Before we even think about whether government should take over more responsibility for health care and calculate the associated costs, there is much work to be done with the current system. That work could render billions in savings and lessen the physical and financial pain on patients and families.
For example, a new PricewaterhouseCoopers study found that wasteful spending in the health system is calculated at up to $1.2 trillion of the $2.2 trillion spent in the United States, more than half of all health spending. Defensive medicine, such as redundant, inappropriate or unnecessary tests and procedures, are the biggest area of excess, followed by inefficient healthcare administration and the cost of care necessitated by conditions such as obesity, which can be considered preventable by lifestyle changes.
PricewaterhouseCoopers’ paper classified health system inefficiencies into three “wastebaskets” that are driving up costs:
- Behavioral where individual behaviors are shown to lead to health problems, and have potential opportunities for earlier, non-medical interventions.
- Clinical where medical care itself is considered inappropriate, entailing overuse, misuse or under-use of particular interventions, missed opportunities for earlier interventions, and overt errors leading to quality problems for the patient, plus cost and rework.
- Operational where administrative or other business processes appear to add costs without creating value.
When added together, the opportunities for eliminating wasteful spending add up to as much as $1.2 trillion. The impact of issues such as non-adherence to medical advice and prescriptions, alcohol abuse, smoking and obesity are exponential, and fall into all three baskets.
Don C. Brunell, President (DonB@awb.org)
