Journal of Health Informatics & Management

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Editorial, J Health Inform Manag Vol: 1 Issue: 1

U.S. Healthcare System in Crisis

Naresh Khatri*

Department of Health Management & Informatics, University of Missouri- Columbia, USA

*Corresponding Author : Naresh Khatri, PhD
Associate Professor, CE729 Clinical Support and Education Building Five Hospital Drive, University of Missouri- Columbia, USA
Tel: (573) 884-2510
E-mail: [email protected]

Received: May 08, 2017 Accepted: May 10, 2017 Published: May 15, 2017

Citation: Khatri N (2017) U.S. Healthcare System in Crisis. J Health Inform Manag 1:1.

Abstract

The U.S. health care system is in crisis. It is both inefficient and wasteful, and seems unsustainable [1,2]. The Institute of Medicine Report (2012) estimates that about $750 billion, or 30 cents of every medical dollar, is squandered in unnecessary health spending annually [1]. According to the report, the waste and inefficiencies consist of unnecessary services ($210 billion), inefficiently delivered service ($130 billion), excessive administrative costs ($190 billion), and overpriced services ($105 billion).

Keywords: Health care systems; Whopping

The U.S. health care system is in crisis. It is both inefficient and wasteful, and seems unsustainable [1,2]. The Institute of Medicine Report (2012) estimates that about $750 billion, or 30 cents of every medical dollar, is squandered in unnecessary health spending annually [1]. According to the report, the waste and inefficiencies consist of unnecessary services ($210 billion), inefficiently delivered service ($130 billion), excessive administrative costs ($190 billion), and overpriced services ($105 billion).

Per capita spending on health care in U.S. towers over all other developed nations, and yet health care outcomes as reflected in key health indicators are at best average [2]. In other words, the U.S. health care system consumes far more resources to produce the same or lesser outcomes as compared to health care systems elsewhere. For example, the U.S. spent $8,508 per capita in 2011, compared to $4,522 in Canada, $3,405 in Britain, $3,213 in Japan, and the OECD average of $3,322 [2]. In total health care spending, U.S. spends 17.7 percent of its Gross Domestic Product, which is almost the double of the average spending of 9.3 percent of Gross Domestic Product for the OECD countries. Indeed, soaring costs of health care in U.S. are a source of severe financial burden and distress to Americans as evident from the fact that 62.1 per cent of all personal bankruptcies in 2007 were medical [3].

The consequences of mismanagement in the U.S. health care system are not just limited to financial costs. According to one estimate, almost 75,000 needless deaths could have been averted in 2005 alone if every state in U.S. had delivered care on par with the best performing state [1]. In 1999, the Institute of Medicine had reported that medical errors cause up to 98,000 deaths and more than 1 million injuries each year in U.S. [4]. A flurry of actions ensued as a result of the alarm sounded in the report including increased funding on patient safety research. Unfortunately, it remains unclear whether efforts to reduce medical errors at national, regional, and local levels have translated into any perceptible improvements in the overall safety of patients since then [5]. Obviously, the dysfunctional U.S. health care system needs to be fixed urgently. If left unchanged, it will continue to underperform, cause unnecessary harm, make U.S. firms and economy less competitive, and strain national, state, and family budgets.

While U.S. care system defies any simplification because it is so very complex, I identify two elements at the core of its dysfunction: greed and mismanagement. Unless we address these two core elements, it would continue to dysfunction colossally. I briefly explain the two elements below:

Rigged and Greedy

Ideally, when a system is designed by combining elements from two or more systems, it should borrow best elements from each. Unfortunately, the U.S. healthcare system rather than combining the best of capitalism and socialism has ended up combining worst of them. The strength of capitalism is efficiency, with its downside being greedy and exploitative. On the other hand, the strength of socialism is social equality and justice, its drawbacks being inefficient and wasteful. Put simply:

U.S. Health Care System = Greed of Capitalism + Inefficiency/ Waste of Socialism

Various powerful interest groups (American Medical Association, Big Pharma, insurance companies, hospitals, medical equipment companies, IT companies, to name some) have rigged it utterly. There are over 2,400 lobbyists representing health care industry meaning there are six lobbyists for each member of the Congress. So many lobbyists working full-time have turned U.S health system into one big scam. According to urban dictionary, a scam is a contrived scheme or process designed to surreptitiously, deceitfully, and materially benefit the perpetrator(s) at the expense of the victim(s). Such behavior captures well the behavior that routinely goes on in U.S. health care industry.

Mismanaged and Wasteful

Insiders of U.S health care system keep advancing the oxymoron excuse that health care system is too complex or that health care deals with life and death and thus everything it does is justifiable. This excuse should not get a pass anymore. The way health care is organized and delivered today needs to be overhauled [1,6-8]. For example, Gawande [6] noted: “Research on our health care system can save more lives…than bench science, research on the genome, stem-cell research, and everything else we hear about on the news.” Unfortunately, organizational and management issues in health care have generally taken a back seat because of a ‘clinician-centered care model’ [9]. The clinician-centeredness leads to three basic problems: (1) the system caters more to the interests of clinicians than patients, (2) cost and efficiency issues do not receive sufficient attention, and (3) health care delivery process remains fragmented and mired in silos created by various specialties and professions.

Data from workshop presentations and discussions summarized in The Healthcare Imperative (2010) show that, from 1999-2009, while average U.S. salary grew by 38%, the healthcare premiums grew by a whopping 131% [10]. Other data from the same report also suggest that if prices of other commodities had grown as quickly as healthcare costs since 1945, a dozen eggs would cost $55, a gallon of milk $48, and a dozen oranges would cost $134. A back-of-envelope calculation comparing the efficiency of the U.S healthcare industry with efficiencies of other industries might capture the colossal inefficiency and waste in the health care system [11-12]. For example, if the automobile industry would be as efficient as U.S. health care industry, a mid-size family car might easily cost over $200,000 and this car might break down every few months and every repair would then cost tens of thousands of dollars or even a hundred thousand dollars. Similarly, if an airline industry would be as efficient as U.S. health care, an airline ticket from New York to Los Angeles might cost something like twenty or thirty thousand dollars and the ticket might have to be purchased a year in advance and when you show up on the airport with your ticket, you might not find your seat or flight.

In conclusion, the U.S. health care system is in a deep crisis. It is causing ridiculous amount of turmoil in the American society. I have identified two problems that lie at its core: greed and mismanagement. Unless these two problems are addressed, U.S. health care system is only likely to get worse rather than better.

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