The Cost of Health Care

INCREASING COSTS

Americans want a quality health-care system despite its increasingly high cost. Table 9.1 shows the progression of medical costs in the United States from 1960 to 2006. The table compares the growth in national healthcare expenditures and in gross domestic product (GDP; the total value of all the goods and services produced by a nation in a given year) over those years, and presents the national health expenditures as a percentage of the GDP.

In 1960 the United States spent 5.2% of its GDP on health care. (See Table 9.1.) In 1970 this percentage had risen to 7.2%, and by 1980 it had risen to 9.1%. The rise continued, and by 1990 health care consumed 12.3% of the GDP. Growth of the cost of health care slowed somewhat during the 1990s, so that by 2000 heath care was 13.8% of the nation's GDP. Since 2000, health-care costs have continued their upward climb at a significant pace. In 2006 health-care costs consumed 16% of the GDP.

The Consumer Price Index (CPI) is a measure of the average change in prices paid by consumers. For many years the medical component of the CPI increased at a greater rate than any other component, even food and housing. Between 1960 and 2006 the average annual percent of change from the previous year shown in the overall CPI was well below the average annual percent of change for medical care. (See Table 9.2.) In 2006 the overall CPI increased by 3.2%, whereas medical care increased by 4%. (Energy, however, had the highest percent of change from 2004 to 2006).

The upper portion of Table 9.2 shows the change in prices in a different way—it provides the CPI figure (price level) for each year shown rather than the average annual percent of change from the previous year given in the table. The CPI figure is computed by the Bureau of Labor Statistics (BLS). It is based on the average price of goods and services for the thirty-six-month period covering 1982, 1983, and 1984, which the BLS set to equal 100. (These years are not shown in the top portion of Table 9.2.) Each year, the BLS measures changes in prices in relation to that figure of 100. The resultant figures show the change in relation to the reference years of 1982 to 1984. Thus, the years before the 1982–84 period have price levels below 100, and the years after this period have price levels above 100. For example, an index of 110 means there has been a 10% increase in price since the reference period. An index of 90 means a 10% decrease. “All items” cost slightly more than twice as much in 2006 than they did during the 1982–84 period (201.6 versus 100), whereas medical care cost well over three times as much (336.2 versus 100).

So where did all the money spent on health care in 2006 come from? Fifty-three percent came from private funds, including private health insurance (34%), out-of-pocket expenses (12%), and other private sources (7%). (See Figure 9.1.) The remaining 46% came from federal or state government sources.

Where did all the money spent on health care in 2006 go? Hospital and physician costs, traditionally composing the greater part of health-care expenses, were 31% and 21%, respectively, whereas prescription drug costs were 10% of all health-care expenses. (See Figure 9.2.)

GOVERNMENT HEALTH-CARE PROGRAMS

Unlike most developed countries, the United States does not have universal health care. Two government entitlement programs that provide health-care coverage for older adults (aged sixty-five and older), the poor, and the disabled are Medicare and Medicaid. Enacted in 1965 as amendments to the Social Security Act of 1935, these programs went into effect in 1966. In 1972 amendments to Medicare extended medical insurance coverage to those disabled long term and those with chronic kidney disease or end-stage renal disease. In 2006, 43.2 million older adults and people with disabilities were enrolled in Medicare, with total expenditures of $408.3 billion. (See Table 9.3.)

The Original Medicare Plan

The Original Medicare Plan, enacted under Title XVIII of the Social Security Act, comprises two health-related insurance plans:

