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National healthcare expenditures are projected to equal $5 trillion by 2022 2.2 2.3 2.6 2.8 3.1 3.5 3.9 4.4 5.0 0 1 2 3 4 5 6 2006 2010 2014* 2018* 2022* US$ trillions Source: Centers for Medicare and Medicaid Services. * Projected.

National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

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Page 1: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

National healthcare expenditures are projected to equal

$5 trillion by 2022

2.2 2.3 2.6 2.8

3.1 3.5

3.9

4.4

5.0

0

1

2

3

4

5

6

2006 2010 2014* 2018* 2022*

US$ trillions

Source: Centers for Medicare and Medicaid Services. * Projected.

Page 2: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

2010 Total = US$ 887 billion 2020 Total = US$ 1.5 trillion

Arthritis $225

Asthma $55

Cancer $273

Cardio-vascular Disease

$611

Diabetes $244

Source: Centers for Disease Control and Prevention.

Spending on top 6 chronic diseases will grow over 70% by 2020

Arthritis $133

Asthma $34

Cancer $155

Cardio-vascular Disease

$351

Diabetes $141

Depression $72

Depression $118

Page 3: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

U.S. aging population is growing fast

12.5 12.7 12.4 12.4 13.1 14.8

16.8 18.8

20.3

0

5

10

15

20

25

1990 1995 2000 2005 2010 2015 2020 2025 2030

Percent 65+

Sources: U.S. Census Bureau, Moody’s Analytics.

Page 4: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Rising U.S. adult obesity rates

Source: Centers for Disease Control and Prevention.

13.3 14.6 15.1

23.3

31.1 34.1

35.7

0

10

20

30

40

1960-1962 1971-1974 1976-1980 1988-1994 1999-2002 2003-2006 2009-2012

Percent obese

Page 5: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Percent of current adult smokers has decreased dramatically Percent of adults that are current smokers in the U.S.

42.4

37.4 33.2

30.1

25.5 24.7 23.5 20.9 19.3

0

10

20

30

40

50

1965 1970 1980 1985 1990 1995 1999 2005 2010

Percent

Source: Centers for Disease Control and Prevention.

Page 6: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Breakdown of U.S. annual per capita health spending by

category of care

Pharmaceuticals and medical goods

Hospitals and nursing homes

Public health and administration

Ambulatory health care

Sources: OECD, PBS.

$2,852

$1,105

$3,097

$856

Page 7: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Total expenditure on health Percentage of the GDP in select OECD countries

17.7

11.6 11.3 11.2 9.5 9.4

7.4

0

4

8

12

16

20

United States France Germany Canada OECDAverage

UnitedKingdom

South Korea

Percent of GDP

Source: OECD.

Page 8: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Total expenditures on health Per capita in select OECD countries

8,508

4,522 4,495 4,118 3,469 3,406

2,199

0

2,000

4,000

6,000

8,000

10,000

UnitedStates

Canada Germany France OECDaverage

UnitedKingdom

South Korea

US$

Source: OECD.

Page 9: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

U.S. spends more for all categories of care Health spending per capita in select OECD countries

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

United States Canada Germany France

Hospitals/nursinghomes

Ambulatory healthcare

Pharmaceuticals andmedical goods

Public health andadministration

US$

Sources: OECD, PBS.

Page 10: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Where does the U.S. spend more than other countries?

Sources: OECD, PBS.

U.S. rank compared to other OECD countries U.S. OECD average

MRI units per million population

2 31.6 12.5

MRI exams per 1,000population

2 97.7 46.3

Tonsillectomy per 100,000 population

1 254.4 130.1

Coronary bypass per 100,000 population

3 79.0 47.3

Knee replacements per 100,000 population

1 226.0 121.6

Caesarean sections per 100 live births

6 32.9 26.1

Page 11: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

U.S. chronic disease management needs improvement Asthma hospital admissions per 100,000 people in select OECD countries

15.7 30.8

43.4 51.8

73.7

120.6

0

40

80

120

160

Canada Germany France OECD average UnitedKingdom

United States

Number per 100,000 people

Sources: OECD, PBS.

Page 12: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

U.S. tops the OECD in percent of overweight adults Percent of overweight or obese adults in select OECD countries

56.1

42.9

42.9

41.6

36.1

17.0

0 20 40 60 80

Source: OECD.

