The United States had a decent bite at the apple of health care reform about fifteen years ago when Bill Clinton was president and Democrats controlled the House of Representatives and the Senate. Initially, the need for some kind of major reform was widely accepted. But naturally there were disagreements about exactly what to do. And there were also powerful interests opposed to reform. And there were political opportunists determined to simply deny the administration any kind of victory. Naturally, they started denying the problems were real, etc., etc.
The costs of inaction over the past fifteen years have been high. Ben Furnas has made charts and graphs that should finally make it clear that the status quo is unacceptable. Over on the left you can see the trajectory of per person health care costs. Back in 1994, we were already spending over twice as much per person as the OECD average. There are a lot of ins and outs to that, obviously, but it’s telling that the gap between the United States and the next biggest spender — Norway — was pretty enormous.
Over time since then, costs have gone up across the board. The gaps have only gotten larger. Ben cites a McKinsey study that “found that the United States spent $650 billion more on health care than peer OECD countries even after adjusting for wealth.” That’s about $2,000 per person in excess spending. This produces a problem for public finances, for firms that provide their employees with health insurance, and for individuals paying for health care.
Oftentimes, you’ll see one or another of these problems looked at—you’ll see an “entitlement crisis” or you’ll see car companies with crazy labor costs or you’ll see individuals with stagnating wages—but that encourages people to think of solutions that really just involve pushing the problem around. You can shift costs off the government and on to individuals and businesses. Or off businesses and on to individuals and the government. But actually tackling the problem requires a comprehensive approach.
Nor do we appear to be getting anything of value in exchange for our extra money:
It would be one thing if America’s massive health care expenditures since 1994 were yielding first-rate results in health outcomes and the quality of care. Unfortunately, this isn’t the case. In practically every international comparative measure of health quality, the United States lags behind other developed nations who spend just a fraction of what America does on health care.
A recent Commonwealth Fund study found that across 37 indicators covering quality, access, efficiency, and equity, the United States achieves “an overall score of 65 out of a possible 100 when comparing national averages with benchmarks of best performance achieved internationally and within the United States.” In other words, the United States as a whole is performing well below the standards of health, efficiency, and care that are realistic and have been achieved in the most successful U.S. states and other developed nations. And the trends are pointing in the wrong direction: “On those indicators for which trend data exist, performance compared with benchmarks more often worsened than improved… between the 2006 and 2008 Scorecards.”
Obviously, these kind of facts don’t determine what the right course forward should be. But the evidence is pretty overwhelming that what we’re doing isn’t working and it’s working less and less as time goes on. Read here for much more.
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