Deloitte’s new report, titled “Safeguarding Medicare’s Future: Proactive Care Could Unlock Over $500 Billion in Annual Savings,” shows that making smart investments in preventing diseases, detecting them early, and managing health better could save the U.S. healthcare system up to $2.2 trillion each year by 2040. These actions could also lower Medicare’s spending on medical treatments and prescriptions by more than $500 billion each year and improve the program’s financial health, while helping Americans live longer and healthier lives. The report points out that over 62% of current healthcare spending is used for treating illnesses and injuries after they occur, which amounts to about $3 trillion annually. Chronic diseases like diabetes, heart disease, and cancer offer the biggest savings opportunities, and targeted efforts could save over $700 billion in yearly costs.
Health Technology Insights: Ascletis Reports ASC30 Half-Life of 36 Days, Enabling Once‑Monthly Dosing
As healthcare costs rise and the population ages, Medicare is facing growing financial challenges. To capture these savings, Deloitte suggests that policymakers and key players should focus on prevention, early detection, and proactive care, through efforts that align financial rewards. Moving from a reactive healthcare system to one that prioritizes prevention not only saves money but also improves people’s health outcomes and ensures Medicare’s long-term stability.
The report also shows that proactive care offers strong returns. Preventing diseases or catching them early can significantly lower a person’s lifetime healthcare costs. Currently, only 22% of healthcare spending is used for prevention and wellness activities. The biggest savings come from managing chronic conditions like diabetes, heart disease, and cancer, which take up a large part of Medicare’s budget. Deloitte estimates that prevention programs for these diseases could cut national healthcare spending by over $700 billion every year.
Health Technology Insights: Deerfield Group Unveils New Brand Identity and Expands Services
Andy Davis, a principal and Actuarial Health Care Leader at Deloitte Consulting LLP, explained that the data shows a clear path showing how prevention can save money across different disease areas. He said this presents an opportunity for stakeholders to work together, invest in early detection and prevention, and help more Americans live longer, healthier lives while reducing healthcare costs. Neal Batra, a principal and Future of Health Leader at Deloitte Consulting LLP, added that the current healthcare model waits until people get sick before providing care. He believes it’s time to shift focus toward prevention and proactive management to make longer, healthier lives achievable and affordable. Batra noted that this change is not only better medicine but also a financially smart move that could save Medicare $500 billion a year and ensure its long-term viability.
Everyone benefits from more investments in prevention and proactive health management, according to the report. Medicare would see lower long-term costs, employers would have a healthier and more productive workforce, and individuals would face lower healthcare expenses and enjoy better quality of life. To achieve these savings, coordinated action is needed from government agencies, employers, health plans, and healthcare providers. The report suggests that government policies could encourage commercial and Medicare plans to invest more in disease prevention through new payment models and reimbursement structures. Employers already cover a big part of healthcare costs and could improve employee health and reduce future expenses by supporting prevention programs. Health plans could work more closely with employers to promote healthy lifestyles and lower premiums. Healthcare systems have the chance to shift their focus from just treating diseases to keeping people and communities healthy.
Deloitte’s analysis is based on five years of medical and pharmacy claims from nearly 60 million people, using data from the Komodo Healthcare MapTM. Claims were grouped by disease and type of care and scaled to reflect the U.S. population. The study also included consumer spending on health and wellness and government-funded health activities to provide a full view of healthcare costs and potential savings. For more details on the methodology, Deloitte invites interested parties to request the full report.
Health Technology Insights: Immunic Secures U.S. Patent for Multiple Sclerosis Treatment Vidofludimus Calcium’s Dose Strengths
To participate in our interviews, please write to our HealthTech Media Room at sudipto@intentamplify.com
