Personal health care spending from 1996 to 2013 analyzed

Despite the increase in health care spending in the United States, not enough is known about how private and public spending varies according to condition, age and sex group, and type of care. An investigative study of government budgets, insurance claims, U.S. government records, and facility and household surveys, published by JAMA, concluded that from 1996 to 2013 there was $30.1 trillion in personal health care spending for 155 separate conditions, with spending on diabetes, ischemic heart disease, and low back and neck pain accounting for the highest amounts of spending.

Conditions and type of care. The 155 conditions examined included cancer, which was broken down into 29 separate conditions. For the top three spending conditions, the study made the following findings for 2013:

  • Diabetes had the highest health care spending in 2013, with an estimated $101.4 billion in spending, including 57.6 percent spent on pharmaceuticals and 23.5 percent spent on ambulatory care.
  • Ischemic heart disease had the second-highest amount of health care spending in 2013, with estimated spending of $88.1 billion.
  • Low back and neck pain had the third-highest amount of health care spending in 2013, with estimated health care spending of $87.6 billion.

The study’s analysis of spending from 1996 through 2013 found that personal health care spending increased for 143 of the 155 conditions. Additional study findings regarding spending increases from 1996 through 2013 include:

  • Low back and neck pain spending increased by an estimated $57.2.
  • Diabetes spending increased by an estimated $64.4 billion.
  • Emergency care spending increased 6.4 percent.
  • Retail pharmaceutical spending increased 5.6 percent.
  • Inpatient care spending increased 2.8 percent.
  • Nursing facility spending increased 2.5 percent.

Age and spending. The study found that spending among working-age adults, totaling an estimated $1 trillion in 2013, was attributed to many conditions and types of care. Among persons 65 years or older, an estimated $796.5 billion was spent in 2013, with 21.7 percent occurring in nursing facilities. The smallest amount of health care spending was found to be for persons under age 20 years, with an estimated at $233.5 billion spent, or only 11.1 percent of total personal health care spending in 2013.

Age, sex and spending. The study found that the greatest spending was for individuals between 50 and 74 years, with spending highest for women 85 years and older. Because life expectancy for men is lower, the study found less spending by men in the 85 years and older age group.

Estimated spending differed the most between the sexes from age 10 to 14 years, according to the study, when males have health care spending associated with attention-deficit/hyperactivity disorder, and at age 20 to 44 years, when women have spending associated with pregnancy and postpartum care, family planning, and maternal conditions. Together the study estimated that these conditions constituted 25.6 percent of all health care spending for women from age 20 through 44 years in 2013. Without this spending, the study concluded that females spent 24.6 percent more overall than males in 2013.

Conclusion. The study concludes that this information is important because it may have implications for efforts to control U.S. health care spending.

FDA, CMS facilitate continuity between approval of, payment for medical products

Fragmentation in the process of approving and clearing drugs for marketing by the FDA and then clearing drugs for coverage by CMS has led to questions regarding whether FDA approval necessarily results in approval for coverage and payment under Medicare and Medicaid. In a Journal of the American Medical Association (JAMA) perspective written by CMS Acting Administrator Andy Slavitt, FDA Commissioner Robert Califf, and FDA Deputy Commissioner for Medical Products and Tobacco Rachel Sherman, the authors posit that, despite such challenges, changes in the organization of health care and the larger technology landscape should allow the FDA and CMS to move toward the use of shared sources of evidence while still applying the most appropriate criteria to decision making.

In product approval and clearance for marketing by the FDA and in coverage and payment determinations by CMS, the agencies use scientific evidence to make determinations. The use of shared sources of evidence would help to reduce gaps in information that could lead to uncertainty in the approval or clearance of new therapies, as well as their subsequent use in medical treatment. Shared information would also increase efficiency in medical product development and ensure the use of high-quality evidence.

It is standard practice to use in the approval and clearance for marketing process research examining the effects of therapeutics in narrow, strictly delineated populations that may not reflect the clinical practice settings in which the products will be used. The authors stressed that when a product demonstrates promise in this narrow setting, developers should pivot quickly toward evaluating the product, using “evidence about the risks and benefits of tangible health outcomes in clinical settings and among patients representative of those who will actually use these products.” The expansion of the scope of research used in the approval and clearance process will help show how a product is likely to perform and how to utilize the product in treatment.  Garnering early involvement of health systems and payers will help the agencies to determine what kinds of evidence are needed to incorporate the product in practice, where the product fits in formularies and device inventories, and whether or how much to pay for its use.

The FDA and CMS are focusing on the following to ensure that adequate evidence is available to guide patients, clinicians, and payers in their choices:

  • clarifying the need for including diverse populations and measuring relevant clinical outcomes within the trials conducted for regulatory approval and to inform labeling;
  • collaborating with other federal agencies to build functional links across a range of systems to make the best use of existing digital information captured in the course of health care delivery, such as electronic health records, insurance claims, and data within clinical registries; and
  • ensuring broad collaboration across public and private sectors.