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Chronic Disease Cost Calculator Top
Frequently Asked Questions (FAQ)
- Why are the Chronic Disease Cost Calculator estimates
important?
- Why are the Cost Calculator spending estimates lower than
other chronic disease cost estimates?
- What if there are discrepancies between the Cost
Calculator estimates and other Medicaid estimates?
- Because hypertension and diabetes are both diseases
themselves and also risk factors for other diseases, do they present any
issues for the Cost Calculator?
- Can the Cost Calculator be used to compare my state
with other states or the nation? My state has higher/lower Medicaid
spending than other states. Why?
- What kind of guidance or technical support is available?
- What enhancements to the calculator are anticipated in
the next two years?
PDF version: Chronic Disease Cost Calculator Top Frequently Asked Questions (FAQ) (PDF–144K)
- Why are the Chronic Disease Cost Calculator estimates important?
The Chronic Disease Cost Calculator is a downloadable tool that provides
the first Medicaid-specific, state-level estimates of Medicaid spending for
six chronic diseases: congestive heart failure, heart disease (other than
congestive heart failure), stroke, hypertension, cancer and diabetes. Cost
Calculator cost estimates include both federal and state payments for
Medicaid and reflect how much money the Medicaid program spends on a
specific set of chronic diseases within a state in one year. The statistical
analysis used to generate these estimates minimizes double-counting of costs
across diseases, which often occurs in other cost estimates. For a detailed
explanation of Cost Calculator methodology, including how it calculates
prevalence and per person costs, refer to the Cost Calculator Technical
Appendix.
These estimates provide vital information to better understand how
pervasive these chronic diseases are and the cost burden they impose. These
Medicaid estimates should not be viewed as “too high” or “too low.” Rather,
they need to be taken in context by considering the overall health needs of
the population and the degree to which those needs are being met. Further,
Medicaid spending is only a portion of the total cost burden of these
chronic diseases. The Cost Calculator does not include: Medicare, private
insurance, and individual out-of-pocket spending. Also, the Cost Calculator
does not take into account lost economic productivity due to disability and
premature death. Although these estimates represent only a portion of the
total economic burden of these diseases, they provide vital information to
better understand the scope of the problem.
All reported numbers are estimates and could differ from actual values.
The Cost Calculator is designed to provide the best possible estimates given
the data available on each state’s allocation of Medicaid resources for each
of the six chronic diseases. The default data used by the Chronic Disease
Cost Calculator have at least four limitations:
- Medical Expenditure Panel Survey (MEPS) data used by the Cost
Calculator are self-reported. However, extensive efforts are
undertaken to validate self-reported diagnosis and expenditure data.
- The MEPS sampling design excludes the institutionalized
population (excludes long term care). Although Medicaid data were
used to adjust for long term care costs, these adjustments were
based on data from only four states, which may not be nationally
representative.
- Although the overall sample size is reasonably large, the
expenditure estimates are associated with uncertainty, and the
variance in the estimates is greater for those diseases that are
less prevalent in the Medicaid population.
- These estimates include prescription drug expenditures for
individuals who are dually eligible for Medicare and Medicaid.
Following the introduction of the Medicare outpatient prescription
drug benefit in January 2006, Medicaid no longer pays for these
services.
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- Why are the Cost Calculator spending estimates lower
than other chronic disease cost estimates?
There are reasons why prevalence and spending estimates for the Medicaid
population are lower than one might assume:
- Prevalence estimates for the Medicaid population may appear lower
than expected because the majority of Medicaid beneficiaries are age 18
and under (51%), almost double the proportion found within the general population,
and these diseases are far less prevalent in this younger population.
- The majority of Medicaid beneficiaries receiving treatment for any
of these six chronic diseases are dually eligible for Medicare coverage.
The Medicaid expenditure estimates in the Cost Calculator only include
the Medicaid portion of spending for dual eligibles and do not include
Medicare expenditures. Medicare is the primary payer for most services
for dually eligible beneficiaries.
There are also specific reasons why the Chronic Disease Cost Calculator
spending estimates may be lower than other spending estimates that use
different methodologies:
- The statistical analysis used by the Cost Calculator employs an econometric
methodology that minimizes double-counting (i.e., overlap of disease costs)
of Medicaid dollars going to multiple diseases.
- The per person cost estimates are based on all persons reporting treatment
for or problems with a disease within the interview year, rather than new
diagnoses during the year, and include people at any stage of treatment. For
example, cancer costs may appear low because they include both people in the
acute phase of treatment and those receiving longer term follow-up.
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- What if there are discrepancies between the Cost Calculator estimates and
other Medicaid estimates?
The Cost Calculator provides consistent estimates of state Medicaid chronic
disease expenditures for all states using a single methodology and common set of
databases.
Cost Calculator estimates may differ from other state Medicaid estimates for
several reasons:
- Differences in the type of data (e.g., survey vs.administrative).
- Definition of chronic disease prevalence.
- Methodology to attribute costs to diseases (e.g., accounting vs.
regression).
- Differences in the time period of the data. Estimated spending in the Cost
Calculator is based on 2001–2005 data inflated forward to 2007 dollars.
- All estimates involve some uncertainty. Although estimates in the Cost
Calculator may appear different from other estimates, they may not be
statistically significant differences.
However, when discrepancies occur, users should contact the state Medicaid
department and state health department to help determine which set of data
and modeling assumptions are most appropriate in the given situation.
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- Because hypertension and diabetes are both diseases themselves and also
risk factors for other diseases, do they present any issues for the Cost
Calculator?
Given that both hypertension and diabetes are themselves diseases that
require treatment as well as leading causes of other diseases in the
Calculator, these cost estimates include expenditures for the diseases for
which they are risk factors. As a result, when summing the costs of
hypertension and/or diabetes with the costs of other cardiovascular
diseases, a small amount of double-counting will occur.
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- Can the Cost Calculator be used to compare my state with other states or
the nation? My state has higher/lower Medicaid spending than other states.
Why?
The Cost Calculator was not designed to make statistical comparisons between
states or between a state and the national estimate.
The primary factors that influence a state’s total estimated cost for each
disease are the prevalence of these diseases in the Medicaid population and
variables specific to each Medicaid program, including the number of people
served, the age distribution of the Medicaid population, eligibility
criteria, and services covered under Medicaid. Cost Calculator estimates are
a reflection of services and treatment provided according to self-reports
and do not necessarily capture the full burden of disease or the need for
services among this population.
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- What kind of guidance or technical support is available?
Directions for
use are available at the Cost Calculator website and through help buttons on the Cost Calculator itself. The User Guide and
the Technical Appendix both provide guidance on the Cost Calculator. In
addition, technical support can be requested at the website or at the
following email address: cdcostcalculator@cdc.gov
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- What enhancements to the calculator are anticipated in the next two
years?
Future iterations of the cost calculator will include estimates of
the prevalence and costs of asthma, arthritis, and depression; estimates of
the medical costs to Medicare and private payers; estimates of the indirect
costs of lost productivity; and projections of future costs.
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One or more documents on this Web page is available in Portable Document Format
(PDF). You will need Acrobat
Reader (a free application) to view and print these documents.
Page last reviewed: November 5, 2008
Page last modified: November 5, 2008
Content source: National Center for
Chronic Disease Prevention and Health Promotion |
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