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May 2011 final
The document discusses challenges facing the US healthcare system. It notes that while there is a crisis in healthcare financing, rising costs are driven by both increasing prices and quantities of healthcare consumed. International comparisons show the US spends a much larger share of GDP on healthcare than other countries. Reforming the system to control costs will be an ongoing challenge for the foreseeable future.
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May 2011 final
- 1. Economic Indicators:Challenges forthe 7 Rivers Region
- 2. Standard Disclaimer:I hardlyhave any idea about what I might say today, so of course my employer and the sponsors are not liable for what comes out of my mouth.
- 3.
- 5. Do we havea health care crisis? We have a financing of health care crisis.
- 10. National Compensation Measuresas a Share of GDP, NIPA 1960-2006Private Group Health Insurance56.4% of GDP56.3% of GDPOther Fringe Benefits and Payroll Taxes3.8%6.7%0.6%4.1%Wages51.8%45.6%2006Source: Kaiser Family Foundation analysis of data from the U.S. Department of Commerce, Bureau of Economic Analysis, National Income and Product Accounts, 1960-2006, Tables 1.1.5, 2.1, 6.11B, 6.11C, & 6.11D, 2008.
- 11. Employer Based InsuranceEmployeeContributions IncreasingHigher DeductiblesLower Wage Growth
- 15. The rise ofcorporate wellness programs.
- 16. Can we reinin the growth of health care costs?
- 17. Costs?Expenditures = PriceX Quantity
- 18. Can we reinin the growth of health care expenditures?Not Likely.
- 19. The Race toDeathCancerHeart DiseaseStrokeDiabetesCar Accident
- 20. The Race toDeathXCancerHeart DiseaseStrokeDiabetesCar Accident
- 21. The Race toDeathCancerXHeart DiseaseStrokeDiabetesCar Accident
- 22. “Cut half ofall medical spending”~Robin Hanson
- 23. Can’t Trust theConsumersWe have a “do something” bias.And we don’t use information provided.
- 27.
- 28. “If something can'tgo on forever, it won't.“~Herb Stein
- 29. We will bedoing Health Care reform for the rest of our lives.~ Former CBO Director Doug Holtz-Eakin
- 30. Sorry to besuch a downer. Thanks.
Editor's Notes
- #5 http://www.flickr.com/photos/52421717@N00/5477782480/sizes/o/in/photostream/This had at its heart two issues, the provision of public health benefits and the financing of them..medicaid is squeezing the budget, and the health benefits of public employees squeezing the employer.
- #6 I’m not convinced we have a health care crisis, but I do believe the way we finance health care has led and is leading to a crisis. The Madison protests are the first bit of evidence, followed by the over the debt ceiling. We finance health care 50% through taxes, about 50% privately of which 65% (30%) is employer based insurance, 25% out of pocket, 15% philanthropy.
- #7 CBO projections
- #9 CBO projections
- #10 Source: C. Eugene Steuerle and Stephanie Rennane The Urban Institute Benefits $35,000 $132,000 $343,000 $530,000 Taxes $0 $7,800 $55,000 $84,000 Present value inflation adjusted.
- #13 http://www.minneapolisfed.org/publications_papers/pub_display.cfm?id=4651
- #14 http://www.minneapolisfed.org/publications_papers/pub_display.cfm?id=4651
- #15 http://www.minneapolisfed.org/publications_papers/pub_display.cfm?id=4651
- #19 We might not be able to reduce expenditures, but we can improve outcomes.
- #20 http://www.flickr.com/photos/childofwar/3341613458/sizes/z/in/photostream/Curing cancer doesn’t do anything for longevity. Adds to health expenditures. Cure heart disease and you increase longevity, but you will die of something so we will not lower expenditures.
- #21 http://www.flickr.com/photos/childofwar/3341613458/sizes/z/in/photostream/Curing cancer doesn’t do anything for longevity. Adds to health expenditures. Cure heart disease and you increase longevity, but you will die of something so we will not lower expenditures.
- #22 http://www.flickr.com/photos/childofwar/3341613458/sizes/z/in/photostream/Curing heart disease adds longevity, but doesn’t necessarily reduce expenditures because diabetes and cancer are around the corner. Cure heart disease and you increase longevity, but you will die of something so we will not lower expenditures.
- #23 Easy decision ex-post, more difficult ex-ante.
- #24 http://modeledbehavior.com/2011/02/19/overtreatment-in-america-this-time-patients-killing-themselves/CONCLUSIONS: Faced with hypothetical cancer diagnoses, many people say they would pursue treatment even if doing so would increase their chance of death. This tendency toward active treatment is notably stronger when the treatment offered is surgery instead of medication. Our study suggests that few people can imagine standing by and doing nothing after being diagnosed with cancer, and it should serve to remind clinicians that, for many patients, the best treatment alternative may not only depend on the medical outcomes they can expect to experience but also on whether those outcomes are achieved actively or passively.http://modeledbehavior.com/2011/04/23/the-us-health-care-system-is-the-most-efficient-in-the-world/Studies were selected by conducting database searches in Medline and Healthstar to identify papers published since 1995 in peer-review journals pertaining to consumer report cards on health care. The evidence indicates that consumer report cards do not make a difference in decision making, improvement of quality, or competition.
- #26 http://www.scottwinship.com/1/post/2009/7/that-veterinarian-services-vs-health-spending-chart.htmlAccording to Andrew Biggs http://blog.american.com/?p=2991This again highlights that the real issue with healthcare may not be the rate of growth but the level of health spending—and the fact that so much of it seems to be wasteful. This distinction is important because it shapes our policy priorities. The level of spending has different causes than the rate of growth of spending, among them our healthcare system’s structural incentives to overspend. Rather than attempting merely to temper cost growth, plans that remove incentives for overspending, improve consumer choice, or pay doctors based on quality rather than quantity of service could reduce the overall level of spending.--However I disagree. While it might be true half of all healthcare spending is wasteful, we only figure that out – for the most part – ex-post.
- #27 There are cost controls, but they have been weakened (excise tax on cadillac plans). Independent Payment Advisory board. Accountable Care Organizations.