Sunday, January 13, 2008

16% of GNP spent on health care (W

One dollar in six goes for pills and plasters and doctor's bills. Our international competitors Japan, Germany, France, the rest of the EU, spend half that. And, after paying twice as much as anyone else, we don't get anything for it. Objective measures of health, life expectancy and infant mortality are no better in the US than in Europe.
So, the price of every American product is jacked up 16% to feed the medics. Our competitor's prices only bear an 8% load. Can a US firm compete with an 8% cost disadvantage? Can our salesmen close the sale when our products are more expensive? Probably not. Why does the US run such a humungous trade deficit every year? Over priced products are one good reason.
Back in 1980 health care costs were only 8% of GNP. In the 28 years since, US health care costs have doubled. Is the quality of 2008 health care any better than 1980 health care. Life expectancy and infant mortality say no; they have not improved. We are just spending an awful sum of money and getting nothing back for it.
The economic drain of health care costs is too great to bear now. The democrats want to offer free health care to everyone in the country. That will push the percentage of GNP even higher, and really wreck the American economy. If something is free, more people will use it.
Let's cut the outrageous costs of health care. If the price were reasonable, ordinary people could afford to pay their doctors.

3 comments:

M. Simon said...

The way to reduce health care is to get government out of insurance mandates and keep free care to the very poor.

Means testing and large deductibles would help a lot.

Dstarr said...

And allow insurance companies to sell policies in any state of the union. That would bypass the state mandates for coverage of all sorts of things. The mandates are very popular with providers who have trade associations to lobby for more mandates.

Dennis James Deegan DTM said...

Mr. Starr:

I did not see in your narrative any reference to the cost drivers that make up the ongoing increases in the cost of health care.

Your readers should know that about 80-85% of every claim is a pure result of the cost of the medical or hospital services. Insurance administration is 12-15% on average.

Over 50% of the health care dollar are illnesses that are the direct result of lifestyle; many people make unhealthy choices; eat too much, eat fatty foods, do not exercise, smoke and do not manage their stress very well. This leads to high incidence of high blood pressure, high cholesterol, blocked arteries, diabetes, heart attack and strokes and cancer.

Personal responsibility for wise living would be a great start instead of finding a bogeyman to blame; ie the docs or hosptials.

Competition and information from providers would be a good start so the patient knows what providers are getting the best results on their surgery and what hospitals have the highest quality; ie low morbidity, low infection rate. If patients shopped for quality in their care, based upon transparency, competition would force higher quality or the provider would go out of business.

We need smart consumer oriented health care; not government run bureacracies. Intelligent choices, are what we need more of; less name calling.