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Health Care Costs: Why Do They Increase? What Can We Do?

Disease Management


Autumn Dawn Galbreath, M.D., Director, University of Texas Disease Management Center, San Antonio, TX.

Maresa R. Corder, R.N., M.P.A., R.N. Consultant, State of Florida, Agency for Health Care Administration, Florida Medicaid, Tallahassee, FL.

Disease management is a population-based, systematic approach to identify people at risk for specific diseases, intervene with a program of care, and measure outcomes. Disease management emphasizes providing a continuum of care for those with chronic illness.

Important characteristics of disease management include:

  • Incorporating best medical practices throughout the continuum of care.
  • Developing clinical guidelines through the review of medical literature.
  • Improving measurable outcomes in the quality of care.
  • Providing the care at reduced cost.

According to Autumn Dawn Galbreath, M.D., disease management assumes that medical practice varies and that this variation is related to differences in outcomes. It also assumes that it is possible to develop a system that optimizes patient care and improves outcomes, resulting in decreased costs over time.

Dr. Galbreath is project director of the South Texas Congestive Heart Failure (CHF) Demonstration Project. This project is a collaboration among the Department of Defense (DoD), the Veterans Administration (VA), and the University of Texas Health Science Center in San Antonio, Texas, and is funded through a Congressional appropriation. It is the first demonstration of its kind for a CHF population and the first major Federal evaluation of a disease management program. The targeted enrollment for the study is 1500 patients diagnosed with CHF including veterans, Medicaid, Medicare, and military populations.

The demonstration project is a prospective three-year randomized study that began in January 2000 to evaluate the use of clinical guidelines. The study design involves collaboration between patients, physicians, and nurse disease managers (critical care nurses). The patients are divided into three groups: traditional physician care, comprehensive disease management, and comprehensive disease management with technology. The "with technology" group involves greater self-management by patients using technology such as blood pressure cuffs that patients can use in their homes.

The project's objectives include improved clinical outcomes, improved patient and provider satisfaction, and economic outcomes such as decreasing total healthcare resource utilization and projected cost savings with long-term use of a disease management protocol. Results are expected in late 2003.

Maresa Corder, R.N., M.P.A., works in Florida Medicaid's disease management program, which began in 1997 with authorization from the State legislature. At the time of the authorization the legislature reduced the State's Medicaid budget by about $4 million, the amount of projected savings in the first year of the program. In 1998, the legislature reduced the budget by an additional $38 million for continuation and expansion of the program. Similar budget reductions have continued in subsequent years.

Corder reported that because of pressure to implement disease management quickly, Florida Medicaid did not have time to build or design their own protocols. Florida's program involves a number of contracts with private Disease Management Organizations, which direct programs for individual diseases. Current and recent expansions of Florida's program include disease management for asthma, AIDS, diabetes, hemophilia, congestive heart failure, cancer, and several other diseases.

The objectives of Florida Medicaid's disease management initiative include:

  • Improved health outcomes.
  • More efficient use of health resources.
  • Better treatment of chronic medical conditions.
  • Reduced costs.

Corder also discussed methods for evaluating the need for disease management in a given patient population, noting that in Florida, a small percentage of patients, diseases, and drugs account for a majority of the State's Medicaid expenditures. An evaluation of Florida's disease management program began in 2000.

While there is abundant literature related to disease management, evidence thus far has not adequately shown that disease management increases efficiency in the care process for a disease. Of the 24 clinical trials previously published (see Additional Resources for a list of disease management trial references), only eight have been randomized controlled trials, and most of those lacked economic analysis.

While research has yet to prove that disease management works to improve clinical outcomes or decrease costs, programs in place to date are finding promising data. Although more research is needed. Galbreath believes that the effectiveness of a disease management program depends upon adequate infrastructure, information sharing, and cooperation among institutions.

Additional Resources

Center for Health Care Strategies, Inc. Informed Purchasing Series, Working Paper: Contracting for Chronic Disease Management: The Florida Experience, Executive Summary and Key Findings.

