So the NY Times has published a novelist’s opinion on health care costs. They label this a contrarian opinion. I label it hogwash – The Hidden Price Tag for Health Care

Wrong. A recent study found that the growth rate for health care spending, excluding Medicare, had stopped declining and appeared to be leveling off at 7.5 percent annually. Though that is smaller than the figure for some past years, it could cripple the economy soon enough, and my bet is that spending growth will resume its upward spiral before long -especially if the country finds a way to cover the 45 million Americans who now lack insurance.

The absence of more widespread alarm is a symptom of the cost-shifting and confusion that mask the seriousness of the disease. Health care is already consuming 15 percent of our national output, yet Americans are no healthier than people in comparable nations that spend much less. And nothing on the horizon suggests these costs will be constrained soon.

Business should be worried because, no matter who writes the checks, we all pay the bill, and the miracle of compounding means that it will soon be staggering. Uwe E. Reinhardt, an economics professor at Princeton, has said that health care is expected to consume 28 percent of gross domestic product by 2030 – and as much as 46 percent by mid-century.

Some people have argued that advances in medical technology will eventually bail us out. Instead, those advances are likely to drive up costs by giving us more on which to spend, just as they have in the past. Other factors in this spending growth are the aging of the population, not to mention our national habit of overeating and underexercising. The impact will be amplified by the huge cost-shifting that characterizes our system. The cost of hospital care for the uninsured, for instance, is quietly built into hospital prices paid by the insured – who in turn pass along part of their costs to Uncle Sam (through tax deductions).

The author has a superficial knowledge of the problem. Thus, he offers a superficial solution.

BEYOND that, it’s time for business to mobilize its army of lobbyists for a national system of coverage that is comprehensive and competitive, and contains strong incentives not to spend. Like car insurance, it has to be mandatory – for the healthy as well as the sick – but left to individuals to buy. Through tax credits or other means, the government can provide it for those who can’t afford it. We will also need a big national campaign to discourage unhealthy styles of living, which account for so much medical expenditure. And we will need coordinated deployment of information technology to find out what kinds of medical spending are worthwhile and what kinds aren’t.

Spending would probably still grow, but imagine if we could bring down the overall level to 12 percent of G.D.P. – just halfway toward the roughly 9 percent that is the average in other advanced countries. If that happened tomorrow – we’re just imagining, remember – we’d enjoy an annual windfall of more than $300 billion. I can’t think of a better prescription for the economy.

A big campaign to discourage unhealthy styles of living – sounds like wishful thinking. How about a surcharge for unhealthy styles of living?

Consumers respond only to incentives. Consumers make decisions involving cost only when they share the cost.

Our problem remains the dissociation of cost from the patient. We have a system which shelters patients from any understanding of cost. Thus, they want all the newest (and seemingly best) tests, pills and surgeries. But more costly is not necessarily better.

We can ameliorate the rise in health care costs if each patient and physician has a direct understandable stake in those costs. Only then will we see a rush to digest websites like – Consumer Report’s Best Buy Drugs

Prescription drugs can be expensive, even if you have insurance coverage. But there are medicines that can effectively meet your medical needs and give you better value for your health care dollar. Consumer Reports Best Buy Drugs is a free public education service from the nonprofit Consumers Union, publisher of Consumer Reports. Millions of Americans trust Consumer Reports to provide expert, independent information about products and services, and to help them save money.

The information on this website can help you learn about more affordable drug treatment options to discuss with your physician. We work with respected doctors and pharmacists to compare drugs and point you to those that are proven to work based on current scientific evidence. In concise, easy-to-read reports, we tell you what you need to know about the effectiveness, safety and cost of many widely used prescription drugs.

Related posts:

1. Thoughts on health care costs
2. Another view of the health care cost report
3. Health care costs
4. What is a health care right?
5. Spiraling health care costs

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