Health Care Costs And Portfolio Allocation

USA health care spending continues to grow, consuming an ever increasing share of the economic production of the USA. USA health care spending is twice that of other rich countries for worse health care results.

This guest column by Secretary Locke was published in the Seattle Times on Friday.**********WHEN Republicans vote next week to repeal the Affordable Care Act, they are voting to repeal a new level of control that American families have over their health-care decisions. They are also voting to make American businesses less competitive in the global economy. Because just 10 months after its passage, the act has brought badly needed change to the American health-care system. The law: • Prevents children with pre-existing conditions from being denied coverage; • Eliminates lifetime caps on the dollar amount insurance companies will spend on enrollees' benefits, like cancer treatment; • Allows children to stay on their parents' insurance plans until they are 26; • Gives tax credits to small businesses to help them afford health care for their employees; and • Takes meaningful steps to lower costs and improve the quality of health care for all Americans But from my perspective as U.S. commerce secretary, one of the most important benefits of the law is that it will make American businesses more competitive by reining in rapidly increasing health-care costs. As President Obama has noted: "We are in a fierce competition among nations for the jobs and industries of the future." The Affordable Care Act will allow American businesses, large and small, to improve their performance against foreign competitors, most of whom have significantly lower health-care costs. The cost savings are real, and they will grow over time.

A pacemaker implant that might cost a patient $36,012 in one hospital, might cost $143,124 down the road at a different hospital –– in the same zip code. 

Mark McClellan is the director of the Engelberg Center for Health Care Reform at the Brookings Institution. Before that, he served on George W. Bush's Council of Economic Advisers.

Nominal health spending in the United States grew 4.4% in 2008, to $2.3 trillion or $7,681 per person. This was the slowest rate of growth since the Centers for Medicare & Medicaid Services started officially tracking expenditures in 1960, yet once again outpaced nominal GDP growth (2.6% in 2008). This brings health care spending to 16.2% of GDP. In 2003 the total health care spending was 15.3% of GDP.

By Dylan Matthews Patrick_M asks:

When the Congressional Budget Office assesses the cost of a bill, they look at mandatory effects. So if the bill says you have to give subsidies to everyone making less than $80,000, they figure out how much that is likely to cost and add it to the total. If the bill says you have to tax employer-provided insurance plans, they figure out how much that tax will raise and add it to the total. If the bill simply says that you can choose to fund something by taking another vote on it in the future, it doesn't enter the tally. It's a world of musts, not mays.