To put on a show for what this all might look like, a few weeks ago President Obama "invited" representatives from the major sectors of the health care business -- doctors, insurers, hospitals, pharmaceutical firms, medical device manufacturers -- to the White House to tell us all how much they would commit to lowering costs.
The result was a supposed commitment by these groups to cut costs by 1.5 percent per year.
Aside from the fact that shortly after the White House announcement, industry representatives began issuing statements denying that they made any such commitment, let's assume it's accurate. That these groups do not know how to run their own businesses and that they can deliver the same products and services annually for 1.5 percent less if the president threatens them.
At our annual health care bill of about $2.5 trillion dollars, savings of 1.5 percent would be about $40 billion.
Let's consider how much of our $2.5 trillion health care bill are costs resulting from behavior that individuals choose.
Googling around and totaling up, I come up with about $240 billion, about ten percent of our total health care bill. This is roughly the total reported health care costs associated with obesity, drug and alcohol abuse, sexually transmitted diseases, HIV/AIDS and sedentary life styles.
Worth noting is that these occur disproportionately in low income groups who get their health care free. More than half our spending on HIV/AIDS, for example, is out of Medicaid. Can it be accidental that the huge health care costs related to lifestyle issues are most pronounced where individuals do not personally bear the costs of how they behave?
How can our health care problems be solved by more entitlements and bureaucrats when this is what is causing the problem to begin with?
Viktor Frankl had it right. At the heart of the solution for our health care crisis is personal responsibility. This means more freedom and more markets.
|