Research Paper PBHE315

Impact of Diabetes on Healthcare costs

Outline

Andrew Clark

PBHE315

October 21, 2018

Impact of Diabetes on Healthcare costs

Introduction

Diabetes is a major challenge that people all over the world are facing today and the cost of managing the disease in the United States has been increasing every year. The total cost of diagnosed diabetes was estimated at $245 billion in 2012 by the American Diabetes Association and within a period of five years, this figure has increased by 26 per cent to reach $327 billion in the year 2017. This shows how the cost of managing this disease has been a major burden to the economy. I believe that health care economic principles can be applied in the analysis of the costs associated with this disease to ensure that the possibility of coming up with ways of cutting down the expenses or using the resources more economically is determined. The purpose of this paper is to review the cost of diagnosed diabetes in the United States with a view of recommending ways of using the resources available more economically to achieve more efficiency or cutting down non-essential expenses and channelling the funds to more demanding issues concerning managing the disease.

Overview of impact diabetes on healthcare costs

The cost of diagnosed diabetes represents the financial load, healthcare resources required and the productivity that is lost due to the disease. The amount of resources that are channelled to the management of the disease have become an issue of concern because even with all the efforts that are being made, we still continue to witness increased numbers of diabetes cases. Hospital inpatient care and medication prescriptions each take 30 per cent of the medical expenditure (Powers et., 2017). Anti-diabetic agents and supplies both take up 15 per cent while a visit to the physician office takes approximately 13 per cent. According to the American Diabetes Association, 2017, people with diabetes incur medical expenses which are 2.3 time those of people without diabetes.

Why the issue is of concern from a health care economics perspective

Heath care economics is concerned with efficiency, value and behaviour that surrounds the production and use of health and health care. Health care economists apply economic health care principles in studying how health care systems can be designed to function effectively and how resources can be used to achieve more value. Looking at the huge resources that are budgeted for managing diabetes, it becomes important to determine whether certain expenses can be cut down or resources used better to ensure more value for money (Jönsson, 2002). The cost has increased by 26 per cent in the last 5 years and there is need to determine the reason for the rise despite the efforts put to contain the disease.

Major parties involved in this issue

· The federal government

· State governments

· America Diabetes Association

· Health care facilities and insurance

· People diagnosed with diabetes

Market forces with an impact on cost of healthcare impacted by diabetes

· Number of consumers and patients with diabetes related issues: influence demand

· Economy and finance: Operating costs for non-profits treating diabetes as well as revenue constraints

· Hospital price for treating diabetes

· Insurance and coverage

· Availability for physicians: influence supply

· Political issues affecting ease of doing business

Demand

With demand of health care services for people with diabetes increasing every year due to the increased number of patients, this trend also impacts the cost of services because health care providers and entrepreneurs would want to utilize this opportunity to get more profit.

Supply

The number of health care professionals handling different issues related to diabetes as specialists in limited. This means that there is a deficit in supply of labour and therefore this factor drives the cost of the same up.

Affordable care Act

The Affordable care Act has bene instrumental in containing diabetes with its greatest success being the partial financing of diabetes treatment and creation of awareness. However, a lot review must be done to determine the possibility of the redesigning the program to make it more effective in handling the diabetes issue.

Health disparities

The cost of treating diabetes for those who have been diagnosed with is very high. For instance, as ta 2017 March, diabetes patients spent a total of $ 16,752 per year in medical bills and $9601 of this amount goes to the management of diabetes related issues (America Diabetes Association, 2017). This is not an amount of money that the poor can afford and therefore it becomes entirely hard for them to acquire proper treatment (Adepoju, Preston, & Gonzales, 2015). This represents a major disparity depending on class of people.

Diabetes costs in other global markets

Countries in the developed world also face the same trouble on managing diabetes. Countries like China and others in Europe have same challenges in managing diabetes (Bommer et al., 2017). Some countries that have a comprehensive health care coverage for entire country feel the pinch of the disease on the economy.

Recommendation

The cost of managing diabetes is a major concern for the country and its high time that we get to review the functioning of the programs designed to handle the issue. Major factors that should be reviewed include, whether we are getting value for money invested in manging the issue, possibility of cutting down on non-essential programs, improving on efficiency and redesigning some services to cost less.

Conclusion

The cost of diagnosed diabetes in the United States is considerably high and the programs put in place are costing more very year. Through redesigning of certain services and programs, the cost can be managed. Through a proper review non-essential services can be scrapped and others merged to ensure that proper the system becomes more effective.

References

Adepoju, O. E., Preston, M. A., & Gonzales, G. (2015). Health care disparities

in the post–Affordable Care Act era. American journal of public

health, 105(S5), S665-S667.

Bommer, C., Heesemann, E., Sagalova, V., Manne-Goehler, J., Atun, R.,

Bärnighausen, T., & Vollmer, S. (2017). The global economic burden of

diabetes in adults aged 20–79 years: a cost-of-illness study. The lancet

Diabetes & endocrinology, 5(6), 423-430.

Jönsson, B. (2002). Revealing the cost of Type II diabetes in Europe.

Diabetologia, 45(1), S5-S12.

Powers, M. A., Bardsley, J., Cypress, M., Duker, P., Funnell, M. M., Fischl, A.

H., ... & Vivian, E. (2017). Diabetes self-management education and

support in type 2 diabetes: a joint position statement of the American

Diabetes Association, the American Association of Diabetes Educators,

and the Academy of Nutrition and Dietetics. The Diabetes Educator,

43(1), 40-53.

World Health Organization. (2016). Global report on diabetes. World Health Organization.