health economics pp t
TRANSCRIPT
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Healthcare EconomicsIs it all just dollars and cents?
19 April 2009
James S Eadie MD, FACEPCo-Chair, ACEP FGA CommitteeGSACEP, Immediate Past President
Academic Faculty, Wilford Hall Medical Center,San Antonio, Texas
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Overview
1. How much does the US spend on
health care?
2. Where do the dollars go?3. How fast are the costs growing?
4. What can be done to contain the
costs?5. Is the system really at a crisis?
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Economics..ouch
Why do we need to study economics?
Id rather be herding cats.
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Health Care Economics 101 Quiz
How much did the US pay for health
care in 2007?
What is the % GDP spent on healthcare?
What are the most expensive parts of
the health care system?
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Health Care Spending2007
>$2.2Trillion dollars
16.2% of GDP, Switzerland next highest 11.4%
$7,421 per living person Spending rose 6.1% (inflation 4.1%)
Spending is driven by new medical treatments,
rising prices and growing utilization.
Smith et al.Health Affairs Jan 2006
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US Healthcare = French Economy
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Percent Health Care of GDP 2006
data from WHO http://www.who.int/en/
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Expenditures per Capita 2006
data from WHO http://www.who.int/en/
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Per Capita Health Spending in 2006
Source: McKinsey Global Institute and NEJM 2009
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WHO Health Care Rankings
1. France
18. England
25. Germany
30. Canada
36. Costa Rica37. United States
38. Slovenia
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Health Comparisons
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Health Care Spending - 2006
Hospital Care
31%of total health care expenditures
$648.2 billion
Physician Payment
21%of total health care expenditures $447.6 billion
Growth from inc. office visits and imaging
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Health Care Spending - 2006
Prescription drugs
10%of total expenditures
Total: $216.7 billion * greater than nursing homes and home
health care combined ($177.6 billion)
Health Insurance Admin Costs(private + Gov)
- $204.1 billion
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Health Care Spending - 2006
Medicare
$401.3 billion
19%of national health expenditures Revenue
65% from payroll taxes and premiums
35% from general taxes
Key: this competes with Gov. spending
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Health Care Spending - 2006
Medicaid
$310.6 billion
15% of national health expenditures > 20% state budgets
SCHIP $ 8 billion
Federal Government pays over 46%Health care bills
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Federal Budget 2008
Federal Budget 2008 2.979 Trilliondollars
Social Security 612 billon
Medicare/Medicaid 682 billion
Defense 613 billion
Education 59 billionDebt Interest 249 billion
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Federal Spending FY 2008
Source: Congressional Budget Office
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US Federal Spending
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Federal ReceiptsFY 2008
Source: Congressional Budget Office
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Projected Growth
Health Care Projected Growth Rates 6.2% annually through 2018
16.2% GDP2007to 20.3%GDP2018
Public Payers
2016will be largest source of funding
2018over half of all health care spending
Why?
Baby Boomers76 M
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Projected Growth
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Health Care ReformIs it Possible?
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Health Care Timeline
1930s70sPhysicians /
AMA Strong
Pre-1880Physicians limited
authority
Progressive Era1910 - 17
18801920Industrial Revolution
Rise in prestige
1980s - PresentCorporations
Competing InterestsLoss of Political Influence
Germany1883
Social Security1935 Clinton
1994
Rapid Health Care Growth1950s-70s
Medicare1965
Nixon1970s
Truman Plan1945
MedicareDrug Bill
2003
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Health Care Reform Issues
Uninsured and Underinsured
Quality Initiatives
Patient Centered Medical Home
Health IT
Physician Pay Reform
Medical Liability
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Health Care Costs
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How Do You Share The Resources?
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How Do You Slice The Pie?
Whos going to take the smaller piece? Physicians?
Hospitals?
Drug Companies?
Trial Lawyers?
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Emergency Medicines Slice of Pie
119.2 million ED visits 2006
$ 37.5 billionon emergency care
Only 1.8% of all health care expenditures
Emergency Medicine is a small fish
Fixing the over-utilization of emergency
departments will NOTfix the problem
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1 in 10 Jobs in US is Health Care Related
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Are we in Crisis?
US health care costs have been in crisis for
roughly 40 yearsBrown, NEJM 24 Jan 08
Imminent Collapse rests on 3 indicators1. There are 47M uninsuredwe must have
universal coverage
2. Health care costs are extraordinarily high3. US system is in fact not a system, but
incoherent hodge-podge
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Are we in Crisis?
1. The Safety Netfor the Uninsured
Community Health Centers
Emergency Departments
Public and voluntary hospitals
Funds come from donations, Medicaid,
grants, etc. 11thhour infusion of money
President Bush told everyone that they can
always go to the emergency room
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Are we in Crisis?
2. Health Care Costs are High
Costs have been skyrocketing since 1965
when Medicare/Medicaid were signed into
law
US system has pushed technology
Research hospitals, drugs, medicines
Public health fell to the side
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Are we in Crisis?
3. The non-system of US health care willultimately drive reform
Clearly deep interest on all parties to bring
together the fragmented system, BUT:
Business, insurance, and providers have
different priorities, but all agree:
Big Government is NOT the answer
Costs of reform should not fall on them
Their agenda takes precedence
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Law of Reform
There is nothing more difficult tomanage, more dubious of success
than to initiate a new order of things.
The reformer has enemies in all thosewho profit from the old order and only
lukewarm defenders in all those who
would profit from the new order.
Machiavelli 1513
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What Glasses Are You Looking Through?
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Every System is Perfectly Designed To
Produce The Results It Produces
Don Berwick, MD
The Institute for Healthcare Improvement
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Here we go again.
1917, 1935, 1948, 2009