Changes called for as 1% of population accounts for 1/3 of health care spending

Ontario’s Health and Long-term Care Minister is calling for a change in how health care costs are scrutinized in light of research showing that a tiny proportion of the Ontario population accounts for a very large proportion of health care expenditures.

“We need to shift our focus” away from line-by-line scrutiny of hospital, drug and long term care spending towards “what we spend on patients,” Deb Matthews, told HealthAchieve, the annual meeting of the Ontario Health Association, last month.

Such a focus will help provide better care, and better value for dollars spent, she said.

Of the province’s 13.7 million people, a mere 1% (about 137,000 people) accounted for 34% of Ontario health care expenditures in 2007, according to a report from the Institute for Clinical Evaluative Sciences (ICES), which tracked most major health care costs.

To “qualify” to be in the top 1% category, health care expendiitures for each person were at least $33,335 a year. Altogether, the 1% accounted for $7.8 billion of the total spending that year of $23 billion, according to the research.

At the other end of the spectrum, 50% of the Ontario population accounted for about 1% resources in 2007, representing spending of less than $181 per capita.

Such findings are not new or unique to Ontario. Manitoba research from more than a decade ago revealed the same trend, as has research from the United States, and the United Kingdom has been studying how to act on the information. But a spotlight is being directed to the issue because of the increasing emphasis on accountability and the sustainability of health care, as well as changing demographics and the aging of the Canadian population.

Who is in the 1%?

That the most ill people use the most health care resources is appropriate. But this information raises some important questions: who makes up the 1%, can their health care needs be better (and more cost effectively) managed, and if so, where should investments be made or reallocated?

The individuals who make up the 1% vary from year to year—some remain top users of health for a period of time, while some transition out of the category, notes Ken Lam, whose PhD thesis involved a close examination of Manitoba data.

The Ontario data reveal that about 25% of the highest cost patients remain in that category in the following year, according to health economist Walter Wodchis, who was lead author of the ICES report.

Among the high users are individuals at the end of their lives, people with chronic and sometimes multiple illnesses, accident/trauma survivors, and infants with high health care needs. Clearly, “one size does not fit all” when it comes to addressing the needs of this diverse group, notes Lam, who teaches at York University’s school of health policy and management.

“Skewed” use of health care resources exists for all ages, conditions

The ICES research indicates that the vast majority (~80%) of those in the top 1% category in Ontario are age 65 and older. But Lam stresses that although the elderly are often pointed to as high users, the unequal utilization of health care resources is a persistent feature for the elderly and for all other age groups. (Those who are over-65, and are in the top 1% category in Ontario, represent about only 6% of the over-65 age population.)

The “skewing” trend also persists among those with chronic conditions, such as diabetes or asthma, as only a small proportion of sufferers account for a large proportion of health care expenditure, according to research he co-authored.

The health care resource that is most “skewed” towards a small proportion of the population is in-hospital acute care; physician and prescription drug utilization are somewhat more evenly distributed among the population, according to Lam’s Manitoba research, which did not include long term care.

Ontario follows much the same pattern, but also shows that for those over 65 years in the top 1%, the vast majority of expenses are for acute care and long-term care, according to research by Wodchis and others.

Significant structural and funding changes are needed in order to better manage most of the top 1% patients, observers argue. “We’re good at acute care but not good at providing chronic care or home care.” says Jeff Turnbull, chief of staff at Ottawa Hospital and a former president of the Canadian Medical Association. “We need substantive change. Up to now, we’ve just been playing around the edges.”

Acute care is now “default” for chronic care management

The problem goes back to the fact that when medicare was established and public coverage was limited to hospital care, physician services, and in-hospital prescription drugs. Health care money is in dedicated “silos” and reallocation is challenging, Turnbull notes.

Still, a number of initiatives are underway to find ways to better manage and integrate care for high users.

For example Wodchis and colleagues, in a project being funded by the Ministry of Health and Long-term Care, are focusing on finding ways to better address the needs of those 65 years and older in the top 1% category, most of whom suffer from one or more chronic diseases.

Better coordination of care is needed to avoid situations where, for example, a patient with both heart failure and kidney failure may be told to take a lower dose of a diuretic (which reduces water in the body) by the endocrinologist and a higher dose by the cardiologist, Wodchis said in an interview.

One challenge with this approach will be to decide which patients qualify for more intensive case management, recognizing that others with similar care needs may benefit from this approach. For example, if the focus of the intervention is on the highest 1% of health care users, is it acceptable that the next 1% not receive the same services?

For his part, Turnbull argues that acute care in hospital is now a default for chronic care management in the current system. Instead, he would like to see much greater emphasis placed on teams of health care professionals providing care for people with chronic illnesses where they live.

The team-based primary care that Ontario has introduced should be built on, so that in addition to having patients come to them, the teams could be required to provide care in homes, in long-term care institutions and in shelters for the homeless, he said. The principle is to provide the most appropriate care in the most appropriate circumstances—when and where needed, Turnbull said.

The “assess and restore” approach to the elderly

Within Canada, Ontario has the highest rate of alternate levels of care —people waiting in hospital to return home, or be admitted to a retirement homes or long term care facility—according to a 2011 report by Dr. David Walker.

In the report, Walker argued that primary care providers must place a priority on care for the elderly, identify those at risk and actively manage their multiple challenges.

Walker called for an “assess and restore” approach to the frail elderly, aimed at restoring their level of functioning, instead of allowing them to languish in hospital (or elsewhere) while their condition deteriorates.

Along the same lines, long-term care facilities should “focus a portion of their capacity on cyclical, restorative, transitional and respite care programs, while maintaining permanent placement for those with more complex needs,” Walker’s report stated.

Too many of the 1% of high users, such as those with chronic illnesses and people at the end of life, “are forced into the not-useful existing paradigm” of acute care, Turnbull argues. This is an issue being explored by the Canadian Research Network for Care in the Community

Health Minister Matthews appears ready to take action by focusing on those who have high health care needs. In her address last month, she talked about the creation of health networks that will link all the health care providers in a given geographic area who are providing care to individuals with a focus on those using who utilize a high proportion of health resources.

These health link networks would work to ensure that there is one “most responsible provider” for each patient. How these networks would be created and implemented within the current system of healthcare delivery has yet to be elaborated.

For more coverage on this issue, see the Health Care Checkup in the Toronto Star.

The Ministry of Health and Long Term Care has announced the launch of 19 Health Links.