Tuesday, March 9, 2010

Why Health Care Reform will NOT Lower Health Care Costs

Everyone on the left is telling us that they can lower the total costs of health care will health care reform. They can lower the costs even more with a single-payor government-run system.

Everyone on the right is telling us that they can lower health care costs with tort reform and competition.

Who is right?

Well, I'm going to contend that neither side is correct. And I'm going to back it up.

Let me start by saying that nothing we can do (realistically) is going to lower the total cost Americans spend on health care. I'll go a step further and assert that, with a few rare exceptions, there is nothing we can do to lower the costs to individuals for health insurance premiums.

The problem with the health care reform rhetoric coming from the blow-hards out of Washington is that they don't understand what is causing health care costs to rise. Health care costs are rising primarily due to four factors:

1. Our population is getting older. Remember baby boomers? The largest birth rate ever in America occurred between the years 1945 and 1963. Those Americans are now between the ages of 47 and 65. At what age do you suppose we start having a significant increase in health care costs related to getting older? Generally speaking, the mid-40s to the early-50s. Furthermore, people are living longer. People in the 80s and 90s are no longer the rarity that they were 40 or 50 years ago.

2. Our population is getting fatter. The increasing size of Americans should be alarming us all. The CDC has an alarming graphic on the increasing size of Americans over the past 20 years. Look back even farther to the 1950s and 1960s, and the change is even more dramatic. Forty years ago, it was exceedingly rare to see someone under the age of 40 with type II diabetes related to obesity and a sedentary lifestyle. Today, Type II diabetes related to obesity and a sedentary lifestyle is becoming pandemic among CHILDREN under the age of 18, and rampant among adults over the age of 20.

3. The advancement of Technology. If you went to the doctor in the 1950s or 1960s with a problem that could not be easily diagnosed, one of two things was likely to happen. If the problem didn't seem all that severe or acute, you were probably sent home to see if it got worse or it got better. If it seemed particularly severe or acute, you might have undergone an exploratory surgery. Today, if you go to the doctor for an unexplained illness or pain, you are likely to have an MRI, a PET scan, a CAT scan, expensive blood tests, other kinds of imaging, ultrasounds, sonograms, etc, etc. Thousands and thousands of dollars worth of tests can be performed to diagnose your problem.

That technology has to be paid for. We have a "Cadillac" health care system, and that top-of-the-line system costs money. Do you want to return to the technology of the 1950's, or would you rather pay for the expensive tests?

4. Research and Development of Drugs and Medications: Drug companies are evil. At least that is the conventional wisdom. Yet, these drug companies save our lives. Research is expensive. Like technology, research and development has to be paid for, and the payment comes in the costs of new and better drug therapies. Prior to World War II, the only drugs we had were a handful of antibiotics, a few vaccines (small-pox, polio, etc), and a handful of other medications. Now, we have dozens of alternatives for any given ailment (including, should I add, ED?). These drugs are part of the reason that we have an ever increasing life-expectancy.

With all the railing against insurance companies, and government options, and the uninsured and rich doctors, the four items I've listed are the PRIMARY reason health care costs keep going up. Which one (or ones) of those four things do you want the government to step in and change (by force, if necessary) in order to drive health care costs down?


4 comments:

Jeff Stone March 10, 2010 at 12:36 AM  

A great thumbnail of all that is overlooked in this whole "Health" "Care" "Reform" argument.

Chuck March 10, 2010 at 7:28 AM  

Another significant cost is that we are keeping people alive longer. People in the hospital are sicker now because the people we are admitting now would have likely died 30 years ago. We can manage heart disease, lung disease, prolong life of cancer patients. These people cost more to treat and have to be treated more often and longer.

I am not suggesting death panels. I view the advance in medicine as a good thing, I view keeping people alive as a good thing.

Bottom line is if we are going to keep grandma alive, we have to pay for it.

WoFat March 10, 2010 at 9:06 AM  

The age-old con game; "Give me your money now and I'll triple it for you in the near future You can trust ME."

"This car? It's a wonderful automobile, only driven on weekends by an elderly school teacher."

Obammy is A Shammy March 10, 2010 at 10:20 AM  

How’s that for a definition of transparency?

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This blog is about my opinions and world view.  I am a conservative, evangelical Christian.  Generally speaking, if you post a comment, I'll allow you to express your view.  However, if you say something hateful, untruthful, or just generally something I don't like, I may remove it.

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