Opinion: Our unsustainable health-care system

May 1, 2008

Health care in America is far too expensive; reform will require sacrifices from doctors, hospitals, lawyers, patients, and insurance companies.

American physicians-indeed, all participants in the US health-care system-have been trained and have practiced their profession during the most massive transfer of resources into a single sector, health care, than any society has seen outside war." -Richard Lamm.1

US health-care spending is unsustainable

One could argue that if the American people want to spend a fifth of their wealth on health care, why shouldn't they? There are two problems with this line of reasoning:

1. None of our industrial competitors burden their economies or industries with such costs; and

2. We are not getting our money's worth.

In 1980, the United States had the highest level of health-care spending per capita in the world. Over the next 25 years, the share of GDP devoted to health care in the US has grown from 8.8% in 1980 to just over 16% in 2007. More than a third of these costs were borne by US companies who provide insurance for 60% of the population. By contrast, given their nations' national health systems, virtually none of our foreign industrial competitors are so burdened. And while we now spend 50% to 100% more than other industrialized nations on health care, we rank 37th (behind Costa Rica) in terms of the performance of our health-care delivery system, according to the World Health Organization.2 The WHO's assessment is based on five indicators: overall population health, health disparities, health system responsiveness (i.e., patient satisfaction and how well the system performs), universal access, and financial burden. We badly lag in each category.