Are we spending too much on health care?
Date posted: September 3, 2013
The numbers show that as a percent of our total income, the U. S. spends more on health care than any other country. Some people use this fact to say as a country that we overspend on health care and our goal should be to reduce this rate. Is this a debatable issue? N.C. State University economist Mike Walden responds.
“It’s a very much debatable issue. Now first of all, the fact that you stated is correct. We spend about 16 percent of our economy GDP on health care. The next highest country in the world spends 11 percent.
“So we’re well above other countries. And there is a debate about whether this is good or bad. People who are concerned about it say that perhaps this indicates we’re wasting a lot of health care spending. They worry about how much we spend on administrative costs. They worry about how much we spend caring for folks who are in the last maybe years or months of their lives versus spending money on preventative care.
“So there’s a lot of concern that that rate might be too high. On the other hand, there are people who say, ‘No, it’s very hard to determine waste.’ And they also argue that that 16 percent is at its level because the quality of care in the U.S. is much higher. People also get care faster. And that as we become an aging society, these folks say, it makes sense for people to want to spend more on health care.
“So we do have a debate here. I think it’s really at the crux of our debate about health care, and you really have to decide, Are we spending too much or are we spending what people want?”
Category: Economic Perspective