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Health Care Costs and Financing

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Heart disease, cancer, and trauma injury top the list of the 15 most costly medical conditions in the United States

The most expensive medical condition in the United States in 1997 was heart disease, which was associated with $58 billion in expenditures, followed by cancer ($46 billion), and trauma-related injuries ($44 billion). Heart disease accounted for about 10 percent of total expenditures in 1997; cancer and trauma accounted for 8 percent each. However, pulmonary conditions affected the largest number of people (41 million), followed by trauma (37 million), and hypertension (27 million). These are the findings of a study by Joel W. Cohen, Ph.D., and Nancy A. Krauss, M.P.H., of the Center for Cost and Financing Studies, Agency for Healthcare Research and Quality.

In response to an Institute of Medicine request for AHRQ to examine a set of priority conditions, the researchers used 1997 data from the Medical Expenditure Panel Survey (MEPS) to identify the 15 most expensive medical conditions. The MEPS provides estimates of health care use, spending, sources of payment, and insurance coverage for the U.S. civilian noninstitutionalized population.

The researchers examined both direct health care costs for the conditions and the total costs for all medical care incurred by people with these conditions. They found that, in general, higher mean expenditures were associated with the extent to which spending was related to inpatient hospitalization. For example, inpatient care accounted for about two-thirds of expenditures for cerebrovascular disease and cancer—the top two conditions in terms of mean expenditures—but only about one-quarter of expenditures were for infectious diseases and skin disorders, the least expensive conditions in the set. On the other hand, more than half of average spending for kidney disease (which had the third highest mean expenditures) was for outpatient care, most likely related to dialysis. Most people with at least one of the top 15 conditions had other medical problems. Per capita spending increased as much as 8- to 11-fold for people with three or more medical conditions versus only one.

More details are in "Spending and service use among people with the fifteen most costly medical conditions, 1997," by Dr. Cohen and Ms. Krauss, in the March 2003 Health Affairs 22(2), pp. 129-138.

Reprints (AHRQ Publication No. 03-R029) are available from the AHRQ Publications Clearinghouse.

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