Tuesday, March 1, 2011
Health care and fiscal reform
The US budget is clearly problematic. Social security is not a big problem (and people who argue otherwise clearly have not thought strongly about the numbers). Medicare however is a huge problem - and extraordinarily underfunded.
But a picture on the Wall Street cheat sheet shows how large the opportunities are...
The USA health care spend is at least 3000 dollars per capital too high relative to outcomes versus any other OECD country. It is probably closer to 4000 per capita. Times 307 million people there is 900 billion to 1.2 trillion dollars on the table in dealing with health expenditure.
I have written about how you might squeeze the roughly trillion dollars out before - but there may be other ways of doing it.
However that roughly trillion dollars of excess costs is a lot of peoples' income. They are not going to want to get squeezed and they will lobby (probably very effectively). It ain't gonna be easy no matter how you do it.
Still any government that gets this right can right America's fiscal situation with almost no other policy action at all. What others see as waste I see as an opportunity for America - and a reason why America is ultimately more solvent than the bears imagine.
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