High US health care spending explained by its high material standard of living

The Atlantic ran an analysis of where the costs go:

https://www.theatlantic.com/magazine/archive/2009/09/how-ame...

Essentially, it's a mess of perverse incentives that are unintended side effects of heavy regulation.

Then apparently a full 75% (rather than the merely 62.5% I thought) of the WHO's scores are nonsense, and not indicative of health care quality.

We are all aware that the US spends a lot on healthcare. The article we are discussing provides a good explanation of why.

The fact that health care and health outcomes are minimally correlated is well known; see RAND, Oregon, and lots of non-RCT studies that generally fail to find much correlation (e.g. this one, which made the rounds recently https://jamanetwork.com/journals/jama/article-abstract/25135... ). I'm not sure what the relevance of that is to this article, however.

>I've talked to a few U.S. citizens that worked abroad who said healthcare in European countries is universally available but the demand outstrips the supply causing longer wait times to get treated than in the U.S. and that they prefer the U.S. system.

Whether we want to ration care by ability to pay or by another means, such as severity of illness, care will have to be rationed -- and the degree to which it must be rationed is inversely related to what percentage of people are covered by it.

So of course well-off folks will perceive a system with a greater percentage of people covered and with care rationed in a way other than 'ability to pay' as being worse than a capitalist system -- they have to wait longer because they're standing in line alongside folks who, in the healthcare system they are used to, could not afford to be standing in line with them at all.

The question is whether that drawback is worth providing access to care to folks who otherwise would not be able to access it.

This strikes me as circular logic. "The reason healthcare is expensive is because the US is expensive."

I have no problem with the idea of healthcare expenditures increasing proportionally to GDP because it's a luxury good. This is logical. I'll pay more to protect my life than widgets.

But I don't see the connection between this and the thesis:

>Now, to be clear, my position is not that we ought to be spending as much as we spend. My position is that the issues we face are very similar to the issues faced in Europe and other prosperous countries (and are generally similar to patterns many decades earlier). They are largely differences in degree, not kind. Our large apparent cost differences mostly originate from our significantly higher material standard of living. The long term increases found in the United States and other developed countries are generally a product of ever increasing material living conditions and varying levels of productivity in different economic sectors (healthcare being labor intensive and relatively high skilled at that). Despite the fact that all developed countries allocate a large and increasing share of their consumption expenditures on health care these these richer countries, including the United States, still spend more on other forms of consumption.

That sounds to me like the cost of our healthcare is ultimately up to the market, but that's not a thesis to fight for, as it's always a fact.

By using end result economic data like GPD or AIC to compare healthcare costs the analysis ignores the changing cost of inputs. Those rising costs should be linked to changes in business conditions.

Healthcare costs have been rising faster than inflation. And they have been rising faster than the material standard of living in the US. There are structural problems.