Between 1996 and 2013, a study published this fall finds, the cost of health care in the United States increased by nearly $1 trillion. Now, a trillion might not sound like so much any more, since our Republican Congress has started throwing trillions out of the treasury into tax cuts. But for all of us paying for health care, it's kind of a big deal.
"Part of the reason we spend more on health care each year is the nation's growing and aging population," said Dr. Joseph Dieleman of the Institute for Health Metrics and Evaluation at the University of Washington and lead author of the study. "But factors relating to the health system, such as increased price, intensity, and utilization, are driving most of the spending increase."
Five factors contribute to the rise in health care costs in the US: (1) more people; (2) an aging population; (3) changes in disease prevalence or incidence; (4) increases in how often people use health care services; and (5) increases in the price and intensity of services. This research measures the impact of these different drivers on the total increase in health care spending and for the increases caused by specific health conditions and types of care. […]
"These findings offer insight into why the US spends so much on health care," said Dr. Jay Want, executive director of the Peterson Center on Healthcare, which funded the study. "Increased health care spending is driven more by how care is priced and delivered to patients than by the population's size or age. The research suggests the need for more efforts to address those forces that control pricing." [emphasis added]
The healthcare industry is profiting very well, thank you very much, even under the Affordable Care Act, which has done some work toward slowing down the increase in healthcare spending—the study doesn't include its effects because it doesn't include information after the law was enacted. But the fact that healthcare is priced is seemingly completely arbitrary hasn't changed under the law. There's been lots of ink spilled on the irrationality of our healthcare spending—why treatments and procedures can cost in the low thousands in one market into the tens of thousands in another.
There's pretty much one primary reason, and it's not because of an aging population. It's because there's a lot of money to be had in this system. We're a captive audience, those of us who have health insurance and need healthcare, and it's a notoriously difficult thing to shop around for. You've just broken your arm. Are you going to call around to the various hospitals to find out who will charge the least for setting your bones? That's an overused example perhaps, but healthcare consumption is really only an elastic thing when you absolutely can't afford it. It costs what it costs and you hope your insurance covers most of it—though your neighbor's insurance company may get an entirely different bill for the same procedure as yours did—and you get taken care of. And somewhere in between, someone is making a profit.
Now that Trump and his merry band of nihilists are destroying the only effort to do anything about the healthcare market that's been attempted since Medicaid was passed (and they're trying to destroy it, too!), we're going to have to get serious about fixing this when Democrats take the government back. Because otherwise we're going to go really broke. Democrats are going to take government back. Particularly if they run on making health care truly affordable and truly universal. Making them do that is one of the serious jobs we take on in 2018.