Use of the Pre-Post Method to Measure Cost Savings in Disease Management

Abstract

The US disease management (DM) industry continues to endorse the use of the methodologically flawed pre-post design to evaluate financial outcomes, which regularly reports returns on investment of up to 8:1. This is in sharp contrast to the peer-reviewed literature and large Medicare demonstration projects that generally report little, if any, cost savings from DM. The industry defends the practice of using the pre-post evaluation design by suggesting that measuring total healthcare costs at the diseased-population level eliminates regression to the mean and accounts for indirect changes in physician behavior. The industry further argues that equivalent and concurrent control groups are not available and that instead, a cost trend of the non-diseased population should be used to provide equivalence. This article illustrates the fallacies of these arguments and demonstrates how the pre-post technique elicits financial results generally favoring the DM program. Given that the continued use and support of this methodology serves only to propagate the concerns over the financial value of DM, it is time that a collective decision be made as to whether maximizing short-term profits is worth jeopardizing the long-term viability of the entire industry. Additionally as important, other healthcare systems around the world are looking to the US DM industry for guidance as they ponder the introduction of DM in their own countries. The inability of DM to accurately measure and achieve financial savings may be inhibiting the widespread initiation of future DM programs.