Can health promotion programs save Medicare money?

Ron Z Goetzel¹, David Shechter², Ronald J Ozminkowski¹, David C Stapleton³, Pauline J Lapin⁴, J Michael McGinnis⁵, Catherine R Gordon⁶, Lester Breslow⁷

¹Institute for Health and Productivity Studies, Cornell University, Washington, DC; ²Health and Productivity Research, Thomson Medstat, Santa Barbara, CA; ³Cornell Institute for Policy Research, Cornell University, Washington, DC; ⁴Office of Research, Development, and Information, Centers for Medicare and Medicaid Services, Baltimore, MD; ⁵National Academy of Sciences, Institute of Medicine, The National Academies, Washington, DC; ⁶Office of the Director, Centers for Disease Control and Prevention, Washington, DC; ⁷UCLA School of Public Health, Dept. of Health Services, Los Angeles, CA, USA

Abstract: The impact of an aging population on escalating US healthcare costs is influenced largely by the prevalence of chronic disease in this population. Consequently, preventing or postponing disease onset among the elderly has become a crucial public health issue. Fortunately, much of the total burden of disease is attributable to conditions that are preventable. In this paper, we address whether well-designed health promotion programs can prevent illness, reduce disability, and improve the quality of life. Furthermore, we assess evidence that these programs have the potential to reduce healthcare utilization and related expenditures for the Medicare program. We hypothesize that seniors who reduce their modifiable health risks can forestall disability, reduce healthcare utilization, and save Medicare money. We end with a discussion of a new Senior Risk Reduction Demonstration, which will be initiated by the Centers for Medicare and Medicaid Services in 2007, to test whether risk reduction programs developed in the private sector can achieve health improvements among seniors and a positive return on investment for the Medicare program.

Keywords: health promotion, return on investment, Medicare, financial impact, risk reduction programs, demonstration