Between 2005 and 2012, health care spending among people 65 and older fell an average of nearly $3,000 per person a year, the new study found. That adds up to a total savings of $120 billion, with about half coming from Medicare.
And lower spending on heart disease accounted for as much as half of the reduction, according to the Harvard University study.
"This is the first time, to my knowledge, anyone has shown that some forms of medical care can save money," said study leader David Cutler, a professor of applied economics.
"You see that claim all the time -- but in terms of widespread preventive care saving money … we've never had that example before," Cutler said in a university news release.
It might seem obvious that preventing illness would reduce health care spending, but many economists believed the opposite, he noted.
"The received wisdom has been that prevention doesn't save money, it only saves lives," Cutler explained. "Of course, that's something we want to do, but the argument was that you shouldn't expect your prevention to save you money."
The reasoning is that prevention programs require large numbers of people to be effective. That makes them costly, with no guarantee they'll work.
As an example, Cutler pointed to quit-smoking efforts.
"If you stop smoking and then you don't have a heart attack, you save the money you'd spend on treating the heart attack," he said. "But the argument has been that, because very few people will manage to stop smoking, you have to intervene with a lot of people, so the number you need to treat is large. And then the second reason is that maybe you don't die of a heart attack, but you're going to die of something, and that will still be expensive … so it's largely a wash."
However, this study shows that even modest spending on preventive care can lead to significant reductions in health care costs, Cutler said.
The findings were published Feb. 4 in the journal Health Affairs.
The U.S. National Heart, Lung, and Blood Institute offers a guide to a healthy heart.
Universal Health Care Would Save Americans 600 Billion A Year
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