Asthma's Up, Yes, But Are Distorted Financial Incentives Still Driving Care?

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The CDC reports that nearly 25 million Americans, or 1 in 12, now suffer from asthma. That's a prevalence rate of 8.2 percent in 2009, up slightly from 7.7 percent in 2005. Asthma rates tend to be higher among certain groups: women, children, blacks, the poor and people who live in the Northeast and Midwest. (A report last year found that New England asthma rates are highest in the country.)

But according to David Link, Chief of Pediatrics and head of the pediatric asthma program at Cambridge Health Alliance, higher asthma rates are a non-story. "Asthma is steadily rising in every developed country and has been for years, ho hum," he says. "The real story is, what the hell is wrong with us, the medical community, why don't we do what we can do to prevent this? We can't make the asthma go away, but we can make the unscheduled visits to ER and admissions to the hospital go away."

Dr. Link has written previously about the distorted financial incentives driving asthma care. He says the ubiquitous respiratory illness is generally a big profit generator at hospitals, which makes promoting prevention very tricky. But what may be costly for a specific hospital, he says, would generate huge savings to society.

"Step into any pediatric ward in the region and you will find that asthma-related treatment is most likely their number one cause of admission and source of revenue," Dr. Link writes. "Because of these powerful financial incentives, it has been difficult to reduce asthma related admissions and emergency visits in favor of prevention. In fact, there are significant additional resources required for prevention and better disease management which are not reimbursed, hence the failure to obtain any serious traction here."

CDC: Asthma cases are up since 2005
CDC: Asthma cases are up since 2005

Here's Dr. Link's piece on the skewed incentives behind treating asthma, written in May, with Cambridge Health Alliance CEO Dennis Keefe:


Organizing care this way – according to established guidelines and communicating among all providers and community resources – is not cheap. And our current payment system simply does not recognize these costs. There’s no reimbursement model for outreach, non-traditional encounters, telephone counseling and other simple methods of preventive medicine. That’s why it is important that prevention be a centerpiece of the health care payment reforms now being developed by the state and federal governments.

Even then, it may be a challenge to demonstrate how preventive efforts can save us money and how to incent institutions toward a prevention model. We know from our own experience that a $250,000 estimated annual investment saves payers – Medicare, Medicaid and private insurers – an estimated $800,000 every year in ED visits and inpatient costs. Payment reform must build in methods to share those savings with providers, or at least recognize and pay for the cost of the necessary prevention systems.

Without support from the insurance industry, governments and private foundations, there’s no way to convince a hospital administrator that severely reducing the volume of asthma patients that visit each year will be good for the bottom line.

Currently, there is a Medicaid Global Payment Demonstration Project for asthma included in the House budget. If we’re really interested in seeing declines in this terrible disorder, it should win unanimous support.

Note: Dr. Link says this asthma global payment demonstration project is now pretty much off the table but he's working on a related national pilot project. Stay Tuned.

This program aired on January 13, 2011. The audio for this program is not available.

Rachel Zimmerman Twitter Health Reporter
Rachel Zimmerman previously reported on health and the intersection of health and business for Bostonomix.




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