Understanding increased health care costs

Often I blog that we should accept increasing health care costs. Health care costs are increasing because patients are getting greater value . One example of such posts – The Canadian system in trouble

Today’s NY Times has another perspective on this issue. Health Care Costs Are a Killer, but Maybe That’s a Plus

The American health care bill, the government estimates, will be $1.79 trillion this year, or $6,167 per person. By all accounts, there is plenty of waste and inefficiency in health care, ranging from unnecessary clinical tests to the bureaucratic sea of paper used to handle bills, claims and patient records.

If a miracle were to rid the system of all such inefficiency, the total costs would be reduced by 10 percent to 20 percent, health care economists estimate. But the main reason health care spending is rising is that modern medical technology has steadily made it possible to do more for more people. Hips and hearts can be fixed, while the ravages of schizophrenia and depression can be moderated.

The technological marvels of medicine, of course, are little comfort to most of the 45 million Americans who are not covered by health insurance. Yet among the insured majority, millions of people are being treated for physical and mental ailments that went untreated or undetected years ago.

That spells more operations and more pills, and the costs pile up. Bill Clinton’s heart bypass operation and hospital stay earlier this month cost an estimated $25,000, but he, like thousands of others who have undergone the procedure, is expected to return soon to his fully active life.

“Even if you could take all the waste out of health care, the spending would still go up because we have a technology-intensive system that will continue and it is delivering a lot of benefits in terms of longer, healthier lives,” said David Cutler, a health care economist at Harvard University.

So politicians will continue their demagoguery. Sounds bites will focus on “reigning in” health care costs. But no government program can possible work, unless we willingly ration health care. Short of rationing, health care costs will continue to increase, and patients will benefit. This message is an important one, that we need to keep active in our conciousness.