10/10/2010

Tackle Cost Before Coverage

There are two health care crises in the U.S., one involving cost, the other coverage. It doesn't take a great deal of logic to realize that tackling the former will go a long way in addressing the latter. Unfortunately, Congress decided to focus on coverage, largely because it's much easier to offer people something they want (health insurance) than fight the entrenched interests who benefit from the outrageous cost of health care in the U.S.

Of course, to address cost, we must first understand why it costs so much here compared to the rest of the world (interesting tidbit - the U.S. government spends more per capita on health care than does Canada - and Canada has universal coverage). There are, of course, the usual suspects of malpractice suits, the defensive medicine in response, the use of emergency rooms for routine care and whatnot. But this represents little more than a few percent of our $2.2 trillion health care tab.

No, the reason for our outrageous costs can be summed up in one word: demand. We want health care and we've got the money to pay for it. It's a costly combination.