We now begin the magazine’s second calendar year. We shall summarize what was reviewed in the early part of the magazine.
The US spends $4.5 trillion/year on healthcare or $13,493/person(2022) each year, the highest cost per capita of any developed country in the world. The next highest country, Switzerland, spends approximately 30% less. This is very sad, especially when one notes our country’s low life expectancy as compared to other first world countries. Indeed, in spite of spending the most per citizen/year, the US ranks 48th in life expectancy when compared to the countries of the world. For comparison, our northern neighbor, Canada, ranks 20th in life expectancy.
Not mentioned explicitly in our previous discussions but worth inserting at this point is the following: in constant US dollars, healthcare cost/person/year have only accelerated over the last 50 years (from circa $2500 in 1974 to circa $14,000 in 2024).
The founder of this magazine asserts that 50% (at least) of money spent for healthcare is redundant, wasteful, or otherwise unnecessary after watching this Rube Goldberg-esque system for 40 years.
Instead of a flexible healthcare system which allows for all Americans a PCP who can prevent or intervene early (which is most satisfactory for the patient and simultaneously the most cost-effective approach), our “universal healthcare” is often the overburdened emergency room. The ER by its nature is the least cost-effective arm of the medical system, especially for medical issues which should have been addressed as an outpatient.
Because of misaligned incentives, large entities such as hospitals and others motivate/coerce physicians to offer unnecessary care for patients because of strong financial inducements to the entities (e.g., E.R. physicians are encouraged to admit patients to the hospital without just cause to make money for the hospitals, not for the patient’s benefit).
The prescription pharmaceutical industry and large commercial pharmacies are absolutely opaque in their pricing schemes. In a country valuing fair market competition, these large entities make purchasing a generic prescription 10 times more costly in one circumstance over another. The example offered was atorvastatin at $4/pill vs. $0.30/pill at the same pharmacy if one simply knows about free coupons. Just this 1 generic medication alone, it was estimated, led to an overcharge of $4.7 billion in the US for just 1 year. The free market model is failing in this arena.
We introduced a Markovian model (in which patients “jump” from a healthy state on the left side of a diagram to less healthy states on the right) as a framework for studying health systems and the timing of their interventions. This gives some reproducibility and rigor to our descriptions and modeling.
We discussed 4 critical health measures which promote an understanding of our health status and concrete targets to improve this (e.g., BMI, fasting glucose/HgA1c, cholesterol, and blood pressure).
Also discussed a bit later in the year was the idea that fitness is a uniquely good predictor of healthcare costs. Specifically, the more fit a person is, the less healthcare dollars one needs. Put another way, as one became more aerobically fit, one stays healthier and independent longer and would need on average fewer healthcare dollars. Unfortunately, US citizens grow increasingly unfit and heavier year after year.
Medical information in the United States is hopelessly strewn across multiple locations and platforms for all Americans. Some systems still use paper and others are recorded on computer. Records on different computers are often mutually incompatible. Images such as MRIs, CAT scans, and the like are rarely easily retrievable. Laws enacted to protect privacy of medical information on the one hand, hinder the interchange of information on the other.
Although some progress has been made, tens of millions of Americans have no healthcare insurance at all, none. Those who do have some form of insurance often hesitate to use it because of co-pays, withholds, and deductibles which make them the “underinsured”.
Increasingly, physicians want to work for entities with which they have a conflict of interest (e.g., working for a hospital while taking care of patients immediately raises red flags). To the best of this author’s knowledge, there is no consistent code of behavior for physicians whose practices are controlled by other entities, e.g. hospitals.
All in all, we have a medical system that costs more than any other in the world with little to show for it. Health insurance for the entire citizenry is unavailable. Quality of care and cost-effectiveness are suboptimal. The author of this piece has marveled for decades at how increasingly enfeebled our system has become with only the shrugging of shoulders as a reaction. Our national leadership has been feckless.
However, as noted previously, much can be done to fix the medical system from the ground up and align the incentives. This is reviewed in the next article.