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Sun Aug 12, 2012, 02:15 AM

 

The Cost of Health-care

This is something I am very interested in at the moment. With all the debate that we have had about health-care costs, access to care, etc... I found myself wondering, just why is it that health-care costs in America are so expensive?

So, I've been doing some research. Now, most of these figures are fairly rough(i.e. rounded to the nearest 10%), but I've found some interesting things. You'll have to forgive me, as I don't have all of the sources I used to find these figures saved. What I want to do is understand why health-care costs so much, to better understand how we can fix the problem.

Now, the US leads the world in obesity rates, unfortunately. Obese people pay $1,500+ more per year more than non-obese people do, on average. If our incidence of obesity were the same as the OECD average, we would spend, collectively, $95 billion less per year.

The US leads(or nearly) the world in diabetes rates, and diabetics spend 2.3 times as much on health care than non-diabetics. If we control for our incidence of diabetes, we find that we overpay compared to the OECD average by $115 billion per year.

The US pays approximately double the price for branded prescription drugs compared with the OECD. Other countries use price controls, which creates a bit of a problem. Essentially, the money that goes into pharmaceutical research comes from the premiums these companies charge in the U.S. If we enacted similar price controls, it could reduce worldwide R&D by up to 75%. When compared to the OECD, we overpay on prescriptions by $125 billion per year. Now, some of this spending, I believe around 10%, is Direct-to-Consumer advertising. Whether or not this is a good thing isn't really something I wanted to look into at the moment, but I am aware that it is a large amount of money.

Surgeons, Doctors, and Nurses earn approximately double in the US compared to the OECD average. Two reasons for this I know of are the cost of malpractice insurance, and the cost of education. If the salaries of our health care professionals were on par with the OECD, we would save at least $220 billion per year.

The last area I looked at was traffic accidents. Traffic accident mortality rates in the US are about double the OECD average, and total accident rates are triple. This is another $100 billion per year above the OECD rate that we pay.

So, the 'overpayment' of Americans on health care for each category are as follows:
Obesity: $95 billion
Diabetes: $115 billion
Prescriptions: $125 billion
Salaries: $220 billion+
Traffic: $100 billion

Or $2,100 per person.

Interestingly, in 2006 the US was only $1900 per capita above the trend line($ spent on health care according to GDP per capita) for spending across countries.

So really, that's all I have so far, and I don't really know where to take it from here. Obviously, our collective health is a major concern.

26 replies, 3130 views

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Arrow 26 replies Author Time Post
Reply The Cost of Health-care (Original post)
fainaent Aug 2012 OP
elleng Aug 2012 #1
fainaent Aug 2012 #2
Yeah Its Spin Aug 2012 #3
fainaent Aug 2012 #5
liberalmuse Aug 2012 #4
LiberalAndProud Aug 2012 #6
piratefish08 Aug 2012 #7
Yeah Its Spin Aug 2012 #9
grantcart Aug 2012 #8
Bluerthanblue Aug 2012 #10
fainaent Aug 2012 #11
Scuba Aug 2012 #12
Warpy Aug 2012 #13
raccoon Aug 2012 #17
piratefish08 Aug 2012 #14
polly7 Aug 2012 #15
Blanks Aug 2012 #18
polly7 Aug 2012 #19
Blanks Aug 2012 #20
polly7 Aug 2012 #21
polly7 Aug 2012 #22
Blanks Aug 2012 #23
Blanks Aug 2012 #26
unapatriciated Aug 2012 #16
joeglow3 Aug 2012 #24
grantcart Aug 2012 #25

Response to fainaent (Original post)

Sun Aug 12, 2012, 02:37 AM

1. Promotion/advertising/marketing,

of pharmaceuticals, doctors and hospitals, and management of insurance companies and related matters, I expect, add a large amount.

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Response to elleng (Reply #1)

Sun Aug 12, 2012, 11:57 AM

2. Yeah, I don't know how much

 

those costs are, across so many industries. More research, anyone?

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Response to fainaent (Original post)

Sun Aug 12, 2012, 12:54 PM

3. Did you get this info from Romney dot com too?

 

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Response to Yeah Its Spin (Reply #3)

Sun Aug 12, 2012, 12:58 PM

5. No

 

I got information from the CDC, OECD, WHO, BLS, ADA, among others...

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Response to fainaent (Original post)

Sun Aug 12, 2012, 12:56 PM

4. Dude - research?

I did a little research myself. You've been copying and pasting all your posts from other parts of the web onto DU.

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Response to fainaent (Original post)

Sun Aug 12, 2012, 01:01 PM

6. About that R&D ...

http://www.huffingtonpost.com/2012/08/09/pharmaceutical-companies-marketing_n_1760380.html?utm_hp_ref=business
Prescription drug companies aren't putting a lot of resources toward new, groundbreaking medication, according to a recent report in BMJ, a medical journal based in London. Instead, it's more profitable for them to simply to create a bunch of products that are only slightly different from drugs already on the market, the reports authors said.

"

harmaceutical research and development turns out mostly minor variations on existing drugs," the authors write. "Sales from these drugs generate steady profits throughout the ups and downs of blockbusters coming off patents."

