Health Care Spending Effectiveness: Estimates Suggest That Spending Improved US Health From 1996 To 2016.

Area of Science:

• Health economics
• Public health
• Biostatistics

Background:

• Healthcare spending effectiveness measures the value of increased spending against improved health outcomes.
• Understanding US healthcare spending efficiency is crucial for resource allocation and policy decisions.

Purpose of the Study:

• To report US healthcare spending-effectiveness ratios.
• To analyze trends in spending per case and disability-adjusted life-years (DALYs) averted over time.
• To calculate an outcome-adjusted healthcare price index.

Main Methods:

• Utilized data from the Disease Expenditure Project for healthcare spending and the Global Burden of Disease Study 2017 for DALYs.
• Employed decomposition analysis to estimate changes in spending and DALYs per case, controlling for population and disease factors.
• Calculated an outcome-adjusted healthcare price index using assigned dollar values for DALYs averted.

Main Results:

• Median healthcare spending was $114,339 per DALY averted across all causes between 1996 and 2016.
• Twelve of thirty-four high-spending or high-burden causes had median spending below $100,000 per DALY averted.
• An outcome-adjusted price index showed relative price increases of 4% (at $100k/DALY) or decreases of 13% (at $150k/DALY), suggesting health improvements offset spending growth.

Conclusions:

• US healthcare spending has, on average, generated significant health improvements relative to its cost.
• A substantial portion of healthcare spending growth has been invested in improving population health outcomes.
• The value assigned to DALYs averted influences the interpretation of healthcare price trends.