<p>"The total Medicare budget for FY '12 is $468 billion. That’s not chump change but it’s only about 12.6% of total federal spending. It provides health care for 47.5 million seniors and disabled persons, at an average annual cost of about $9800 per person. "</p>
<p>That also leaves out that medicare spending is increasing at a rapid rate and represents the second largest discretionary spending line in the federal budget behind defense (also bloated and also politically difficult). What that also leaves is the hidden cost of medicare, the number above is what medicare pays out. What that doesn’t talk about is the amount of cost shifting that goes on in medicine that helps subsidize medicare and the uninsured. When medicare pays 100 bucks for a procedure that costs 200 bucks to do, hospitals and doctors routinely add to the cost of private insurance patients to pay for it (for example, someone cited a medication that cost 800 bucks being billed at 3800, that is a classic example, or an aspiring costing less then a dollar being billed at 20). Those ‘cost savings’ in medicare come at the expense of others, in effect we pay not only a medicare payroll tax, but also in effect a de factor ‘medicare surcharge’ when we get healthcare from hospitals and doctors who take medicare (and obviously, same applies to medicaid and the uninsured)</p>
<p>I agree with mini, there are answers to the problems with health care, but there is no magic bullet that everyone seeks. For example, one of the reasons health insurance has soared (as have other types of insurance) is insurance companies have changed their business models. Insurance companies used to take the money they get in premiums and invest it in markets and such, and they made most of their profits from the investments, typical difference between premiums gathered and payouts was roughly 10% back then or less…today insurers are building cushions of 20% or more, and to do so they not only have restricted payouts, they also have raised premiums aggressively, and despite all the blather about lawsuits and so forth, the reality is they did so because financial markets were not giving them returns (want some proof? California put caps on payouts on malpractice suits, and malpractice insurance premiums have continued to soar there…). The head of United Health Care a couple of years ago had compensation of 100 million dollars.</p>
<p>Others have made very valid observations about the current health care system and it needs re-evaluating all the way down. The employer paid health insurance system, for example, is burdening employers with rapidly escalating premiums something companies in places like Canada don’t have or Europe, and it also gives employees very little control over their health care decisions, most companies for example have few if any options when it comes to medical insurance, you take what they have. Another problem (part of the problem with the health insurance companies competing with each other, across state lines, whatever) is the industry is capital intensive, and the number of companies able to enter the market is small, these days there basically are a handful of health insurers. On the treatment side of things, things like MRI’s, CAT scans and the like are expensive, and continue to be with upgrades and such, so there is huge incentive to use them on as many people as possible, so you get people being given MRI’s and such who shouldn’t be…and the list goes on, the problem with the current system is there is no rational basis for a lot of it, it is haphazard, disconnected from each other and so forth.</p>
<p>Want a big example? Take a look at preventative medicine. Medicine today is as it has been for a long time, it is on treatment of disease, not preventing it. I just had a physical exam, it lasted about 15 minutes, and hasn’t changed since the dark ages, and really tests very little. Likewise, we don’t do a good job with nutritional counseling or with preventative things like supplements and vitamins (though some doctors have started to use them, especially when many of them figured out they could get a piece of the action with the products patients buy). Employers pay huge health care premiums, yet they do little to encourage employee health (subsidize gym memberships, on site gyms for big companies, employee cafeterias), and this has especially gotten worse now that people are working much longer hours, and the list goes on. The government subsidy programs to farmers and food producers often encourage the very things that make us less healthy, cheap processed food (high fructose corn syrup anyone?), hormone and antibiotic laced meat, you name it. We spend money on vaccinations, but we don’t spend it on the other factors that cause issues, many of which are lifestyle…We also have things like allowing pharm companies to heavily advertise products, which leads to people going into their doctor and saying “I want X, on the ad they say it is the best” when another drug might do just as well, but people believe advertising (for example, there are natural alternatives to Viagra and Cialis that have been proven to work, but MD’s will prescribe the expensive, lucrative drugs). When you have such a disconnected market as we do it leads to all kinds of waste, duplicated effort and also it leads to the kind of things where someone goes into the ER for a couple of stitches and ends up with a 5k bill. </p>
<p>And yes, this is difficult,people have been complaining about the health care system for years, I was debating it 30 years ago in High School, and very little real change has happened, there are all kind of political and moral issues we don’t want to deal with. Want a classic example? When Obama was proposing his health care initiatives, people at Tea Party rallies with their signs “No Socialized Medicine” and on the other side “Government, hands off my Medicare”, it tells the story in a nutshell.</p>