• Part A (hospital insurance) is funded by Social Security payroll taxes. It pays for inpatient hospital care, which includes physicians' fees, nursing services, meals, a semiprivate room, special care units, operating room costs, laboratory tests, and some drugs and supplies. It also pays for skilled nursing facility care after hospitalization, home health-care visits by nurses or medical technicians, and hospice care for the terminally ill. Table 9.3 shows that in 2006, 42.9 million Americans were enrolled in Part A, hospital insurance. Of the $408.3 billion in total Medicare expenditures, $191.9billion (47%) was spent on hospital insurance.
• Part B (medical insurance) is an elective medical insurance. Because Part A does not pay all health-care costs and other expenses associated with hospitalization, many beneficiaries enroll in the Part B plan. Most people pay a monthly premium for this coverage. Those monthly premiums and general federal revenues finance Part B. Coverage includes physicians' and surgeons' services, diagnostic and laboratory tests, outpatient hospital services, outpatient physical therapy, speech pathology services, home health-care services, and medical equipment and supplies. Table 9.3 shows that in 2006, 40.3 million Americans were enrolled in Part B. Of the $408.3 billion in total Medicare expenditures, $169 billion (41%) was spent on medical insurance.

Medicare Supplement Insurance (Medigap)

The Original Medicare Plan coverage (Part A and Part B) has gaps, which means that it does not cover all medical costs and services. Medigap insurance is supplemental Medicare insurance that pays these expenses. Medigap is not a way to get Medicare benefits; rather, it is

extra insurance sold by private insurance companies to those who have Original Medicare Plan coverage. Except in Massachusetts, Minnesota, and Wisconsin, there are ten standardized plans labeled Plan A through Plan J. Medigap policies only work with the Original Medicare Plan.

Medicare Advantage Plans (Part C)

Medicare Advantage Plans are offered by private companies that have contracts with Medicare to provide Medicare services. Even though there are generally lower copayments (the amounts patients pay for each medical service) and extra benefits with Medicare Advantage Plans versus the Original Medicare Plan, generally patients must see physicians who belong to the plan and go to certain hospitals to get services. Medicare Advantage Plans include Medicare Health Maintenance Organizations, Medicare Preferred Provider Organizations, Medicare Special Needs Plans (designed for specific groups of people), and Medicare Private Fee-for-Service Plans.

Other Medicare Health Plans

Other types of Medicare Health Plans include Medicare Cost Plans, Demonstrations, and Programs of All-inclusive Care for the Elderly (PACE). Medicare Cost

Plans are limited in number and combine features of both Medicare Advantage Plans and the Original Medicare Plan. Demonstrations are special projects that test possible future improvements in Medicare costs, coverage, and quality of care. PACE provides services for frail elderly Americans.

Medicare Prescription Drug Plans (Part D)

On January 1, 2006, Medicare began to offer insurance coverage for prescription drugs to everyone with Medicare. Its Medicare Prescription Drug Plans typically pay half a person's prescription drug costs. Most people pay a monthly premium for this coverage. Medicare Prescription Drug Plans are available with the Original Medicare Plan, Medicare Advantage Plans, and the other Medicare health plans. Table 9.3 shows that in 2006, 27.9million Americans were enrolled in Part D (prescription drug plans). Of the $408.3 billion in total Medicare expenditures, $47.4 billion (12%) was spent on prescription drug plans.

Medicaid

The Medicaid health insurance program, enacted under Title XIX of the Social Security Act, provides medical assistance to low-income people, including those with disabilities and members of families with dependent children. Jointly financed by federal and state governments, Medicaid

coverage includes hospitalization, physicians& services, laboratory fees, diagnostic screenings, and long-term nursing home care.

Even though people aged sixty-five and older made up only 7.8% of all Medicaid recipients in 2004, they received 23.1% of all Medicaid benefits. (See Table 9.4.) The average payment was $13,687 per older adult, compared to $13,714 for the blind and disabled, $2,475 for adults in families with dependent children, and $1,664 for children under the age of twenty-one.

WHO PAYS FOR END-OF-LIFE CARE?

Hsiang-Ching Kung et al. state in “Deaths: Final Data for 2005”(National Vital Statistics Reports, vol. 56, no. 10, April 24, 2008) that nearly three-fourths (73%) of those who died in 2005 were aged sixty-five or older. Medicare covers the medical expenses of these older adults during the terminal stage of their life. Medicaid further covers older adults who have exhausted their Medicare benefits, as well as poor and disabled younger patients. Health programs under the U.S. Department of Veterans Affairs and the U.S. Department of Defense also pay for terminal care.

