You appear to be browsing this site using Internet Explorer 6. This browser is now out of date. For safer, more reliable browsing it is recommended that you upgrade your browser to Firefox, Safari or Internet Explorer 7 or 8.

Link to the Home page

Printer Friendly

  • link to increase text size
  • link to increase text size
  • link to increase text size

The United States of Diabetes
Challenges and opportunities in the decade ahead

  • The number of people diagnosed with pre-and full-blown diabetes is steadily and rapidly increasing – projected 28 million in the Medicare/Medicaid population by 2020.
  • The cost for managing prediabetes, diabetes and associated complications will reach upwards of $2 trillion by 2020.
  • UnitedHealthcare has targeted strategies in place that will significantly reduce the number of people who develop prediabetes as well as diabetes, which result save millions of dollars in health care cost.

Costs to Medicare and Medicaid

Medicare enrollees, including dual-eligibles, make up almost half of the total adult population with both diagnosed and undiagnosed type 2 diabetes. In 2010, Medicare covered almost 13 million people with diabetes, and 18 million more with prediabetes. By 2020, the number of Medicare beneficiaries with full-blown diabetes is expected to reach 21 million.

Medicaid also plays a role in coverage of adults with diabetes, particularly through its support for older people with disabilities and dual-eligible populations. Diabetes is often difficult for state programs to manage because of high turnover in the Medicaid population and the resulting challenges with screening and follow-up. Today, Medicaid covers about 4 million people with diabetes. By 2020, Medicaid is expected to cover 7 million people with diabetes, about two-thirds of whom will be dual-eligibles.

Over the 10-year period between 2011 and 2020, spending on Medicare beneficiaries with diabetes and prediabetes (including for dual-eligibles) is estimated to be about $2 trillion. Of that total, $1.7 trillion will be paid by the federal government. Beneficiaries—or the states in which they live (on behalf of dual-eligibles)—will pay the balance in the form of premiums, cost sharing, or for services not covered by Medicare. During this same 10-year period, we estimate that Medicaid's combined spending for dual- and non-dual-eligibles with diabetes or prediabetes will be almost $228 billion. The federal government will cover $145 billion with the states covering the balance of $83 billion.

The good news
To date, the primary focus of treatment for diabetes has been on medical management of the complications of the disease. The good news is that there are multiple opportunities to intervene and either prevent or control the disease. The costs and health risks associated with diabetes can largely be averted with targeted actions for prevention and compliance. Effective early intervention in the disease lifecycle can also have a material effect on the costs associated with prediabetes and diabetes.

UnitedHealth Group has identified specific strategies and tactical solutions to not just slow but actually reverse the escalating diabetes epidemic. In fact, we estimate that implementing these initiatives on a broad scale could potentially result in a 10 percent reduction in the incidence of prediabetes, and a further 8 percent reduction in the prevalence of full-blown diabetes, as well as other significant health benefits, by the end of this decade. In human terms, it would mean that almost 10 million people would never develop prediabetes, and among individuals who are diagnosed with prediabetes, 3 million would avoid deteriorating any further and avoid diabetes.

Our conclusions are founded on evidence-based, practical solutions derived from scientific research, pilot programs, and our own experience serving employer-sponsored consumers, seniors and people with health benefits through the public sector.

People with diabetes typically visit the doctor more often, experience longer and more frequent hospital stays, and use more prescription drugs. UnitedHealth Group's latest cost data, based on a sample of 10 million commercial health plan members in 2009, shows that the cost of care for patients with diabetes was approximately $11,700 compared to $4,400 for the remainder of the population. In addition, the average yearly cost of care for diabetes patients with complications is almost three times as high as for diabetes patients who do not have complications.

Of the nearly 27 million adults suffering from diabetes today, type 2 accounts for more than 95 percent of all diagnosed cases. A further 67 million people are currently estimated to have prediabetes.* The prevalence of type 2 diabetes has tripled since the 1980s. And, according to new research from the Centers for Disease Control and Prevention (CDC), the prevalence of diagnosed and undiagnosed diabetes will rise from approximately one in 10 adults today to between one in five and one in three adults by the middle of this century.

