Copyright 2009 by Vitalogy Membership Services. All rights reserved

The Cost Of Health Care Part 1  It's pretty much common knowledge that our current health care expenditures are rising dangerously high. For most of us, our last doctor bill is proof of that experience. As health care costs increase, a greater portion of our individual and collective resources gets spent. The total cost of our nation's health care is now over 16% of the gross national product. The average daily cost for healthcare in the United States is now over $1 billion a day, and it is rising. Of the major issues regarding our economy, none come close to the potential economic calamity of our nation’s health care costs. It won’t be baby boomers that bankrupt our economy long-term. It will be health care costs. Many areas of healthcare have far surpassed the general inflationary rate. At the same time, the level of the health care that is being delivered gets better and better due to continuous advancements with technology. This all costs more. Too often we don’t think we are paying because an insurance company or somebody else is. Perhaps our employers pay for all or part of our medical expenses, though the truth is, as consumers we ultimately pay for these costs. As costs rise, so do efforts to bring in the revenues needed to pay for these costs. Taxes are increased to support Medicare and state-sponsored health care services. Health insurance premiums continue to rise, along with the cost paid by individuals, to cover what insurance does not. So, salary increases are either smaller or nonexistent whatsoever, because of the need to compensate for increased cost of health insurance. Private health-care costs increase to offset the cost of Medicare and other government programs. A major reason for personal bankruptcies in the United States today is expenses related to illness. And, getting back to the social and financial ramifications of life support systems, understand that economically speaking, for a person to spend even a few days or weeks prior to their death on life-support systems, just those costs alone are substantial. Over 25% of the entire yearly Medicare budget covers a patient's last year of life. Of that, 50% goes for the last two months of life. Because it always takes two to tango, the healthcare industry is not fully to blame. We the public have long avoided confronting health care costs, feeling that medical care should be the right of each citizen. But as the costs and evolution of that medical care continues, serious decisions will have to be made. Healthcare is the only market commodity for which the person paying for it, the person using it, and the person providing it have an indirect rather than direct relationship. Let's take a hypothetical example of health care in the 1980’s and 1990’s. John Doe is an employee. When he gets sick, he visits the doctor. The fees the doctor charges are paid for by John's insurance. Insurance is paid for by John's employer.

Copyright 2009 by Vitalogy Membership Services. All rights reserved

The employer is the person paying the bill. But the employer is not the recipient of the services rendered by the doctor. This situation means no one is directly accountable for the costs and services involved. Employers do not directly dispense or receive health care. They have little control over it therefore. Neither the patient nor the doctor is too concerned, because someone else, the employer, is paying for it. Many people falsely think that not having to pay the doctor bill means free medical care. Not so. Today, healthcare costs are a major portion of benefits provided to employees. Starbucks now pays more for employee health insurance than it does to buy the coffee it serves its customers. Costs rise because responsibility for the health of the patient is taken out of the patient’s hands. Responsibility has been given to a third party, the healthcare provider, with a carte blanche expense account charged to the insurance company and paid for by the employer. Without a direct line of accountability concerning expenses, the cost of healthcare spirals upward. The doctor has no incentive to charge less. Little money is received directly from the employee. Services are rendered to one party and paid for by another. The doctor and the patient make decisions without direct accountability for the cost. This model is fast disappearing as it is unsustainable. There are other financial aspects of healthcare today. Consider the number of lawsuits against doctors. When you factor in a typical doctor spending over $100,000 a year on malpractice insurance, that's before he or she rents any space, hires their staff, buys equipment and the direct costs of actually treating patients… we’re talking overhead city. This is after the doctor typically begins their practice $200 to $300 thousand dollars in debt due to student loans. Our litigious happy society results in three times as many lawsuits being filed today in the US then were filed 10 years ago. As technology improves and gets even more complicated, the possibility, no probability of something going wrong then goes up exponentially. We as consumers are asking doctors, those entrusted to manage all this technology, to do more and be accountable for more. Also, don’t they deserve to be adequately compensated for having such a serious and demanding type of job? For most of us, screwing up at work does not involve a lawsuit. For doctors, that's a 24/7 problem. When patients ask why all these tests, part of the answer is that doctors have to protect themselves from lawsuits. So there is a fine line between negligence on the part of the doctor, the patient's culpability for being in the position they were in to begin with, unforeseen complications, and technology endlessly pushing the window.