NCPA - National Center for Policy Analysis


August 12, 2009

Expanding preventive medical services may well improve public health, but it is highly unlikely to save the government money, says the Congressional Budget Office (CBO).

In a letter to leaders of the House Energy and Commerce Committee, CBO director Douglas W. Elmendorf said the evidence suggests that the cost of making services such as cancer screening, cholesterol management, vaccinations and wellness training broadly available would far outweigh any savings ultimately generated.

According to a study published last year in the New England Journal of Medicine:

  • Slightly fewer than 20 percent of (preventive) services that were examined save money, while the rest add to costs.
  • Another recent study from the American Diabetes Association, the American Heart Association and the American Cancer Society found that highly recommended preventive measures such as monitoring blood pressure for diabetics and checking cholesterol levels for people at high risk of heart disease "would substantially reduce the projected number of heart attacks and strokes that occurred."
  • However, the tests would also increase total spending on medical care because the ultimate savings would offset only about 10 percent of the costs of the preventive services, on average.

Although different types of preventive care have different effects on spending, the evidence suggests that, for most preventive services, expanded utilization leads to higher, not lower, medical spending overall, says Elmendorf.

Furthermore, his letter directly contradicts the assertions of some lawmakers, including House Speaker Nancy Pelosi (D-Calif.), who argued last month that spending money on prevention should lower the overall costs of legislation to overhaul the nation's health-care system.

Source: Lori Montgomery, "Expanding Preventive Care May Add to Costs, CBO Says," Washington Post, August 8, 2009.

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