The problem with directing policy towards the healthy (if you want to save money)

Via Aaron Carroll and The Incidental Economist, there isn’t very much ‘low-hanging fruit’ in health care spending to save on expenditures if you only advocate policies that affect the healthy:

 

Carroll:

When we talk about incentivizing people to forego care, we’re talking mostly about healthy people. When we talk about consumer directed health care, we’re talking mostly about healthy people. We don’t want sick people to avoid care. We want to stop healthy people from consuming it. The problem is that healthy people consume so little care to begin with.

Health Savings Accounts? Directed towards healthy people. Other demand-side ‘solutions’ that include increased cost-sharing? Directed towards healthy people. Selling health insurance across state lines? Companies design, and innovate, their best polices for those who spend the least – thus, directed towards healthy people. These are all ‘skin in the game’ initiatives that masquerade as solutions to spiraling costs. When five percent of spenders (as Carroll notes, the sickest among us) account for nearly half of health care expenditures, the above policies don’t affect them at all. That’s not a direction towards cost savings, that’s a direction towards ignorance.

About these ads

About David Phillippe

Married father of one.

Posted on July 31, 2012, in Graphs, Main and tagged , , , , , , , . Bookmark the permalink. 2 Comments.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Follow

Get every new post delivered to your Inbox.

Join 361 other followers

%d bloggers like this: