Understanding Healthcare Expenditure Trends: Challenges and Opportunities

The content discusses the trends in healthcare expenditure, focusing on issues such as increasing costs, decreasing Medicare and Medicaid spending, and comparative costs of end-of-life care by state. It raises questions on the sustainability of these trends and what actions are needed to address them effectively.

• Healthcare expenditure
• Trends
• Medicare
• Medicaid
• Sustainability

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1. HealthTech Net September 20, 2013 John M. (Jay) Shiver, MHA, LFACHE, FAAMA Assistant Professor Health Administration and Policy Where Innovation Is Tradition

2. Thidwick our healthcare system Where Innovation Is Tradition

3. Everything Costs More Why is this any Different? This cost is covered somewhere Where Innovation Is Tradition

4. Growth Per Capita, Compared to Prior Year The recession isn t the only reason for the change. 12 10 8 6 NHE 4 GDP 2 0 1990 2000 2007 2008 2009 2010 2011 -2 -4 1990 9.9 6.6 2000 5.5 4.4 2007 6.6 4.1 2008 3.7 0.9 2009 3 -3.1 2010 3.1 2.9 2011 3.1 3.2 NHE GDP NHE = National Health Expenditures GDP= Gross Domestic Product Source: Hartman et al. "National Health Spending in 2011" Health Affairs Jan 2013 Where Innovation Is Tradition

5. Medicare and Medicaid Spending Also Decreasing 20 15 10 Medicare Medicaid 5 0 2005 2006 2007 2008 2009 2010 2011 -5 2005 2006 2007 2008 2009 2010 2011 Medicare 9.2 18.8 7.4 8 6.9 4.3 6.2 Medicaid 6.4 -0.9 6.3 5.8 8.8 5.9 2.5 Source: Cutler D., Shani, N. "The Forecast Slowdown in Medicare Spending" Journal of the AMA 2/21/13 Where Innovation Is Tradition

6. End of Life Care Costs surrogate for comparative costs by state DC MD $9,000 $8,000 $7,000 VA $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 Hawaii Nevada Wyoming Iowa Mississippi Nebraska Colorado Connecticut Illinois Texas Arkansas Ohio Louisiana Maine Virginia Alabama Minnesota New York California West Virginia Indiana Idaho New Jersey Vermont Michigan Florida Delaware Massachusetts Missouri New Hampshire Wisconsin Montana Oregon Kansas South Dakota North Dakota Tennessee Oklahoma District of Columbia Alaska Georgia Kentucky Washington Utah Pennsylvania New Mexico Arizona Maryland Rhode Island North Carolina South Carolina Where Innovation Is Tradition

7. Questions for Today OK, So it s down a bit? Is this just a trend? Is it sustainable? What will it take to maintain? Where Innovation Is Tradition

8. It is about the attitude Politically everyone seems to concur that continued cost growth is not sustainable, Differences arise relative to how to change There are reasons it is not easy Deep seated self interests top to bottom Perhaps most complex business model It is not just about the money Do not forget: Our system does what we pay the it to do Where Innovation Is Tradition

9. Some thoughts about Status Quo The healthcare system is comprised of people trying to do the right things Many efforts have been successful in reducing costs, improving health, extending useful fruitful lives, making us healthier longer. Science, technology, re-engineering process creating new professionals .all have helped. However the basic malaligned structure remains: we pay the system to heal us & ya gotta be sick to be healed Where Innovation Is Tradition

10. Challenges and Changes Partisanship Hurts We all seem to agree we can t stay the course This issue is too large for fear mongering There s a model to work with, start there Where Innovation Is Tradition

11. Challenges and Changes Clinicians need lead the effort This is a complex science Financial bullying starts a fight Those in the trenches, physicians especially, know the total costs of care and the consequences Give them truthful, transparent financial and quality data Keep the financial incentives focused on quality and outcomes Where Innovation Is Tradition

12. Challenges and Changes Solutions may not be universal Healthcare is local but there are unjustifiable variations Local cultural differences do influence health Local financial issues matter Where Innovation Is Tradition

13. Challenges and Changes Engage the consumers Personal responsibility will come into play We saw what fear of change can do before: remember the death panels? Where Innovation Is Tradition

14. Closing thoughts There ain t no magic silver bullet There are opportunities out there Society needs your help Technology will play a lead role Focus on outcomes Where Innovation Is Tradition

15. Examples of New Healthcare http://www.youtube.com/watch?v=vcdzP4dX-dE Where Innovation Is Tradition