The authors go on to say that for every dollar pharmaceutical companies spend on "basic research," $19 goes toward promotion and marketing.




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Response to fainaent (Original post)

Sun Aug 12, 2012, 01:05 PM

7. the cost of healthcare is .14 cents per pizza. please don't overcomplicate the issue.

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Response to piratefish08 (Reply #7)

Sun Aug 12, 2012, 01:15 PM

9. Zactly

 

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Response to fainaent (Original post)

Sun Aug 12, 2012, 01:13 PM

8. There is a very easy answer to all of your concerns. Single Payer Universal health care





Interestingly, in 2006 the US was only $1900 per capita above the trend line($ spent on health care according to GDP per capita) for spending across countries.




You don't have any statistics so I don't know what right wing bullshit trumped up study you are trying to use but here are the facts.

Because the US has a completely unnecessary redundant 'health insurance' industry in between the patient and the doctor we are throwing hundreds of billions down the drain.

http://www.nationmaster.com/graph/hea_tot_exp_as_of_gdp-health-total-expenditure-gdp

As a percent of GDP the US is throwing away between 4 and 7 percent of its GDP compared to all of the other major developed Democracies.

The ACA proved this when it forced a cap on the MLR and billions of dollars are being sent back and not a single insurance company went bankrupt when they had to reduce their bloated MLR.

You repeat the stupidest right wing tallking points about the health care system when for example when you list medical malpractice as a major cost factor. Only two specialiaties face a significant malpractice cost OBGYN being the most effected and this could be handled with some minor reform. More to the point having more money spent on preventative care would reduce riskier treatments that lead to the kind of complicated care that opens up the possibility of malpractice.

But let's cut out all of your tepid bullshit.

All repeat all conservative political parties outside of the US support universal access to health care and their national health service. No one is advocating our system.

Three years ago I painstakingly proved this point by looking up every single political party in the other developed democracies.

http://journals.democraticunderground.com/grantcart/188

Let's just take the official statement from the Conservative Party of Canada



The Conservative Party of Canada has released its platform, which is committed to ensuring that all Canadians have access to timely, quality health care services regardless of their ability to pay. They say they are committed to a universal, publicly funded health care system that respects the five principles of the Canada Health Act and the Canadian Charter of Rights and Freedoms.




So it comes down to this basic understanding of ethics (which also happens to be more cost effective). Do you believe that all people should have full access to health services regardless of their ability to pay.

Now go take all of your ridiculous talk of traffic accidents and malpractice costs to the junior high table, because that is the level of the argument that you are making.

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Response to grantcart (Reply #8)

Sun Aug 12, 2012, 01:16 PM

10. -word!

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Response to grantcart (Reply #8)

Sun Aug 12, 2012, 01:17 PM

11. I won't bother getting the sources I used for these figures

 

...because I'll clearly just be shot down for them.

I want every citizen to have full access to healthcare.

But I'm not talking about access. I'm talking about costs. Do you really think that our obesity rate, for instance, doesn't contribute to our high spending on healthcare?

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Response to fainaent (Reply #11)

Sun Aug 12, 2012, 01:22 PM

12. Then you should advocate for Medicare for All. Medicare runs at far lower overhead than ....

... for-profit insurance, EVEN WHEN YOU DON'T COUNT THE PROFITS.

Of course the bad habits of Americans contribute to their health costs, just like the bad habits of Japanese, Lithuanians and Norwegians. That doesn't mean we shouldn't implement a single, national health plan.

Using our precious health care dollars to fatten the wallets of corporate for-profit insurance investors in London, Hong Kong and Tokyo isn't just bad fiscal policy, it's immoral.

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Response to fainaent (Reply #11)

Sun Aug 12, 2012, 01:26 PM

13. The people with the worst access have the most obesity.

Ever think about that one?

How about the loss in productivity because so many people are working with unnecessary pain and illness?

Ever think about that one?

How about the naked immorality of having only a few people able to see a doctor when they're sick, forcing the rest to stay sick?

Ever think about that one?

Or how about the public health risk of having people with easily prevented or treated illness keep on spreading it around?

Do you ever think of any of this?

Or are you so concerned with the fact that you might have to pay a dime in insurance premiums that won't go back into your own pocket that it drives you crazy?

That's where Republicans are, my friend. That's why sensible people are working to defeat every last one of them.

The solution is easy. Tax the rich. Raise the wage floor so people can afford to pay their premiums. Cut the Pentagon down to what other nations spend. Oh, and raise tariffs to parity with every single trading partner so that we're not supporting the whole third world plus China. Get our jobs back into this country because shipping + tariffs is too expensive.

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Response to Warpy (Reply #13)

Sun Aug 12, 2012, 04:42 PM

17. great post. nt

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Response to fainaent (Reply #11)

Sun Aug 12, 2012, 02:25 PM

14. you want everyone to have healthcare and Romney is a HUGE supporter of Israel's healthcare

system. he highly praised their system for having such a LOW cost compared to us in the US and for the citizenry having such a high rate of coverage.


why shouldn't we copy Israel's system?

