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New report highlights the cost of diabetes to Texas Medicaid, urges preventive action

The analysis by Milliman estimates that diabetes-related care costs the program between $6 billion and $8 billion every year.

A new analysis by Milliman, commissioned by Episcopal Health Foundation (EHF), reveals the staggering financial impact of diabetes on Texas Medicaid. The study estimates that diabetes-related health care costs contribute between $6 billion and $8 billion annually to the program, accounting for 23%-30% of total Medicaid spending for adults.

“These numbers paint the clear picture of why we need to prioritize diabetes prevention across Texas,” said Dr. Ann Barnes, EHF’s president and CEO. “This report makes a compelling case for early intervention—not only as a public health necessity, but as sound economic strategy.”

Milliman’s analysis in Texas is based on Medicaid claims data from several health insurance plans and the Transformed Medicaid Statistical Information System. 

The report emphasizes that much of the diabetes burden stems from preventable complications and underscores the critical need for statewide investment in diabetes prevention and management strategies.

To mitigate these costs and improve health outcomes, the report offers two key recommendations:

  1. Implementing consistent diabetes screening practices: The report calls for the adoption of routine screening protocols that align with established clinical guidelines. Early detection of prediabetes and diabetes can help prevent complications, reduce the need for costly treatments, and improve patients’ quality of life.
  2. Investing in effective prevention programs: Evidence-based interventions, such as diabetes prevention programs that promote healthier lifestyles and address non-medical drivers of health, are essential for reducing the incidence of diabetes. By targeting high-risk populations, initiatives can prevent the onset of the disease and lower the long-term costs associated with its management.

The report also highlights that while diabetes prevention efforts require upfront investment, the potential long-term savings for Texas Medicaid could be substantial. By reducing the incidence of diabetes and preventing costly complications, the state could redirect resources toward other critical health priorities.