I see a few problems that increase costs above other countries in the U.S. system. Initially, we do not have price transparency. Some other posters have referred to this. We also have market fragmentation and isolation which is part of what I think jj was talking about earlier. I don’t care whether the model is Bismarck, Beveridge, or NHI, regulation prevents the sort of abuses that are endemic to the U.S. system. Our tests can cost more, our procedures can cost more, and the consumer has no way of getting apples to apples information. Other countries limit costs through using the purchasing power of the government, even if the insurance companies are private (Bismarck model).

Second, administrative costs are out of control. Other countries have administrative costs in the 2-5% range. I believe that is about what Medicare runs. But our private insurance sucks up much more of our ‘health care’ dollars. Those administrative costs run at about 17% trending up to 20%. They are dead dollar expenditures that do not improve quality of care at all.

Third, even outside of the ridiculous charges that can be tacked on by hospitals, or the shell games that insurance companies can play, costs are more because it is a simple fact that our doctors make more than those of most other countries. Part of this can be explained by the high cost of medical school, part by malpractice, but not all.

But speaking of malpractice, there is a certain amount of waste that is due to defensive medicine. Some other countries are a bit tighter on the types of suits that are allowed, and perhaps some type of relieve could be found from doing this.

I also believe that more discussion needs to be focused on end of life care and on incentivizing good preventative care. However, the first two issues especially are the ones that I see as providing the bulk of the problem. Any solution that fails to resolve those is doomed to failure.

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