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Adding up the reason's for expensive health care
Pearlstein reports on a study from McKinsey and Co. examining why the U.S. spends more on health care than any country in the developed world:
The study aimed to determine why the United States spends nearly double the average of other industrialized countries on health carewith no better, and in some cases inferior, medical outcomes. Even after adjusting for wealth, population mix and higher levels of some diseases, McKinsey calculated that we spend $477 billion a year more on health care than would be expected if the United States fit the spending pattern of 13 other advanced countries. That staggering waste of money works out to 3.6 percent of the nation's entire economic output, or $1,645 per person, every year.
Another way of phrasing Pearlstein's point is that the consumers of health carethe patientsare not the same people who pay for health care; this leads to overspending on treatments that may only have marginal health valueif any.
But no other country has found the magical solution to health care costs eitheraging populations and increasing technology costs are problems in all developed nations. One solution is to make the government ration health spending. Another possibility is put consumers in the driver's seat and to let providers compete for the best mix of price and services. Before we try Europe's solution, why not try this one?
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