|Selected research from leading health care experts whose findings have a direct bearing on public policies effecting medical progress. Research is chosen based on its quality and relevance by the Medical Progress Today editorial staff.||
The Value of Life and the Rise in Health Spending
Debates over health care spending usually only go in one direction: how do we decrease spending. However, Americans have shown their willingness over time to spend "a rising share of total economic resources on health and have enjoyed substantially longer lives as a result."
These authors argue that Americans increased willingness to pay for health improvements may stem from a "rational response to changing economic conditions – notably the growth of income per person." The researchers "estimate parameters of social preferences about longevity and the consumption of non-health goods and services' and show that the rising value of life causes Americans to discount non-health spending and "move up the marginal-cost schedule of life-extension." In short, "[The] intuition for this result is that life is extremely valuable, and as we get richer and richer, the most valuable channel for our spending is to purchase additional years of life." Indeed, it seems like the old adage that health is wealth is also inversely true: with rising wealth, Americans will spend more on health.
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