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Does preventive health care save money?
By JLP | June 17, 2008
I went to my primary physician for my annual physical last month, and I started wondering if it really does save money to go every year. My insurance company has obviously concluded that preventive medical visits save money in the long run, since it covers them 100%. I don’t even have to pay my usual $20 copay at my annual checkups. I’m guessing that the insurance company’s underwriters have done the math and concluded that catching something in the early stages is far and away cheaper to treat than finding something that’s already progressed. Makes sense to me.
So I was surprised to find this New England Journal of Medicine article, which concludes that the cost of preventive measures may or may not be lower than the cost of treatment, and in any event, that the costs aren’t that different. Of particular interest is this statement:
Although some preventive measures do save money, the vast majority reviewed in the health economics literature do not.
Does this surprise you?
Topics: Miscellaneous | 14 Comments »
June 17th, 2008 at 9:24 am
Not really. In many cases, lots of prevetive care will just show us that everything is fine, which technically means that the visit wasn’t really necessary. I liken it to the idea of bringing a vehicle in for warranty maintenance and having the parths changed on the schedule. Could the parts last a lot longer? Yes, probably. Could isave a lot of money by skipping those preventive maintenance checks? sure, until the timing belt gets thrown or the radiator starts leaking or the seal in teh oil pan gives way… then you have a much more expensive problem on your hands.
Maybe not the best analogy, but in general, putting small amounts of money at regulatr intervals to check and ensure taht nothing is wrong may save lots more down the road from a catastrophic incident. As for me, I’m hoping to never have to find out, hence why I plan on staying with my regular interval of maintenance check-ups
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June 17th, 2008 at 9:52 am
It depends. If you are a healthy, slim, young person then you can get by with a visit every other year or so – assuming you listen to your body, do breast exams if you are a woman, etc. But if you are even slightly overweight, have a stressful job, have a bad family health history of diabetes, cancer, high bp, heart disease, etc you’d better get annual check-ups.
I myself was diagnosed with hypothyroidism at 24 – which is pretty unusual. It isn’t anything serious, but untreated it can screw you up pretty bad. Needless to say I have to have my annual check ups despite being a young, trim, healthy person. I also had a few problems with high bp a few years ago due to a stressful job. I would have had no idea if I didn’t go for a check-up.
My husband is an endocrinologist and he sees a lot of thyroid disorders and diabetes cases where the patient had no idea until they visited their doctor or the ER. A little preventative care might have caught some of these cases before the trip to the ER.
June 17th, 2008 at 9:58 am
From a societal point of view it isn’t so clear either. Preventive health care can lead to longer lives by catching some problems early, but in many cases this may lead to even more expensive healthcare issues down the road (not to mention increased Medicare and Social Security costs). While your insurance company sees it in their interest to pay for preventative care, their liability ceases when you turn 65 and go on Medicare. If, depending to some degree on the upcoming elections, we move toward a single-payer system, the calculation becomes much more complicated. The system as a whole may save money when people die sooner.
June 17th, 2008 at 10:09 am
I’ve known for some time that it doesn’t. The main reason preventive drugs/tests aren’t money-savings is Number Needed to Treat/Number Needed to Screen – i.e. how many people you need to treat/test to prevent something bad. In most cases the number is very high. So while intuitively taking a preventive drug for one person may be cheaper than treating a condition, having hundreds people take the same drug for many years isn’t necessarily cheaper than preventing a condition in one person. Same applies to testing, but when you test, you need to factor in false positives as well.
Additionally, a lot of times during annual checkups doctors order unnecessary and non-recommended tests: http://www.ncbi.nlm.nih.gov/pubmed/16704947 . It seems so obvious – let us tests for everything or what is the harm in an EKG/urine test. But not only unnecessary tests cost money, they can result in harm. A test may seem harmless in itself, but in most cases it can have false positives. False positives not only cost money but they may lead to invasive tests that may have real risks. The total risk may be small, but so may be the probability you’d benefit. For example, if your risk of having some serious condition you are tested for is 1/1000000, 1/1000 risk of test doesn’t seem so small. But if your risk is 1/100 than you may be willing to take 1/1000 risk. But if a test isn’t recommended that normally means that there is no evidence at all that it has any benefit for a particular group e.g. healthy symptomless people. So you get almost 0 chance of benefit and a tiny risk. It is also expensive.
Even if you look at something that has been proven to save lives and is recommended, the cost savings aren’t there. Take for example mammograms. Intuitively it seems obvious that treating early cancer is cheaper than treating late stage cancer, right? Let’s look at the statistics. You need to screen 500 women in their 50s for 10 years to save one life and this is based on very optimistic view of the studies. Undoubtedly, if you are this one woman, than you benefit tremendously. But… The probability of having a false positive after one mammogram is 10% after first, less after each subsequent. But after 10 years of testing that translates into an almost 50% chance (estimate from NIH/PDQ website) of having at least one false positive. So about half of these 500 women will need at least one additional test. About a forth of false positives ends in biopsy, most of which would be negative. You may say, that you may save costs on more than 1/500 women by saving on treatment. Maybe. But there is also a little known issue called overdiagnosis – the detection of very early “cancers” that are either not growing or growing so slow that they wouldn’t spread in woman’s lifetime. The estimates of overdiagnosis vary from 5% to 30%. But as a result, there are more screened women who are diagnosed with breast cancer than non-screened women, so your total number of women you need to treat is higher. So while prevention in this case may save millions, the cost would be in billions (there have been studies to this effect, don’t have time to look for them). Just to avoid off-topic arguments: I am not arguing for- or against- mammograms, as I said, there is evidence that it saves lives. The subject here, however, is cost-savings, and I am simply giving an example of how what is intuitive isn’t necessarily true.
