely to be hospitalized. The CWF’s report noted that not all high-need adults were frequent hospital users, and that about 65 percent had no emergency visits in a year.

Conclusions

The CWF believes that the high-need patient group will continue to incur high health spending at a higher rate than those without functional limitations, and that the health care industry should focus on high-need patients as a subpopulation when considering patients for care management programs. It also believes that the subpopulation should be further split into subgroups due to variation in the health care services needed. By focusing on patients’ unique needs, payers and providers can find more efficient and cost-effective ways to provide better services that will result in improved health outcomes.