Why Health Care Costs So Much
July 01, 2013
To the Editor:
Regarding your editorial on end-of-life care and the findings of the Dartmouth Atlas, (“End-of-Life Care and Costs,” June 18) a few observations are in order about the continuing high cost of health care.
Some people blame overutilization, and by extension blame fee-for-service by saying that it encourages physicians to order more procedures. This is a straw man that needs to be put to rest. In Europe, with much lower costs per capita (and longer life expectancies) utilization rates are actually higher than in the United States. In Canada, where costs per capita are also much lower than the United States, fee-for-service is still common.
However, what every country in Europe has that we do not have is a system of universal insurance or publicly financed health care that guarantees access to everyone and also includes price controls. This is the same in Canada, Taiwan and Japan as well. By pooling funds in one way or other (usually through taxes), the state is able to regulate the price that will be paid for each procedure, and medical inflation is kept under control.
Also, many of these countries put their hospitals on a “global budget,” which means they pay for what is needed monthly or quarterly from the money that is pooled; this is certainly preferable to having hospitals charge for each and every bandage or pill.
A single-payer system would not only create universal access to care, it would also help control our high health-care costs. It would eliminate the excess paperwork created by our current patchwork system with insurance companies in the middle. It would also control prices. With one principal payer, providers would not be able to shift costs, with ever-rising prices the inevitable result. Finally, such a system makes budgeting easier, so that much of what goes on in hospitals could be paid for by a fixed global budget, just as we pay for police or fire departments.
Hopefully, we are on the road to implementing such a system in Vermont. Ultimately, this is also the only solution on the national level to quality universal care that is economically sustainable.