Chronic care costs in managed care

Abstract

This DataWatch presents estimates of the health care costs for all adults who were continuously enrolled in a large staff-model health maintenance organization (HMO) during 1992. More than one-third of these adults were diagnosed with at least one chronic condition in 1992, and costs for this population are at least twice those of the population without chronic conditions. A diagnosis of a chronic condition results in an expected increase in costs of 80 percent-300 percent, depending on age, sex, and chronic condition profile. Previous studies of the costs of chronic illness have focused on the fee-for-service sector. As managed care continues to grow, it is important that economic analyses focus on this market segment.