Diabetes: Hospital Bills Cost U.S. $83 Billion A Year
Diabetes affects nearly 25 million Americans, and that number is expected to grow substantially every year. It’s the fifth leading cause of death in America, more than breast cancer and AIDs combined. And according to a report released last week from the Agency for Healthcare Research and Quality (AHRQ), it’s a disease that’s costing Americans $83 billion a year in hospital fees — 23 percent of total hospital spending.
“Diabetes continues to increase both in the prevalence and the costs,” says one of the authors of the report, Dr. H. Joanna Jiang. “It’s a chronic condition, affecting almost the entire body, which can result in a lot of complications and make the patient high risk for hospital care.”
Though the report did not distinguish between Type 1 and Type 2 diabetes, there are differences. Type 1 is caused when the body fails to produce insulin, usually diagnosed at an early age; Type 2 is overwhelmingly caused by poor diet and lack of exercise (though it can also be genetic). Ninety-five percent of diabetes cases in America are Type 2, which typically affects the elderly, the obese, and a growing number of children. Both of these demographics rely heavily on Medicare and Medicaid for treatment. In fact, according to the report, Medicare paid 60 percent of the hospital stays for diabetics; Medicaid paid 10 percent.
According to a 2007 study, “Economic Costs of Diabetes in the U.S.,” by the American Diabetes Association, the cost of diabetes is even higher: $174 billion ($116 billion in total medical expenditures, including drugs and office visits, in addition to the hospital costs, and $58 billion in reduced national productivity).
- One of every five health care dollars is spent caring for someone with diabetes.
- Diabetics have medical expenditures that are 2.3 times higher than other victims of chronic disease.
- They have more frequent and longer hospital stays, more doctor and emergency visits, more nursing facility stays, more home health visits, and more prescription drug and medical supply use.
Add to this the costs of the hidden diabetes epidemic: $18 billion for the estimated 6.3 million people with undiagnosed diabetes, and $25 billion for 57 million, or one in four, American adults with pre-diabetes. Those with pre-diabetes are likely to develop Type 2 diabetes within 10 years. If the current trend continues, one in three children faces a life with diabetes.
“The burden of diabetes is imposed on all sectors of society — higher insurance premiums paid by employees and employers, reduced earnings through productivity loss, and reduced overall quality of life for people with diabetes and their families and friends,” the authors conclude.
With 95 percent of cases being Type 2 diabetes, that’s some $206 billion spent on a disease that can largely be controlled and prevented by diet and exercise. “One of the key messages here is that [these costs] could be prevented,” says Burgess of the AHRQ report. “Some of the hospital admissions and costs could be prevented if the patient could take care of their own conditions: monitor their blood sugar level, their behavior or lifestyle — you know, watch their diet and exercise more.”
Type 2 diabetes wasn’t even identified until the mid-1930s. Since then, cases have ballooned due to better diagnosis, but also the sedentary, high-calorie American lifestyle. Dr. Richard Bergenstal, executive director at the International Diabetes Center in Minneapolis and spokesperson for the American Diabetes Association, says that he sees this evidence in globalization and immigrants coming to the U.S.; their rate of diabetes doubles or even triples after they assimilate to the American lifestyle.
“Look at China or India,” he says, “They didn’t used to have much Type 2 diabetes, but as soon as the country gets a little more prosperous or industrialized, and we export KFC or McDonalds, or people start to drive instead of walk, the rates start skyrocketing. This epidemic is now global.” In fact, as of March 2010, China now ranks number one in the number diabetes cases — with over 92.4 million adults. India is number two.
Health care costs are particularly high for diabetics due to the frequency of complications. Heart failure, pneumonia, pulmonary disease, blindness, hypertension, even Alzheimer’s, can all be related to or caused by diabetes. “We need to look at those buckets and shift the costs from treating complications to better managing diabetes,” says Dr. Bergenstal. “It’s so expensive because we haven’t moved up front enough. We’re still reacting.”
As cost-saving measures, Dr. Bergenstal suggests having a multidisciplinary team, such as a nurse and a dietitian, in addition to a regular physician, to tackle things like diet and exercise counseling, as well as increasing diabetes education. “So much of the cost is emergency room visits for low blood sugar or high blood sugar,” he says. “And you ask, ‘why did you go to the emergency room?’ And it was just something the patient didn’t understand.”
Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.