Health care costs

April 16, 2007

In the comments to this post, Maggie Mahar offers some interesting stats on health care costs. Roughly 75% of our $2 trillion dollar health care is spent on severe chronic illness. Malpractice lawsuits increase costs 0.5%, though it may result in over-treatment because doctors want to cover their ass in case they get sued. The rule of thumb in software development is 20% of your code consumes 80% of your execution time. Profile your software and fix the hotspots. In health care, the hotspot is clearly chronic illness. Perhaps the easiest solution is government health care only for chronic illnesses. Even if the government offered lavish care, it would still save tons of money by using effective treatments, not expensive drugs & devices of dubious efficacy (which Mahar blames for most of the cost increases). If you can cut those costs in half ($750 billion instead of $1.5 trillion), you’ve saved enough money to pay for every man, woman and child to join the Jenny Craig weight loss program. Problem solved!


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