Health Aff (Millwood). 2014 Dec 1;33(12):2199-206. doi: 10.1377/hlthaff.2014.0828.

Children with medical complexity and medicaid: spending and cost savings.

Berry JG1, Hall M2, Neff J3, Goodman D4, Cohen E5, Agrawal R6, Kuo D7, Feudtner C8.

Author information

• 1Jay G. Berry (jay.berry@childrens.harvard.edu) is an assistant professor of pediatrics in the Department of Medicine and Division of General Pediatrics, Boston Children's Hospital and Harvard Medical School, in Massachusetts.
• 2Matt Hall is a senior statistician at the Children's Hospital Association, in Overland Park, Kansas.
• 3John Neff is a professor of pediatrics at the University of Washington and Seattle Children's Hospital.
• 4Denise Goodman is a professor of pediatrics at the Feinberg School of Medicine, Northwestern University, and the Ann and Robert H. Lurie Children's Hospital, in Chicago, Illinois.
• 5Eyal Cohen is an associate professor of pediatrics at the University of Toronto and the Hospital for Sick Children, in Ontario.
• 6Rishi Agrawal is an assistant professor of pediatrics at the Feinberg School of Medicine, Northwestern University, and the Ann and Robert H. Lurie Children's Hospital.
• 7Dennis Kuo is an associate professor of pediatrics at the University of Arkansas for Medical Sciences and Arkansas Children's Hospital, both in Little Rock.
• 8Chris Feudtner is a professor of pediatrics in the Division of General Pediatrics, PolicyLab, and Department of Medical Ethics at the University of Pennsylvania and the Children's Hospital of Philadelphia, in Pennsylvania.

Abstract

A small but growing population of children with medical complexity, many of whom are covered by Medicaid, accounts for a high proportion of pediatric health care spending. We first describe the expenditures for children with medical complexity insured by Medicaid across the care continuum. We report the increasingly large amount of spending on hospital care for these children, relative to the small amount of primary care and home care spending. We then present a business case that estimates how cost savings might be achieved for children with medical complexity from potential reductions in hospital and emergency department use and shows how the savings could underwrite investments in outpatient and community care. We conclude by discussing the importance of these findings in the context of Medicaid's quality of care and health care reform.