Congress must address how Medicare handles chronic illnesses

Top of Capitol building in District of Columbia

Chronic illnesses are devastating America's health and its pocketbooks, but Congress appears reluctant to take any decisive action, according to Robert E. Moffit, Ph.D., a senior fellow at Heritage Foundation's Center for Health Policy Studies in a piece for The Hill.

Despite the fact that chronic illness may account for as much as 93 percent of all Medicare spending, Moffit noted that the program still does not cover devices to help control such conditions, such as continuous glucose monitors for diabetics. Yet diabetes care results in at least $176 billion a year in direct medical costs.

Chronic illnesses are indeed a bane of U.S. healthcare delivery. Although many sufferers can control their conditions with the proper medication and monitoring, many have seen their illnesses spiral out of control. A 2013 study concluded that the majority of frequent visitors to hospital emergency departments are suffering from some form of chronic illness. And among inpatients with chronic conditions, readmission rates tend to be higher, driving up costs further still.

“Traditional, fee-for-service Medicare remains inflexible, with bureaucratic benefit setting and its complex administrative pricing and price controls,” Moffit wrote.

He did note that a bill floating through Congress would allow new Medicare plans and provider groups to “focus on integrated care for the chronically ill.” The bill proposes financing on a per capita basis, with adjustments made for the Medicare enrollee's health risk profile and income.

At the same time, Moffit evinced a skepticism around accountable care organizations that engaged in Medicare risk-sharing, a byproduct of the Affordable Care Act. He noted that 72 percent of the ACOs participating in the shared savings programs did not generate enough savings to obtain a bonus.

Although few providers actually qualified for a bonus, ACOs did save the Medicare program $411 million in 2014.