Has the Cost Curve Already Bent?
This is Jeff Goldsmith at the Health Affairs blog:
The rate of health cost growth in the United States had been reduced almost by half in just four years. The cost curve has been bent by the absolute burden which health costs represent for American families and businesses. The real problem is that we simply cannot afford the health system we have.
The alternative explanation is that consumer-driven health care is allowing people to spend money on other things and that supply-side innovations (1,000 walk-in clinics, e.g.) are helping them.
Goldsmith is a third party payer guy. He believes in bureaucracy.
John, I like your explanation better thn Goldsmith’s explanation.
I not only like John’s explanation better, it is more likely to be true.
I think Neil is right. Goldsmith doesn’t believe in consumer directed health care.
So both acceleration and deceleration in rate of growth are cause for alarm? I wish they’d make up their minds.
I hate to disturb this mutual admiration society, but the reason for the “bending” of the cost curve is simply that people can’t afford needed care.
First, the blog article discusses how the cost of medical care increased by only 4.4% during 2008. That still widely outpaces inflation, which was negative in 2008. So, in a year where all other expenses went down, the cost of medical care went up.
Second, the idea that 1,000 walk in clinics could have any effect on medical costs is pure fantasy. First, the American public rightly wants to see “their” doctor. Without having a doctor who knows you and your medical issues, you can’t have the most important element of quality of care, continuity of care. Walk in clinics can’t provide continuity of care. There are some 800,000 physicians in the US. Even if walk in clinics charged zero, their effect on medical care costs would be immeasurably small.
Third, there have been good studies showing the number of prescriptions filled has gone down during the recent and continuing recession. That’s not because the population has gone down or that we have become healthier, it’s because people can no longer afford needed medication.