The NY Times published this article the other day and before I read it, I was thinking, will the authors demonstrate that they “get” healthcare? The subheading of the article referenced the price for care. Recognizing that healthcare costs, not the amount of care, are a factor in rising expenditures was promising. I was intrigued. Sounds like they’re on to something.
Healthcare costs in the US
Throughout the article they provide a detailed analysis in regards to the increasing cost of healthcare. The authors provide evidence that the amount of healthcare Americans utilize is for the most part decreasing.
We spent less time in the hospital, the most expensive location for care in the healthcare system. And we actually got a bit healthier relative to how much we spend.
Based on the article and a JAMA study, 63% of the spending increase since 1996 is due to two things. Providing more care and spending more during each patient visit.
At this point, I’m thinking they’ve made a good argument that most increased costs in healthcare are due “simply” to the cost of the care being provided. But then they offered their solution…more regulation!
Here’s one of the concluding paragraphs:
“There are ways to combat high health care prices. One is an all-payer system, like that seen in Maryland. This regulates prices so that all insurers and public programs pay the same amount. A single-payer system could also regulate prices. If attempted nationally, or even in a state, either of these would be met with resistance from all those who directly benefit from high prices, including physicians, hospitals, pharmaceutical companies — and pretty much every other provider of health care in the United States.”
I would welcome an economist to offer their comments below and remind me when regulation of costs, rather than increasing competition, in any field was a good idea! The solution is not regulation. The best way to lower costs is to make them transparent. That will lead to competition, which, in turn, ultimately lower costs. It’s not that hard to comprehend.