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REDUCING COSTS BY EXPANDING COVERAGE (02/03/2010)
IMPROVING CARE AND REDUCING COSTS BY EXPANDING COVERAGE Harvard Medical School researchers led by J. Michael McWilliams, M.D., Ph.D

A major focus of the health reform debate in Congress is the cost of covering uninsured Americans -and how to pay for it. However, this study released online by the Annals of Internal Medicine demonstrates that expanding health coverage might not cost as much as policymakers assume. It was found that individuals who were uninsured before becoming eligible for Medicare at 65 had significantly higher spending than did those with coverage prior to Medicare enrollment. On average, those who were previously uninsured cost Medicare an additional $1,000 annually per person when compared with those who had been consistently covered. Increased costs were incurred primarily from delaying costly elective procedures and from deficient care and complications resulting from cardiovascular disease and diabetes.

The authors estimated that providing coverage to adults ages 51 to 64 would cost $197 BIL. However, this increased coverage would reduce subsequent Medicare spending (for adults ages 65 to 74) by about $98 BIL -offsetting almost half of the original costs. "These findings point to the urgent need to act on comprehensive health reform to ensure secure and stable coverage for all Americans, and slow the rise in health care costs for employers, families, and government," said Commonwealth Fund president Karen Davis.

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