In “Medical Expenditures during the Last Year of Life: Findings from the 1992–1996 Medicare Current Beneficiary Survey” (Health Services Research, vol. 37, no. 6, December 2002), the most comprehensive documentation of Medicare end-of-life costs available, Donald Hoover et al. of Rutgers University note that Medicare currently pays most end-of-life medical costs for individuals in this age group but state that the elderly may be expected to pay an increasing proportion of

end-of-life costs as the number of elderly individuals in the population increases and end-of-life costs increase as a result.

Hoover et al. show that an average person over age sixty-five who died between 1992 and 1996 created approximately $40,000 of medical expenditures in his or her last year of life. Of this amount, Medicare paid approximately $32,800 (82%), supplemental/private insurance paid about $2,000 (5%), and the individual paid approximately $5,200 (13%). The researchers determine that about 25% of Medicare expenditures and about 20% of all health-care expenditures for the elderly go to those in their last year of life.

According to Hoover et al., several initiatives such as hospice and advanced directives have attempted to reduce end-of-life medical costs. However, the researchers contend that costs have not decreased notably as a fraction of total Medicare expenditures over the past twenty-five years. Nonetheless, Donald H. Taylor Jr. et al. suggest in “What Length of Hospice Use Maximizes

Reduction in Medical Expenditures Near Death in the U.S. Medicare Program?” (Social Science and Medicine, vol. 65, 2007) that research results are mixed on this topic. Results of their research reveal that “hospice use reduced Medicare program expenditures during the last year of life by an average of $2,309 per hospice user.” Taylor et al. note that the amount of the reduction varied based on the disease from which the patient was dying. The maximum reduction was seen in terminal cancer patients and was calculated to be approximately $7,000 per patient when hospice was used for the last 50 to 103 days of life.

No specific information about the cost of end-of-life care exists for the one-fourth of those who die every year who are under age sixty-five. Such care is more than likely financed by employer health insurance, personal funds, Medicare, and Medicaid. Nonetheless, aside from funds paid out for hospice services, the government has no other information about this group's terminal health care.

Medicare Hospice Benefits

In 1982 Congress created a Medicare hospice benefit program via the Tax Equity and Fiscal Responsibility Act to provide services to terminally ill patients with six months or less to live. In 1989 the U.S. General Accounting Office (GAO; now called the U.S. Government Accountability Office) reported that only 35% of eligible hospices were Medicare certified, in part due to the Health Care Financing Administration's low rates of reimbursement to hospices. That same year Congress gave hospices a 20% increase in reimbursement rates through a provision in the Omnibus Budget Reconciliation Act.

Under the Balanced Budget Act (BBA) of 1997, Medicare hospice benefits are divided into three benefit periods:

• An initial ninety-day period
• A subsequent ninety-day period
• An unlimited number of subsequent sixty-day periods, based on a patient's satisfying the program eligibility requirements

At the start of each period the Medicare patient must be recertified as terminally ill. After the patient's death, the patient's family receives up to thirteen months of bereavement service.

In 2006 there were 3,078 Medicare-certified hospices, a substantial increase from 31 hospices in 1984. (See Table 9.5.) This growth was stimulated in part by increased reimbursement rates established by Congress in 1989. Of the 3,078 hospices, 650 were with home health agencies (HHA), 563 were affiliated with hospitals (HOSP), 14 were with skilled nursing facilities (SNF), and 1,851 were freestanding hospices. From 2000 to 2006 the number of Medicare-certified freestanding hospices had nearly doubled, whereas other types of hospice facilities decreased slightly in number (HHA and SNF) or remained relatively static (HOSP). Medicare pays most of the cost of hospice care.

Terminally ill Medicare patients who stayed in a hospice incurred less Medicare cost than those who stayed in a hospital or skilled nursing facility. In 2006 a one-day stay in a hospice cost Medicare $136, compared to $535 for a skilled nursing facility and $5,036 for a hospital. (See Table 9.6.)

