The Boomers Are Coming: A Total Cost of Care Model of The Impact of Population Aging on The Cost of Chronic Conditions in The United States

Abstract

The purpose of this study is to estimate the impact of population aging on medical costs over the next five decades in the United States. Specifically, we focus on the impact of aging on the chronic and/or expensive conditions most often included in disease management programs: coronary artery disease (CAD), congestive heart failure (CHF), diabetes, asthma, pregnancy, psychiatry, and chemical dependency. We apply estimated age-, gender-, and condition-specific annualized costs to the projected US population in each age and gender group for future years, through 2050, to provide an estimate of future healthcare costs. The primary data sources are pooled claims and membership for 2002 and 2003 for HealthPartners, a large midwestern health plan. Secondary sources are US annualized medical costs for 2003 and US Census Bureau demographic projections for the next five decades. Using the Episodes Treatment Group (ETG) grouper from Symmetry, we grouped HealthPartners data into 574 clinically meaningful episodes of care units. We then aggregate selected ETGs into the conditions reported in this study. Using data for all types of health services, we find that aging will have a greater impact on per capita costs for diseases where the ratio of costs for older versus younger ages is greater, such as CHF, CAD, and diabetes. In addition, we project that aging of the US population will actually reduce per capita costs for pregnancy and infertility, chemical dependency, and psychiatric conditions. Aging will have more of an impact on care for specific chronic diseases. These projections can inform health policy and planning as providers of health care, health plans, disease management vendors, and the government anticipate meeting future US healthcare needs.