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Response to fainaent (Reply #11)

Sun Aug 12, 2012, 02:45 PM

15. Obesity and diabetes are directly linked to poor access to good nutrition.

http://www.huffingtonpost.com/susan-blumenthal/poverty-obesity_b_1417417.html

To address this health crisis, attention must be focused on a key issue that lies at the core of the epidemic: the social inequities of obesity. A significant body of scientific evidence links poverty with higher rates of obesity. Findings from the National Health and Nutrition Examination Survey (NHANES), the most comprehensive study conducted thus far to document the nutritional status of the U.S. population, has found that low-income children and adolescents are more likely to be obese than their higher income counterparts . Additionally, reports have shown a higher prevalence of obesity among low-income adults. One study revealed that more than one-third of adults who earn less than $15,000 annually were obese, as compared to 25 percent of those who earn more than $50,000 a year . Visually, a compelling correlation emerges when comparing maps detailing poverty and obesity rates in the U.S. (See images below)


Major contributing factors to the disproportional impact of obesity on low income populations in America include the barriers faced by people living in poverty in accessing healthy foods, a lack of nutrition education, a dearth of safe environments for physical activity and recreation, and food marketing targeted to this population. Population level data have shown that diet quality follows a socioeconomic gradient. People with higher socioeconomic status (SES) are more likely to consume whole grains, lean meats, fish, low-fat dairy products, and fresh vegetables and fruit. In contrast, lower SES is associated with the consumption of more refined grains and added fats .

Simply stated, families with limited economic resources may turn to food with poor nutritional quality because it is cheaper and more accessible . Lack of physical activity is another commonly-cited problem fueling the obesity epidemic in America. Some low-income families live in neighborhoods where it is dangerous to play outside, reducing opportunities for both children and adults to exercise . Furthermore, many low-income communities lack access to fresh and nutritious food. Instead of a supermarket, these neighborhoods may have an abundance of fast-food retailers and corner stores that are stocked with products high in fat and low in nutrients . Additionally, low-income families are often targeted by food marketers with advertisements encouraging the consumption of nutrient-poor foods. In this environment, children in low-income families are especially hard hit, as evidence demonstrates that consistent exposure to such advertising increases the likelihood of adopting unhealthy dietary practices .


This study also applies easily to Canadians, btw. http://www.hc-sc.gc.ca/hl-vs/iyh-vsv/life-vie/obes-eng.php

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Response to polly7 (Reply #15)

Mon Aug 13, 2012, 10:01 AM

18. ...and of course food comes from stores or drive through windows...

If we want to solve the diabetes/obesity problem in this country; we need to have food education in elementary school.

School lunches need to include foods grown in elementary school gardens. Children are more likely to eat vegetables if they played a role in growing them.

We need to get away from the idea that food comes from the store. Eggs come from the chickens that are in your yard to eat your food scraps and make fertilizer for your garden.

Children will eat fresh fruit and vegetables off the vine/tree/plant and we should put programs in place that encourage that. Already a significant amount of federal money goes toward school lunch programs; they should attach some additional strings and encourage food education more aggressively.

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Response to Blanks (Reply #18)

Mon Aug 13, 2012, 12:05 PM

19. Great points, I absolutely agree!

Those would be fantastic programs to get in place.

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Response to polly7 (Reply #19)

Mon Aug 13, 2012, 02:27 PM

20. Here's a TED video.

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Response to Blanks (Reply #20)

Mon Aug 13, 2012, 05:23 PM

21. I have to run for a bit here, but thank you for the video!

Will definitely watch it later.

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Response to Blanks (Reply #20)

Tue Aug 14, 2012, 02:14 AM

22. Wow.

That's an excellent video, she makes so many good points and is completely passionate about making a difference in children's nutrition. Recommended viewing for everyone. Thank you again!

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Response to polly7 (Reply #22)

Tue Aug 14, 2012, 09:43 AM

23. I know.

She addresses so many issues. It's hard to believe a little school lunch lady can make so much difference.

I think we've been throwing money at school for so long, and we really haven't given enough thought to where that money is going.

In this case a bunch of money is going to big companies to feed our kids 'stuff' that has as many nutrients as cardboard.

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Response to polly7 (Reply #19)

Wed Aug 15, 2012, 10:01 AM

26. Here's another TED video.



Just to show that it isn't an isolated incident.

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Response to fainaent (Reply #11)

Sun Aug 12, 2012, 03:55 PM

16. Your source as pointed out upthread leaves out the billions we give to Insurance CEO's.

I'm guessing the study you are using compares our health care cost with countries that use some type of universal single payor or socialized health care. Apples and Oranges. Please do not insult our inteligence when it comes to health care and costs. Many on this board are very educated on that subject. I have been involved in it since 1990.

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Response to grantcart (Reply #8)

Tue Aug 14, 2012, 09:57 AM

24. What is the field other than OBGYN with high premiums?

My sister-in-law in a perfusionist and when she graduated, she had to get her malpractice overseas, as no one in the US would even offer it.

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Response to joeglow3 (Reply #24)

Tue Aug 14, 2012, 11:57 AM

25. I am not sure but I think it was neurology

Just cannot remember

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