Or take statins for primary prevention in diabetics: http://care.diabetesjournals.org/cgi/content/full/26/6/1796 — read last line on conclusion. Keep in mind that when they say cost-effectiveness they mean that the cost of one quality-adjusted life year is under 50K; when they say cost-saving they mean actual savings.
Some preventiion may be cost-saving, but not all of it.
June 17th, 2008 at 10:18 am
It doesn’t surprise me but I would definately still want my yearly exam. I want whatever could be caught early to know about it as early as possible so that I may have the best chances of beating it. My Dad didn’t catch his colon cancer until he was 48 years old and it was stage 3. They felt at that point he had already had it five years. He lived 6 years after the initial diagnosis and fought the cancer two more times before dying of it.
June 17th, 2008 at 10:26 am
Usually insurance companies have the statistics for all kinds of information. I would bank on their analysis as being correct.
June 17th, 2008 at 12:19 pm
“Mo” Money – the article referenced in the blog was in a reputable journal. Medical studies in general are normally done by epidemiologists, not actuaries employed by insurance companies. The actuaries don’t have knowledge to understand the implications of, for example, testing healthy people. Actuaries don’t need to learn medical statistics. They can estimate amount of claims for certain conditions, but estimating how many people needs to be treated for how many years requires control studies – and this is what epidemiologists do.
There are also additional consideration for insurers. For example, one reason insurers like to know about problems early is that this way they can identify people who are likely to have problems. They may not do it if you get insurance from employer, but if you buy individual insurance, they may be very interested in how expensive you are likely to be for them in future.
So, it isn’t at all obvious that insurance companies’ pay for checkups because they have real data about cost-savings that a medical journal doesn’t.
June 17th, 2008 at 12:25 pm
Large-scale healthcare accounting has one implicit factor in it that complicates these discussions: the fact that saving someone’s life and letting them live longer is considered an “expense”. Preventing an illness or finding a condition that could kill you and getting it treated is often more expensive than missing it and dying before finding it in these calculations.
Also, if you die young, you don’t have expensive end-of-life care…
June 17th, 2008 at 1:51 pm
I hate statistical items. Even though it is based of of real life scenarios it is so unrellevent to you as an individual. Maybe the team of “experts” should quit taking the skewed results and charging us more than we need to pay.
June 17th, 2008 at 6:10 pm
I had to get a physical for work a few years ago. I work for a defense contractor and I was going to Kuwait for a couple months, so I had to get medical and dental certification, as well as a whole bunch of vaccinations. My doctor said that Blue Cross wouldn’t cover a physical unless I had some sort of physical ailment which might require a physical *wink, wink, nudge, nudge*. I said “Hmm, I don’t feel so good, nothing specific, I just don’t feel good.” He nodded, said “Mmmm Hmmm,” and gave me a physical, including blood work and an EKG. I only had to pay the $20 copay.
June 17th, 2008 at 7:35 pm
It seems to me that preventative medicine would not really save all that much. People still have to die of something. Therefore, you are just pushing off the time until the medical expenses will start to add up.
June 17th, 2008 at 11:07 pm
This is a little off topic, but more companies are introducing wellness programs along with preventative care – they know that employees who exercise and eat well will cost them much less in claims over the years than unhealthy workers.
Many firms with wellness programs offer rebates on health insurance premiums if participants go to annual in-house physicals where they check your blood pressure, weight, flexibilty, BMI, blood sugar and cholesterol. It’s a way for companies to play ‘big brother’ and anticipate/control health care costs.
June 20th, 2008 at 1:50 am
Wellness Proposals
http://www.wellnessproposals.com Wellness Proposals
June 20th, 2008 at 10:59 am
I am in the medical benefit end of insurance for years. Problems with the wellness dr. visits is that they “almost always find something wrong” and the definition of “healthy” has narrowed to the degree that no one fits into the “healthy” category. Once you are diagnosed with a “condition” no matter how minute and questionable rates increase, and should you need to come off group and get inividual coverage you could be denied or ridered. This topic is questionable even in our industry. Once you are diagnosed with a “condition”, even if temporary, it can stay on your medical record for years. Same with any drugs you take. Very tricky topic. A lot of insurance carriers now give rewards of airline tickets etc for wellness care. Then if they discover you have a “condition” from the wellness visit up goes the rates. However the other view is that wellness visits can discover health issues. Toss up in our industry. Question in our industry-do insurance carriers promote wellness visits to discover things to increase rates or do they really care about staying healthy?