Albert Hunt today describes how the “success” of the health care bill will depend on whether it successfully “bends the cost curve” and slows the growth of U.S. health care spending. He makes many points that I disagree with in the piece, but what really bothered me was the whole idea that there should be a right or wrong amount for us to spend on health care.
Certainly there’s a problem with government’s health care costs climbing exponentially higher. Taxpayers have to foot the bill for all this health care, and as we know, when you buy things with someone else’s money you tend to spend a lot less frugally. That’s why the goal shouldn’t just be to cut a couple hundred of billion out of Medicare, but to change incentives so that people actually think about the health care they are consuming and if what they are doing makes sense.
We need to create a system in which money isn’t wasted on unnecessary tests and over-consumption of services (medical malpractice reform and health savings accounts are two policies that would help on that measure), and in which people receive good service for the money they spend. That’s why we need a more competitive health insurance marketplace (changing the tax laws and allowing for inter-state insurance purchases would be a good place to start) so that people can actually shop for insurance providers like they do for other products and services.
But the measure of any health care reform shouldn’t be whether it results in total health care spending being below some arbitrary threshold (like Al Hunt’s desired goal of 16 or 17 percent of GDP). After all, as we become richer as a society, it makes sense that we would want to use our resources to buy one of the few things that real matter-longer and healthier lives. One can only buy so many cars and electronics; you can only consume so much food and entertainment; our houses can only get so big. Health care is a piece of the pie that can continue to grow for good reason.
And let’s remember that big aggregate numbers like how much of our GDP we spend on health care is still largely a function of decisions made by millions of individuals. In America it should be nobody’s business but mine how much of my money I choose to spend on health care. At least, I hope that’s a point that we can all still agree upon.