The Hospice Association of America (HAA) contends that terminally ill patients often wait too long to enter hospice care. The HAA believes the difficulty of predicting when death may occur could account for part of the delay, along with the reticence of caregivers, patients, and family to accept a terminal prognosis.

Even though terminal care is often associated with hospice, the hospice Medicare benefit represents a small proportion of the total Medicare dollars spent. In 2006, $8.5 billion (2.5%) of all Medicare benefit payments went to hospice care. (See Table 9.7.) The 2007 projected hospice spending was comparably small, at $9.7 billion (2.6%) of the projected $376.4 billion in total Medicare expenditures.

Medicaid Hospice Benefits

Hospice services also comprise a small portion of Medicaid reimbursements. In 2003 Medicaid reimbursements for hospice accounted for $897.6 million (0.4%) of the $234.1 billion in total expenditures. (See Table 9.8.) Providing hospice care under Medicaid is optional for each state. In 2006 forty-eight states and Washington, D.C., offered hospice benefits. (See Figure 9.3.)

Home Health Care

The concept of home health care began as postacute care after hospitalization, an alternative to longer, costlier hospital stays. The Centers for Medicare and Medicaid Services explains in Medicare and Home Health Care (September 2007, http://www.medicare.gov/Publications/Pubs/pdf/10969.pdf) that in the twenty-first century Medicare's home health-care services provide medical help, prescribed by a doctor, to home-bound people who are covered by Medicare. Having been hospitalized is not a prerequisite. There are no limits to the number of professional visits or to the length of coverage. As long as the patient's condition warrants it, the following services are provided:

• Part-time or intermittent skilled nursing and home health aide services
• Speech-language pathology services
• Physical and occupational therapy
• Medical social services
• Medical supplies
• Durable medical equipment (such as walkers and hospital beds, with a 20% co-pay)

Over time, the population receiving home care services has changed. By 2000 much of home health care was associated with rehabilitation from critical illnesses, and fewer users were long-term patients with

chronic conditions. In 2000, 1,017,900 (75%) of home health users received medical/skilled nursing services, 600,900 (44%) received personal care, 502,600 (37%)

received therapy, and 160,000 (12%) received psychosocial services. (See Table 9.9.)

The percentage of Medicare payments as a portion of total Medicare payments are shown in Figure 9.4. The percentage of home health-care costs of the Medicare budget was 4.3% in 2000, but that percentage dropped to 3.3% by 2007. The number of home care agencies that were Medicare certified declined from a high of 10,444 in 1997 to a low of 6,861 in 2001. (See Table 9.10.) The number has since risen to 8,838 in 2006 but is still far below the 1997

figure. The National Association for Home Care and Hospice believes the decline in agencies since 1997 is the direct result of changes in Medicare home health reimbursement enacted as part of the BBA. However, the recent increase is likely due to relaxed eligibility criteria for home health care, including in 2003 the elimination of the requirement of an acute hospitalization before receiving home care. These relaxed criteria enabled an increased number of beneficiaries to use home health services.

Of the total costs for home health care in 2003, Medicare paid 83.3%. (See Figure 9.5.) Medicaid paid 1.8% of

the costs, and individuals paid 8.8%. The remaining 6.1% of home health-care costs in 2003 were paid in other ways, such as by private insurance payments.

MEDICARE LIMITS HOME CARE SERVICES. The GAO indicates in Medicare Home Health Care: Prospective Payment System Will Need Refinement as Data Become Available (April 2000, http://www.gao.gov/archive/2000/he00009.pdf) that during the 1990s Medicare's home health care costs increased nearly fivefold, from $3.7 billion in 1990 to $17.8 billion in 1997. In “Length of Stay in Home Care before and after the 1997 Balanced Budget Act” (Journal of the American Medical Association, vol. 289, no. 21, 2003), Rachel L. Murkofsky et al. explain that the BBA aimed to cut approximately $16.2 billion from Medicare home care expenditures over a period of five years. The federal government sought to return home health care to its original concept of short-term care plus skilled nursing and therapy services. Medicare beneficiaries who received home health care lost certain personal care services, such as assistance with bathing, dressing, and eating.