But there is nothing inevitable about this trend. In fact, the vast majority of the health risks and the health care costs associated with type 2 diabetes are avoidable. There is now a sufficiently large evidence base to show that effective interventions can make a difference. UnitedHealth Group is aggressively pursuing multiple initiatives to provide more effective diabetes care, reduce costs and improve patient outcomes through every stage of the disease.

Early detection is the first step
Unlike type 1 diabetes, which typically results in acute symptoms and is generally diagnosed shortly after its onset, prediabetes and type 2 diabetes often go undetected for many years. As a result, 90 percent of people with prediabetes, and about a quarter of those with diabetes, are unaware of their condition. Early detection and effective intervention is critical to control the progression of diabetes—and its associated health care costs.

UnitedHealth Group's OptumInsight has developed an analytic model that uses claims data, demographic information and other databases to identify individuals who are most likely to have undiagnosed needs. With an accuracy rate of higher than 80 percent, this tool helps facilitate targeted outreach to those most at risk and creates the opportunity for effective intervention to help manage or, better yet, reverse their condition.

Obesity and aging are primary factors contributing to prediabetes and diabetes. Gaining just 11 to 16 pounds doubles the risk of type 2 diabetes, and an increase of 17 to 24 pounds nearly triples this risk. Conversely, losing weight can be a big help. The results of the Diabetes Prevention Program (DPP), published in 2002, showed that intensive lifestyle intervention could stop prediabetes from progressing into type 2 diabetes in 58 percent of cases, when individuals lost just 5 percent of their body weight and exercised.

The only drawback to the DPP model was the price. Due to intensive, one-on-one counseling with clinical personnel and nutritionists, it averaged about $2,700 per participant over three years, and this high cost initially complicated efforts to scale up the DPP program.

Embracing our role as an activator of new models of prevention and care, UnitedHealth Group is currently collaborating with the CDC and the YMCA to translate and deliver the DPP program in a group setting. Nearly 60 percent of the U.S. population lives within three miles of a Y, so it's convenient for participants. By leveraging a national network of community-based lifestyle coaches, we expect to achieve similar results as the original DPP study, but at a cost of less than $400 per person over a two-year period.

Helping patients improve their compliance
Full-blown diabetes manifests itself in the form of high glucose, blood pressure and cholesterol levels. While it is often possible to control the disease using a combination of diet, exercise and oral medications, no treatment regimen or medication will work without good patient compliance.

Patient self-management is a cornerstone of treatment for diabetes. However, a low proportion of patients succeed in meeting goals for controlling blood glucose, blood pressure and cholesterol on their own. UnitedHealth Group's OptumHealth operates a diabetes disease management program for public and private payers. As part of the program, nurses call diabetes patients regularly to provide ongoing coaching and support, which helps patients better manage their condition and prevent the disease from progressing to advanced levels. This extra assistance is credited for reducing inpatient days by about 6 percent, and reducing inappropriate emergency room visits by about 13 percent, among participants in the program between 2007 and 2009.

UnitedHealth Group is also exploring value-based insurance designs (VBID), which leverage incentives such as reducing or eliminating co-pays and other behavioral "nudges" to improve patient compliance. In the first-ever commercial VBID design focused solely on diabetes, our Diabetes Health Plan™ (DHP) provides enhanced benefits to members with prediabetes and diabetes, in exchange for meeting multiple care compliance goals, including medication, lab services, professional services and preventive screenings.

Early results show a 70 percent increase in compliance with guidelines for diabetes management among participating members, accompanied by significant reductions in blood sugar and cholesterol counts. Enrollees also filled their prescriptions for treating diabetes-related conditions, including hyperlipidemia and hypertension, at a greater rate after DHP enrollment than during the prior year.

The role of community-based care providers
In the Asheville Project, pharmacists were called on to provide private, face-to-face diabetes consultation and coaching to help patients adhere to the treatment plan prescribed by their primary care physician. More than 50 percent of participants showed improvement, and annual net cost savings for employers and participants ranged from $1,622 to $3,357.

