Control Health Care Costs!

According to a Kaiser study, of each dollar spent on health care in the United States, 31% goes to hospital care, 21% goes to physician/clinical services, 10% to pharmaceuticals, 4% to dental, 6% to nursing homes and 3% to home health care, 3% for other retail products, 3% for government public health activities, 7% to administrative costs, 7% to investment, and 6% to other professional services (physical therapists, optometrists, etc). 16% of the country's GDP is health care, the second highest in the world; the average Western nation spends 10% of GDP on health care. The U.S. is the only industrialized nation that does not have a nationalized health system.

Those are the bare bones of medical care in the U.S. There are more facts: 66% of Medicare money annually is spent on the last two months of life, the FDA is famously hostile to new pharmaceuticals so that much of the research has moved overseas, insurance programs are restricted to states and cannot negotiate across state lines which creates byzantine monopolies, medical reimbursement has fallen annually while overhead has annually increased, lawsuits are responsible for 2% of direct medical costs but no one knows how much overhead is generated by the fear of lawsuits--it is estimated at 15% of testing.

Attacking medical costs tends to rest on the old chestnuts of fraud and abuse. Somehow the incredibly inefficient government believes that they can make the system more honest and efficient and save enough money to bring the U.S. into line with other nations.

But everyone else knows that this is untrue. There are only two ways to decrease the GDP contribution of health care from 16% to 10: Decrease health care services by 37.5% or grow the economy by 60% without growing medical expenses. Period.

Do either of these options look likely?