The BBA sharply curtailed the growth of home care spending, which greatly affected health-care providers.

William D. Spector, Joel W. Cohen, and Irena PesisKatx state in “Home Care before and after the Balanced Budget Act of 1997: Shift in Financing and Services” (Gerontologist, vol. 44, no. 1, 2004) that after the enactment of the law in 1997, annual Medicare home health-care spending fell 57% from the 1996 level by 1999. The decline was mainly in skilled services, such as skilled nursing care. In addition, the number of current home health-care patients declined, in large part due to decreased funding. (See Figure 9.6.) However, the decline began one year before the BBA, so more factors than decreased Medicare funding were likely to be playing a role in the decline.

LONG-TERM HEALTH CARE

Longer life spans and life-sustaining technologies have created an increasing need for long-term care. For some older people, relatives provide the long-term care; but those who require labor-intensive, round-the-clock care often stay in nursing homes.

Nursing Home Care

Growth of the home health-care industry in the 1980s and early to mid-1990s was only partly responsible for the decline in the rate of Americans entering nursing homes (residents per one thousand population). (See Table 9.11.) Declines also occurred in years when numbers of home health-care patients declined after the implementation of the BBA in 1997. Other factors responsible for the decline in the rate of Americans entering nursing homes are that many elderly people are choosing assisted living and continuing-care retirement communities, which offer alternatives to nursing home care. There is also a trend toward healthy aging—more older adults are living longer with fewer disabilities.

Nonetheless, in 2004 slightly more than 1.3 million adults aged sixty-five and older were nursing home residents. (See Table 9.11.) Most were white (1.1 million; 87%) and female (980,000; 74%), and more than half (674,000; 51%) were eighty-five years and older.

Nursing homes provide terminally ill residents with end-of-life services in a variety of ways:

• Caring for patients in the nursing home
• Transferring patients who request it to hospitals or hospices
• Contracting with hospices to provide palliative care (care that relieves the pain but does not cure the illness) within the nursing home

Medicare does not pay for long-term nursing home services. It pays only for services in a skilled nursing

facility for people recovering from medical conditions such as a hip fracture, heart attack, or stroke. Medicaid does pay for nursing home care, but only if the individual meets state income and resource requirements for Medicaid assistance.

Figure 9.5 shows the sources of payment for longterm care for Medicare/Medicaid beneficiaries in 2003. Medicaid pays 50% of long-term care costs for covered individuals. About 40.5% of the costs are paid for by the individuals themselves. The remaining 9% of long-term costs were paid in other ways, such as by long-term care insurance companies for their policyholders.

Patients in a Persistent Vegetative State

The precise number of patients in a persistent vegetative state (PVS) is unknown because no system is in place to count them. Very little information is published in the literature documenting the costs of maintaining patients in a PVS. Melissa C. Bush et al. report in “Pregnancy in a Persistent Vegetative State: Case Report, Comparison to Brain Death, and Review of the Literature” (Obstetrical and Gynecological Survey, vol. 58, no.

11, November 2003) that a 1988 estimate placed costs of maintaining a pregnant woman in a PVS at $183,000 for nine weeks, and a 1996 estimate placed costs at $200,000 for twenty-seven weeks. The costs to maintain patients in a persistent vegetative state vary depending on the acuity of care needed (the type, degree, or extent of required services).

The End-Stage Renal Disease Program

Amendments to the Social Security Act in 1972 extended Medicare coverage to include end-stage renal disease (ESRD) patients. ESRD is the final phase of irreversible kidney disease and requires either kidney transplantation or dialysis to maintain life. Dialysis is a medical procedure in which a machine takes over the function of the kidneys by removing waste products from the blood. Between 1994 and 2003 about three-quarters of ESRD patients underwent dialysis and the remaining quarter had kidney transplants. (See Table 9.12.) Over this period the percentage of transplants increased slightly, with a resultant slight decline in the percentage of those maintained on dialysis.

