This on health care expenses. I wanted to put the whole article here but in fairness you should read it on the Washington Post site. “There is a relatively modest and stable projection for 2006 to 2016, with an average growth rate of 6.9 percent,” Medicynical note: Huh?? 6.9%/year is not modest!!
“Karen Davis, president of the Commonwealth Fund. “There was a lot of feeling when the 2006 numbers came out and we were growing at about 7 percent a year, that maybe it wasn’t a continuing problem. But, I think even growing at 7 percent a year you see that by 2016 we are going to be spending 20 percent of the nation’s economy on health care.”
On drugs the data shows an almost 7% increase. Compare this with inflation.
“That (Medicare D) has helped hold down prices even as more seniors are able to get drugs, John A. Poisal of the CMS said in a briefing. National spending on prescription drugs was expected to rise to $214 billion in 2006, from $201 billion in 2005. But that increase is 0.4 percentage points less than it would have been without the new drug benefit, he said.”
“U.S. Labour Department–“Medical care costs rose 0.8 percent in January and are 4.3 per cent higher than a year ago. The index for medical care commodities prescription drugs, nonprescription drugs, and medical supplies-increased 0.6 percent. The index for medical care services advanced 0.9 percent.” On an annual basis, in fact, American health care costs are rising faster than any other set of prices in the economy.”
Suffice it to say the news is depressing, not reassuring. An increase in prices of 4.3% is twice inflation, add this price increase to the increase in demand for care of 6-7%/year and you may start to understand the problem. Prices and demand are increasing. Unless something is done we will literally eat ourselves alive–and really need health care. This is particularly alarming since we already outspend the world for healthcare by 50-100%. As I noted a few days ago, if we were a company we’d be criticized for being wasteful and inefficent and non-competitive with our comparators. We need a cost revolution in health care