Sunday, May 20, 2018

Why are US Healthcare Costs So High and What Can We Do about it?

Frequently, there are stories in the news related to the rising US healthcare costs, and the low quality of US healthcare compared to many other industrialized countries. It is often stated that US healthcare costs are high because of over utilization of healthcare services. But one study questions the validity of the over-utilization assertion as a reason for the high costs. Also, one approach to lowering the cost of healthcare in the US is gaining momentum. The approach is to form partnerships between healthcare organizations and community organizations to deliver healthcare services.

In 2014, The Commonwealth fund, a private organization that promotes high-quality healthcare, concluded that the US had the worst healthcare system among 11 developed nations. These nations were the United Kingdom, Switzerland, Norway, Sweden, New Zealand, the Netherlands, Canada, France, Australia, Germany, and the United States. Not only is US healthcare quality a problem, but the high cost of healthcare in the US is also a great concern.

So the US healthcare quality is poor and the cost is high. But is the cost high because of over healthcare utilization? At least one study concludes that the answer is no. The investigators assert that healthcare providers in the US are paid too much. US healthcare providers are paid twice as much as providers in some other countries.

Now some experts would argue that providers are paid more in the US because of the physicians' medical school debt. But according to the above-mentioned study, this is not the case. The investigators indicated that “taking into account tuition costs didn’t explain the difference in earnings.” This might mean that healthcare providers’ salaries should be lowered and that less expensive providers should be sought in many instances.

This also might mean that the move by some healthcare organizations to lower costs and improve outcomes by aligning themselves with community organizations might be a promising approach to the US healthcare cost and, perhaps, the quality problems. Medicare, for example, is partnering with the YMCA and other organizations to provide a diabetes prevention program (MDPP). The approach used to deliver the prevention program has been shown to be effective and less costly than the treatment offered in the normal clinical environment.

Partnerships between healthcare organizations and community organizations may be feasible for other illnesses – especially in the treatment of chronic illnesses such as obesity. In fact, the CDC is suggesting that more research be directed at community programs, such as Weight Watchers and Jenny Craig along with randomized controlled trials (RCTs), to come up with practical methods for dealing with overweight and obesity.


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