Jeffrey Sachs, Director of the Earth Institute at Columbia University, recently stated that Republicans are focusing on Medicare as a place to cut government spending, when in fact Medicare represents only 3% of GDP, and the overall costs of health-care in total is more than 17% of GDP — which is the real problem.
The United States of America spends twice as much on health-care as a percentage of GDP than any other nation on earth, and the costs are going up faster than the rate of inflation. Spending on health-care in the economy has doubled over the last 30 years to a current level of over 17% of GDP. CBO estimates that this percentage will almost double again over the next 25 years to 31% of GDP.
The for-profit-health-care private sector is posting all-time record profits, and the Republican party wants to turn the health-care of older Americans over to who? — oh yeah, to the insurance companies!
If Medicare were to be privatized the health-care of our veterans could be next. Retirees and veterans would be at the mercy of insurance companies — truly vulnerable Americans. Would for-profit insurance companies really insure these Americans at reasonable costs when their profits would be lower with these groups?
Our country’s health-care system is wildly inefficient and wasteful. Economists have looked at the “why” of our expensive system and offered several theories: “The technology is expensive” — and it is, however France uses the same technology and their health-care costs are half of what ours our; “malpractice” and the costs associated with defensive medicine as a driver of cost — but economists found that this only adds 3% to the national health-care costs.
There is one other factor that is distinctive to American health-care and that is increasingly thought to add the most costs of all. That is the disjointed nature of the system. There are hundreds of different insurance plans in the United States, each with its own network of providers and terms of coverage. This makes it extremely difficult to coordinate care. Providers often fail to communicate with one another, which can lead to repeated tests and redundant treatments. Lack of coordination is one reason we lag behind many other developed countries in using electronic medical records. Our system contains few, if any, incentives for providers or insurers to try to overcome this inefficiency.
No one knows exactly how much more we pay because of the disjointed nature of the health care system, but it is clearly a large amount. The health reform law contains provisions that encourage greater coordination, but any impact will take time. Whatever the solution, we need it soon, before health-care costs place an insurmountable burden on individuals, government programs, and the overall economy. We can’t afford to keep paying premium prices and getting health outcomes that are mediocre at best.
The real hope for solving this bigger problem, the costs of health-care, most likely lie with the states. Vermont is enacting the nation’s first single-payer health-care system. And, this is how Canada’s national single-payer health-care system came to be: it started small in the regions, and ultimately was enacted nationally. If New York or California were to follow in Vermont’s footsteps it wouldn’t take too much imagination to think that the states of Washington, Oregon, and maybe even Nevada to do the same. When the states with single-payer systems demonstrate the cost savings and efficiencies inherent in these plans it would become harder for states like Texas and Mississippi to cling to our current for-profit system.
GO VERMONT GO!
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