Controlling Our Healthcare Costs, Part 1: Statement of the Problem
We are on an unsustainable path when it comes to health
care spending. The following is simply brainstorming on how some costs
could be contained. This is NOT a proposal.
However, my training has taught me that when you are trying
to solve a problem, you first diagnose the true cause, then devise a plan to eliminate
the cause. 32% of medical costs are administration costs, one of the biggest costs
compared to the administrative costs of Medicare of 6%. It appears that to
lower medical costs, we need to reduce administrative costs by changing the system
to something like Medicare. Let’s call it Americare.
Our health care system is complex. We in the
United States pay far more per person for health care services than other
countries yet get on average poorer results. The average cost of healthcare in
21 different countries The “average” results
may be deceiving as those who have good health insurance or can otherwise pay
out-of-pocket may access the best healthcare services ever available anywhere
in the world. Our clinical abilities are second to none. But, those without as
good financial means do not have the same access, and many that do have the
means live life styles that are not conducive to good health results, bringing
down the average results. Nonetheless, the following charts clearly highlight a
problem.
“According to data from OECD, the US spent $10,209 on healthcare per capita, or per person, in 2017. That's more than any other country in OECD's 36-country consortium, and over $2,000 more than Switzerland, the second-highest spending country.” Ibid.
“[H]ealth spending in
the U.S. has been growing faster than the other OECD countries in spite of
efforts to control spending in the U.S. Overall U.S. health spending increased
at an average rate of 2.8 percent annually between 2000 and 2016, which is
greater than the OECD median annual increase of 2.6 percent. Per capita,
inflation-adjusted spending on pharmaceuticals also increased much more quickly
in the U.S.—at a rate of 3.8 percent per year, compared to just 1.1 percent for
the OECD median.
During the same period, U.S. gross domestic product (GDP)
per capita increased by only 0.9 percent annually, which means that health care
continues to represent a larger share of GDP. U.S. health care spending in 2016
totaled 17.2 percent of GDP, compared to just 8.9 percent for the
OECD median.” U.S. Health Care Spending Highest
Among Developed Countries
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