Tag Archives: Gross domestic product

It’s (at Least Partly) the Prices

I have previously written about the cost of health care in the United States.  As a society, we spend a lot more than any other “Western” countries with developed economies, regardless of whether one measures health care expenditures as a percentage of GDP or as a per capita figure.

Obviously, the amount of money spent on health care (or anything else, for that matter) depends on both the volume of services – how much stuff is done – and the unit price – how much each activity costs. A lot of attention has been paid (no pun intended) to the former, and with good reason. Continue reading It’s (at Least Partly) the Prices

U.S. Healthcare Costs & Benefits

Everybody recognizes that the United States spends considerably more on healthcare than other “western” countries do. It doesn’t matter if you look at per capita expenditure or percentage of GDP spent on health services, we rank at the top by a large margin. Of course, how much we spend is only part of the story. If, for example, we enjoyed better care and, as a consequence, better health, then one might conclude that all that “extra” money is worth it. The story line would be: we live in an affluent society, and we choose to spend a large portion of our wealth on healthcare to enjoy the added benefits of better health. Most observers have concluded, however, that we don’t enjoy better health than our western European friends, and so conclude that health care fails to deliver value – we are spending more than others, and not getting any measurable benefit. This is one of several arguments (I hope to address others in upcoming posts) for the need to lower health care expenditures in the US.

I agree that we spend more on healthcare than we need to, but it is important to consider that population health measures like life expectancy at birth, or rates of chronic disability, are poor measures of the value of our healthcare expenditures. Why? Continue reading U.S. Healthcare Costs & Benefits