Medicare beneficiaries with ESRD are high-cost users of Medicare services. According to the Medicare Payment Advisory Commission, in A Data Book: Health-care Spending and the Medicare Program (June 2006, http://www.medpac.gov/publications/congressional_reports/Jun06DataBook_Entire_report.pdf), patients with ESRD made up only 0.4% of enrollees in 2003, yet they

accounted for 2.7% of Medicare spending in that year. Between 1994 and 2003 the ESRD population grew by 66%. (See Table 9.12.) In 1994 there were 272,300 ESRD patients in the Medicare system, and by 2003 this figure had grown to 453,000 ESRD patients.

PATIENTS WITH TERMINAL DISEASES

Acquired Immunodeficiency Syndrome

Acquired immunodeficiency syndrome (AIDS) is a set of signs, symptoms, and certain diseases occurring together when the immune system of a person infected with the human immunodeficiency virus (HIV) becomes extremely weakened. According to the Centers for Disease Control and Prevention (CDC), advances in treatment during the mid- to late 1990s slowed the progression of HIV infection to AIDS and led to dramatic decreases in AIDS deaths.

Deaths from AIDS fluctuated from 2001 through 2005. (See Table 9.13.) The number of AIDS diagnoses increased each year from 2001 to 2005. In 2001 an estimated 38,079 people had been diagnosed with HIV, and in 2005 this number had risen to 40,608. Cumulatively through 2005, 952,629 people had been diagnosed with AIDS, 530,756 had died from the syndrome, and 421,873 were living with it.

Figure 9.7 shows federal funding for HIV/AIDS from the beginning of the AIDS epidemic through 2006. Funding began modestly, at less than $100 million. In 2006 the federal funding for all aspects of HIV/AIDS was $21.7 billion.

Figure 9.8 shows the categories of funding for HIV/AIDS and compares differences in categories of funding in fiscal years 1982, 1985, 1990, and 2006. At the beginning of the HIV/AIDS epidemic, 50% of federal funding was spent on research because at that time little was known about the disease, how to prevent it, and how to treat people who had contracted it. By 1985 and 1990, as medical researchers learned more about the disease, the proportion devoted to research shrank to 36% and 38%, respectively. By 2006 only 13% of federal HIV/AIDS funding went to research.

Likewise, the proportion of federal funds targeted for prevention have shrunk over the years as well. Twenty-five percent of federal funding went to prevention in 1982, 16% in 1985, 13% in 1990, and 4% in 2006.

Conversely, the percentage of federal funds devoted to the care and treatment of patients with HIV/AIDS has increased dramatically as more people acquire the disease and live longer with it. In 1982, 25% of federal funding was targeted for care and treatment of HIV/AIDS, and in 2006, 58% was spent on care and treatment. Figure 9.8 also shows that the federal government now spends money on the global fight against this disease. In 1990, 3% of the federal annual HIV/AIDS budget was used to help fight this disease globally. By 2006 this percentage had grown to 15% of the total federal HIV/AIDS budget.

MEDICAID ASSISTANCE. The financing of health care for AIDS patients has increasingly become the responsibility of Medicaid, the entitlement program that provides medical assistance to low-income Americans. This is due, in large part, to the rising incidence of AIDS among poor people and intravenous drug users—the groups least likely to have private health insurance. Furthermore, many patients who have private insurance through their

employers lose their coverage when they become too ill to work. These individuals eventually turn to Medicaid and other public programs for medical assistance.

Some people, whose employment and economic condition previously afforded the insurance coverage they needed, find their situation changed once they test positive for HIV. Some may become virtually ineligible for private health insurance coverage. Others require government assistance because insurance companies can declare HIV infection a preexisting condition, making it ineligible for payment of insurance claims. In addition, some insurance companies limit AIDS coverage to relatively small amounts.