Florida Agency for Health Care Administration. The Florida Medicaid Disease Management Initiative: A Report on the Florida Medicaid Disease Management Program, Historical Perspective, Start-Up, Activities, Current Operations, Future Operations and Expectations. Florida AHCA. 2000 Feb.

Mitchell JM, Anderson KH. Effects of Case Management and New Drugs on Medicaid AIDS Spending. Health Affairs 2000 Jul-Aug 19(4):233-43.

Disease Management Trial References

Aubert RE, et al. Nurse case management to improve glycemic control in diabetic patients in a health maintenance organization. Ann Int Med 1998;129:605-12.

Cummings JE, et al. Cost-effectiveness of Veterans Health Administration hospital-based home care. Arch Int Med 1990;150:1274-80.

De Busk RF, et al. A case-management system for coronary risk factor modification after acute myocardial infarction. Ann Int Med 1994;120:721-9.

Fitzgerald JF, et al. A case manager intervention to reduce readmissions. Arch Int Med 1994;154:1721-9.

Fonarow GC, et al. Impact of a comprehensive heart failure management program on hospital readmission and functional status of patients with advanced heart failure. J Am Coll Cardiol 1997;30:725-32.

Gregg EW, et al. Evaluating diabetes health services interventions: true effects, changing tides, or moving targets? J Clin Endocrinol Metab 1999;84:820.

Kornowski R, et al. Intensive home-care surveillance prevents hospitalization and improves morbidity among elderly patients with severe congestive heart failure. Am Heart J 1995;129:762-6.

Martens KH, Mellor SD. A study of the relationship between home care services and hospital readmission of patients with congestive heart failure. Home Healthcare Nurse 1997;15:123-9.

Martin TL, et al. Physician and patient prevention practices in NIDDM in a large urban managed-care organization. Diabetes Care 1995;18:1124-32.

Mayo PH, et al. Results of a program to reduce admissions for adult asthma. Ann Int Med 1990;112:864-71.

Philbin EF. Comprehensive multidisciplinary programs for the management of patients with congestive heart failure. J Gen Int Med1999;14:130-5.

Rich MW, et al. A multidisciplinary intervention to prevent the readmission of elderly patients with congestive heart failure. N Engl J Med 1995;333:1190-5.

Rubin RJ, et al. Clinical and economic impact of implementing a comprehensive diabetes management program in managed care. J Clin Endocrinol Metab 1998;83:2635-42.

Selby JV, et al. Excess costs of medical care for patients with diabetes in a managed care population. Diabetes Care 1997;20:1396-1402.

Shah NB, et al. Prevention of hospitalizations for heart failure with an interactive home monitoring program. Am Heart J 1998;135:373-8.

Silliman RA, et al. The care of older persons with diabetes mellitus: families and primary care physicians. J Am Geriatr Soc 1996;44:1314-21.

Simons WR, et al. Effect of improved disease management strategies on hospital length of stay in the treatment of congestive heart failure. Clinical Therapeutics 1996;18:726-46.

Smith DM, et al. Postdischarge care and readmissions. Med Care 1988;26:699-708.

Tilney CK, et al. Improved clinical and financial outcomes associated with a comprehensive congestive heart failure program. Dis Manage 1998;1:175-83.

Toseland RW, et al. Outpatient geriatric evaluation and management. Med Care 1996;34:624-640.

Vinson JM, et al. Early Readmission of elderly patients with congestive heart failure. J Am Geriatr Soc 1990;38:1290-5.

Weinberger M, et al. A nurse-coordinated intervention for primary care patients with non-insulin-dependent diabetes mellitus: impact on glycemic control and health-related quality of life. J Gen Int Med 1995;10:59-66.

Weinberger M, et al. Does increased access to primary care reduce hospital readmissions? N Engl J Med 1996;334:1441-7.

West JA, et al. A comprehensive system for heart failure improves clinical outcomes and reduces medical resource utilization. Am J Cardiol 1997;79:58-63.

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