UnitedHealth Group analyzed the Asheville Project and the Diabetes Ten City Challenge (a larger pilot study that produced similar results) to determine how the model might be effectively replicated on a national level. In 2010, UnitedHealth Group launched the Diabetes Control Program (DCP), which is the first scalable health service program to deliver ongoing education and proven clinical intervention to diabetes patients using a broad network of well-trained provider pharmacists. As such, the DCP is a prime example of how non-physician providers like pharmacists can help provide continuous, valuable support for people with diabetes, through behavioral intervention, risk factor reduction, and detection for early signs of complications.

Improving care by reducing complications
Patients with diabetes are at increased risk for cardiovascular complications that include heart attack, chronic angina, stroke and peripheral vascular disease. In addition, they are at increased risk for vision loss, painful nerve damage in the limbs and kidney failure.

The Look AHEAD trial is studying the benefits of intensive lifestyle intervention in reducing cardiovascular disease among overweight or obese patients with type 2 diabetes. The study will conclude in 2014, after following some participants for as long as 13.5 years.

Early results show that the program produced greater weight loss, increases in fitness, and improvements in all cardiovascular risk factors, except LDL-C level. It produced positive changes in glucose control, systolic blood pressure, HDL (good) cholesterol and triglycerides (blood fats). In addition, participants lowered their glucose and blood pressure levels, reducing their need for medication and insulin.

The advantages of payment reform
UnitedHealth Group is also evaluating the benefits of shifting physician reimbursement from a pure fee-for-service model to an outcomes-based value model, with incentives to drive better coordination and management of chronic conditions, including diabetes. We are currently piloting a number of primary care medical home models across the country in partnership with physicians who are accountable for the quality and appropriateness of their patients' care.

Diabetes patients with complications are often candidates for so-called "case management," because they are at a high risk for additional adverse physical outcomes and high utilization of health care services. For example, uncontrolled diabetes is the number one cause of kidney failure in the United States. Transplantation is a costly procedure for government payers and employers, and quality and efficiency vary substantially across hospitals. UnitedHealth Group's Kidney Resource Service is a transplant program that provides incentives for the use of high-quality surgical procedures with demonstrated superior outcomes and efficiency.

Similarly, there is mounting evidence that bariatric surgery is a viable treatment alternative for some patients with diabetes and severe obesity. UnitedHealth Group has developed a bariatric surgery program (BRS) to help patients assess how to pursue this course of treatment considering the clinical and economic variability in surgical outcomes. Our data suggest that choosing a proven center of excellence can save an average $2,377 per procedure on initial costs, and an additional $932 per complication.

The magnitude of the opportunity
There are four core strategies that we believe could drastically reduce both the number of cases and the astronomical heath care costs associated with diabetes. Specifically, these are: (1) reducing and reversing the incidence of prediabetes in at-risk populations; (2) lowering the number of people with prediabetes who progress into full-blown diabetes; (3) improving patient outcomes by improving compliance with treatment and disease management protocols; and (4) leveraging intensive lifestyle interventions to reduce risks for diabetes complications.

Assuming that the success of initiatives like those previously described could be replicated nationally and across all affected populations, our simulation models suggest that the total potential savings in health care costs could be as much as $250 billion over the next 10 years net of projected intervention costs (which is about 7.5 percent of estimated spending on diabetes and prediabetes). Of those savings, we estimate that $144 billion, or about 58 percent, might accrue to the federal government through savings in Medicare, Medicaid, and exchange subsidies. In addition, employers could see improvements in workforce productivity, and employees could see increased wages, together worth an estimated $239 billion over 10 years.

In summary, there is now an important emerging evidence base about interventions that can reduce the risk of diabetes and its complications. Applying them broadly has the potential not only to save lives and improve health but also to significantly reduce the costs of diabetes-related care.

NOTE: This article was compiled using excerpts from The United States of Diabetes: Challenges and opportunities in the decade ahead, Working Paper 5, first published in November 2010. For a comprehensive analysis of the issues, potential strategies and the projected resulting cost savings, and details on the methodology on which we base our conclusions, please read the complete report.

* For specific sources for all the statistics referenced in this article, please refer to Working Paper 5.

Download Working Paper 5 on Diabetes (PDF 857.25 KB)