THE RYAN WHITE COMPREHENSIVE AIDS RESOURCES EMERGENCY ACT. As of 2008 the Ryan White Comprehensive AIDS Resources Emergency (CARE) Act was the only federal program providing funds for the care, treatment, and support of low-income, uninsured, and underinsured men, women, children, and youth. The act is named after an Indiana teenager who had AIDS and worked against AIDS-related discrimination. The act was initially passed in 1990 and was reauthorized in 1996, 2000, and 2006. The Ryan White HIV/AIDS Treatment Modernization Act of 2006, which was the 2006 reauthorization, changed somewhat how Ryan White funds could be used and put an emphasis on life-saving and life-extending services for people living with HIV/AIDS. The appropriations of CARE funds follow the following formulas:

• Part A (formerly called Title I)—the federal government provides emergency assistance to metropolitan areas disproportionately affected by the HIV epidemic. To qualify for Part A financing, eligible metropolitan areas must have more than two thousand cumulative AIDS cases reported during the preceding five years and a population of at least five hundred thousand. The 2006 reauthorization gives priority to urban areas with the highest number of people living with AIDS. In addition, priority is also given to out-reach, testing, and helping midsized cities and areas with emerging needs.
• Part B (formerly called Title II)—the federal government provides funds to state governments. Most of the Part B funds are allocated based on AIDS patient counts, while the remaining funds are distributed through competitive grants to public and nonprofit agencies. In addition, states receive funding to support AIDS Drug Assistance Programs, which provide medication to low-income HIV patients who are uninsured or underinsured.

• Part C (formerly called Title III)—federal funds are designated for Early Intervention Services (EIS) and planning. EIS grants support outpatient HIV services for low-income people in existing primary care systems,

• and planning grants aid those working to develop HIV primary care.
• Part D (formerly called Title IV)—these federal programs focus on the development of assistance for women, infants, and children.

Figure 9.9 shows the annual funding for the Ryan White CARE Act from its inception in 1991 through 2006. Between 1991 and 2006 Ryan White CARE Act funding increased slightly more than tenfold, from $200 million to $2.1 billion. Figure 9.10 shows the locations of Ryan White HIV/AIDS Program providers across the United States.

Cancer

Cancer, in all its forms, is expensive to treat. Compared to other diseases, there are more options for cancer treatment, more adverse side effects that require treatment, and a greater potential for unrelieved pain. According to the American Cancer Society, in Cancer Facts & Figures 2008 (2008, http://www.cancer.org/downloads/STT/2008CAFFfinalsecured.pdf), the overall estimated cost of cancer to the nation in 2007 was $219.2 billion. Of this amount, $89 billion was due to direct medical costs. Of the remainder, $18.2 billion was the cost of lost productivity due to illness, and $112 billion was the cost of lost productivity due to premature death.

MEDICARE, CLINICAL TRIALS, AND CANCER. Some health insurance plans cover all or a portion of the costs associated with clinical trials (research studies that offer promising new anticancer drugs and treatment to enrolled patients). Policies vary, and some plans decide whether they will pay for clinical trials on a case-by-case basis. Some health plans limit coverage to patients for whom no

standard therapy is available. Others cover clinical trials only if they are not much more expensive than standard treatment, and many choose not to cover any costs involved with clinical trials.

On June 7, 2000, President Bill Clinton (1946–) revised Medicare payment policies to enable beneficiaries to participate in clinical trials. Before this policy change, many older adults were prevented from participating in clinical trials because they could not afford the costs associated with the trials.

Alzheimer's Disease

The Alzheimer's Association (March 20, 2008, http://www.alz.org/alzheimers_disease_facts_figures.asp) notes that in 2008 there were 5.2 million people in the United States with Alzheimer's disease (AD). AD is a form of dementia characterized by memory loss, behavior and personality changes, and decreasing thinking abilities. The Alzheimer's Association also notes that the direct and indirect costs of AD and other dementias cost the United States over $148 billion annually.