solutions have pointed out the risks of change, and reform has repeatedly stalled. Inaction may not be possible for much longer, as increases in health care costs, which were $2.1 trillion in 2006 (Catlin et al., 2008), are rising faster than the gross domestic product, prompting one group of prominent analysts to predict that “By the early 2030s, assuming health care costs grow at their historical rate, the three major entitlement programs [Medicare, Medicaid, and Social Security] will absorb all of the federal government’s projected revenues” [emphasis added] (Frenzel et al., undated).

Health care costs also are prime contributors to escalating national debt and pervade economists’ concerns about the state of the entire economy. A September 2008 Congressional Budget Office (CBO) report concluded that current trends in federal spending and revenues are “unsustainable.” The CBO identified health care spending and, “to a lesser extent,” the aging population (which requires Social Security spending, as well as increased health care spending) as two of the largest ongoing contributors to growing demand for federal resources (CBO, 2008).

Dismay about high health care costs (see Box 2-3) is deepened by evidence that the money being spent on health care does not produce commensurate gains in population health. Much research comparing expenditures and care patterns in different areas of the country has shown that “spending more” does not improve health outcomes (Wennberg et al., 2008). Additional dismay stems from revelations regarding severe quality problems in individuals’ health care—problems that every year cost tens of thousands of lives, much needless suffering, and untold dollars (IOM, 2001).

BOX 2-3

The Results of Increasing Health Care Costs

  • Nearly 46 million Americans were uninsured in 2007—15.3 percent of the population (U.S. Census Bureau, 2008).

  • Eighty percent of the uninsured live in families with at least one employed individual, and a third have family incomes above 200 percent of poverty (Kaiser Commission on Medicaid and the Uninsured, 2008).

  • Some 18 million mostly poor and uninsured Americans now rely on publicly funded community health centers for their care (NACHC, 2008a).

  • These centers’ patient populations grew 56 percent between 2000 and 2006 (NACHC, 2008b).

  • A third of U.S. adults spend at least 10 percent of their income on health services or health insurance.

  • Medical debt is a factor in nearly half of personal bankruptcy filings (IOM, 2002).



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