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California
Focus on Diabetes:
Excess Costs Associated with Diabetes for State Government Employees
2004 Estimated Share of Health Expenditures on State Government Employees That Relates to Diabetes Care, Compared to the Pacific States and All States
HbA1c is a marker of blood glucose levels and is used as an indicator of the quality of diabetes care. Diabetes quality improvement programs have produced reductions in HbA1c on average of 0.5% across a population of participants. The best results, reductions of 1%, occur when intensive disease management programs coordinate assessment, treatment, and referral with primary care.
Average Results
If California's employees' and dependents' HbA1c levels were reduced by 0.5%, then spending on diabetes care of State government employees might be reduced by about $3,600,000 per year.
Best Results
If California's employee's and dependents' HbA1c levels were reduced by 1.0%, then spending on diabetes care of State government employees might be reduced by about $8,200,000 per year.
Note—These savings:
- May not be realized for years.
- Do not include the cost of quality improvement programs that would be needed to achieve a 0.5% or 1.0% reduction, respectively. Depending on intensity, a diabetes disease management program costs between $20 and $60 per participant per month.
- Are most likely for a State that has not yet instituted a quality improvement or disease management program for its State government employees.
- Include only medical costs and exclude gains from lower absenteeism and higher productivity from fewer illness episodes related to diabetes.
Other things to consider:
- While a quality improvement or disease management program should reduce the use of the most expensive services (e.g., emergency rooms and inpatient stays), doctor visits and prescription drug costs would probably increase. The calculation above does account for such changes.
- Serious consequences of diabetes—risk of heart attack, stroke, and amputations—can be reduced with excellent blood glucose control. The calculation above may not fully account for long-term savings associated with avoiding these serious complications.
- States with higher rates of emergency room use and inpatient stays are more likely to reduce diabetes care costs with a quality improvement or disease management program. Other factors to consider include patient education on how to maintain blood glucose control, patient adherence, and access to care.
- Quality improvement programs should be designed to deal with all problems associated with diabetes (including potential heart attack and stroke):
- Test and control HbA1c levels
- Conduct physical exams for retina and feet
- Test and control blood pressure
- Test and control cholesterol
- Vaccinate for influenza
- For more information on diabetes quality of care and how States can establish and lead a quality improvement program on diabetes care State-wide, go to Diabetes Care Quality Improvement: A Resource Guide for State Action
Methods—The calculations above are based on:
- A review of the clinical literature demonstrating the effects of diabetes quality improvement programs on average HbA1c levels (Shojania et al., 2004).
- A review of health services research showing that lower HbA1c levels are associated with lower costs of diabetes care (Gilmer et al., 2005).
- A calculator developed for AHRQ that incorporates those potential outcomes, possible cost savings, national HbA1c levels, and characteristics of California's government employees (select Methods on the left menu for information on the calculator).
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