Billions lost in health care in the U.S.

220px Eddie Bernice Johnson Official Portrait c112th Congress 1
Eddie Bernice Johnson Official Portrait 112th Congress

By EDDIE BERNICE JOHNSON

U.S. House of Representatives

 

Supporters of the Affordable Care Act argued that one of the ways to make our nation’s health care systems more affordable was to cut the tremendous amounts of waste and fraud that we experience in health care delivery and implementation.

Now a new study further validates one of the basic premises of the legislation that was passed during the Obama administration, which made health care insurance affordable for individuals and families that had previously gone uninsured.

The study, published in the Journal of the American Medical Association, describes a health care system in which nearly 20 percent of the monies spent can be labeled as wasteful.

Changes in policy and practices could eliminate substantial waste, the lead author of the study, Dr. William Shrank concluded.

Health economists estimate that approximately $750 billion of health care are wasted annually in the United States.  That represents nearly $10,000 for each member of the population. At present health care spending represents 18 percent of the nation’s economy. That percentage is larger than the percentage spent on the nation’s military needs.

According to the study, the highest amount of costs is spent on administration, nearly $266 billion each year, the study states. The second highest cost is prices for health care. Ways must be found to lower the prices that are being paid for health care delivery, the study and experienced health care experts conclude.

The costs for ineffective and medically unnecessary health care procedures are another source of waste, according to the study. Unnecessary hospital admissions, unreasonable costs, a lack of preventive care and procedures, and practices that are of little or no benefit to patients are financially wasteful.

The ACA promotes payment of medical professionals to encourage and reward them for quality patient results instead of supporting a system in which medical professionals are paid simply because they attempt a particular procedure. Such a philosophy is identified as “valued based” under the health care law signed into law by President Barack Obama.

A more patient and cost sensitive health care system would no doubt lead to increased confidence in our health care system. There would be less patient stress and increased trust in the health care system if patients believed that their health and not the search for excessive profit were the primary objective of health care professionals, according health care experts.

 

Congresswoman Eddie Bernice Johnson represents the 30th Congressional District of Texas in the United States House of Representatives. She also chairs the House committee on Science, Space and Technology.

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