70.3

60.1

58.1

54.7

49.9

29.4

020406080

South Korea

France

OECD average

Canada

Germany

United States

Males Females

Percent Percent

Page 13: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Over one third of U.S. children are overweight Percent of overweight or obese children in select OECD countries

35.9

26.6

26.1

21.4

17.6

14.9

0 10 20 30 40

Sources: OECD, PBS, International Association for the Study of Obesity.

35.0

22.7

28.9

22.9

22.6

13.1

010203040

France

Germany

OECD average

Canada

United Kingdom

United States

Males Females

Percent Percent

Page 14: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Healthcare projected to represent a third of job growth by 2022 New jobs in 1,000s

0 100 200 300 400 500 600

Personal care aides

Home health aides

Medical secretaries

Physical therapists

Health specialties teachers

Dental hygienists

Registered nurse practitioners

Physician assistants

Physical therapy assistants

Behavioral counselors

Count, thousands

Source: Bureau of Labor Statistics.

Page 15: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Growth of patient-centered medical homes Number of recognized sites and clinicians in thousands

0

5

10

15

20

25

30

2008 2009 2010 2011 2012 2013

Clinicians

Sites

Count, thousands

Source: National Committee for Quality Assurance.

Page 16: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Increasing prevalence of accountable care organizations (ACOs) By sponsor type

0

100

200

300

400

500

600

700

2012, Q2 2012, Q3 2012, Q4 2013, Q1 2013, Q2 2013, Q3 2013, Q4

Other

Insurer

Hospitalsystem

Physiciangroup

Count

Source: Health Affairs.

Page 17: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Greater access to care with connected health and telemedicine

Telemonitoring (weight, BP, heart rate, pulse oximetry)

Time- and place-independent access to specialty physicians

eReferral to reduce wait times for specialties

Tele-ICU intensivist coverage over more intensive care unit beds

Greater medication regime adherence

Source: Health Affairs.

Page 18: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Free smartphone apps for medication adherence

Source: Tennessean.

App Feature(s)

Care4Today Monitor medication use of loved ones. Donate to charity when taken on time.

Med Helper Export results to doctors, nurses and caregivers.

MedCoach Connect to your pharmacy to order refills.

MediSafe Supports English and non-English languages.

Pill Monitor

Email a log of prescriptions taken.

Pill Reminder

Set up accounts for multiple family members through www.drugs.com.

RxmindMe Export prescription information through Walgreens.

Page 19: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Healthcare providers in the future

Projected physician shortage:

2012: 950k practicing physicians

2020: 90k more providers needed

(1/2 primary care)

2025: 130k more providers needed

(1/2 primary care)

Source: Health Affairs.

Page 20: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Medicare and Medicaid projected to cost $1.2 trillion less than

under earlier projections

Page 21: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

When the cost curve bent

Source: New England Journal of Medicine.

Page 22: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Average annual difference between growth in real GDP per capita and

growth in real health expenditures per capita, 1965-2012

3.1 3.1

2.1

3.6

2.8 3.1

0.0

3.2

2.2

0.0 0.0

1.0

2.0

3.0

4.0

1965 -1969

1970 -1974

1975 -1979

1980 -1984

1985 -1989

1990 -1994

1995 -1999

2000 -2004

2005 -2009

2010 -2012

Percentage points

WOO-

HOO!!

Whoops…

Source: Bureau of Economic Analysis, National Income and Product Accounts, Centers for Medicare and Medicaid Services, National Health Expenditure Accounts, CEA calculations.

Note: Health expenditures per capita are deflated by the GDP price index

Page 23: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Acute care hospital readmission rates 2007-2012

Source: Center for Medicare and Medicaid Services, Office of Enterprise Management.

Page 24: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

What’s “hot”

Page 25: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Who is paying?

PROVIDER PAYER PHARMA EMPLOYER CONSUMER

Solutions must be compelling enough for stakeholders to buy on recurring basis -Consumers are not conditioned to pay for healthcare solutions

Page 26: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Process innovation is a key change agent

$765 billion annually wasted in the healthcare system --Technology-enabled solutions and outsourced services are key enablers

Source: OECD, Institute of Medicine.

Page 27: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

Skyrocketing cost of cancer drugs

Source: Peter Bach, MD, Memorial Sloan Kettering Cancer Center .

Page 29: National healthcare expenditures are projected to equal $5 ... · Health spending per capita in select OECD countries 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 United States

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