Bargain Hunting For Affordable Care
Dean Baker makes an important point regarding health-care costs:
“The CBO projections imply an ever-growing disparity between the per-person cost of health care in the United States and the cost in other countries, a gap that might prove difficult to sustain given the ability of people to travel across national borders.”
Indeed, the fact is that Americans spend an enormous amount on health care with little to show for in the way of health outcomes. Considering just North America, data from the World Bank show that, on a per capita basis, health-care spending in the US is 1.6 times that in Canada and nearly 14 times that in Mexico. But in terms of life expectancy, Americans, on average, live about as long as Mexicans and slightly shorter than Canadians.
Source: World Bank (2010)
This gap cannot persist indefinitely. As the NYT reported back in June, thousands of Americans are already making the trip across Mexico’s boarder in search of affordable care. And if we are to believe the CBO’s horror projections on the trajectory of future health-care costs, then the flood of consumers across the boarder is only going to intensify.
We could, therefore, save Americans a lot of hassle by reforming healthcare in a way that actually lowers costs. Specifically, we could allow more foreign doctors to train up to US medical standards, thereby undercutting the pay of domestic doctors. (Salaries for general practitioners in the US are nearly twice as high as the average GP salary in other OECD countries.) And we could end the corrupt patent monopoly scheme that allows pharmaceutical companies to sell certain drugs as high as a thousand percent above free-market prices.
Or how bout this: Why don’t we just nationalize the entire sector, like many other developed nations have successfully done?
The plus side, I guess, is that if we don’t reform healthcare in a way that lowers costs, then the shoe industry is likely to boom – because Americans are going to be doing plenty of walking in the decades ahead.