Why Are Healthcare Costs So High? - Part 2

Healthcare Expenditures Are Concentrated

High-Cost Healthcare Users

Causes of Common Chronic Conditions

Addressing the High Costs of Healthcare

 

In my previous blog entry, Why Are Healthcare Costs So High? - Part 1, I presented data indicating that

  • US healthcare expenditures have been increasing over time (see Figure 1 below reproduced from my previous blog entry),
  • There seems to be a shift during the 1980s, in which annual personal expenditures on healthcare started increasing at a faster rate (see Figure 1 below reproduced from my previous blog entry),
  • Healthcare expenditures for treating the top 20 medical conditions account for 75% of expenditures captured in surveys of healthcare expenditures for hospital inpatients, patients treated in physicians’ offices, and prescription medication, and
  • The increases in spending for the top 20 diseases are due mostly to increases in the number of people being treated for (chronic) diseases, rather than to increases in per-patient costs of treatment (see Figure 2 below reproduced from my previous blog entry).

In this blog entry I examine the distribution of healthcare spending across different portions of the population.

 

Why Are Healthcare Costs So High? - Part 3

Factors Contributing to Rising Healthcare Expenditures Over Time

America’s Weight Problem: Increasing BMIs Over Time

Changes in Society Causing Increases in BMI over TIme

The Rise in Healthcare Expenditures is a Consequence of America’s Weight Problem

 

 

In my last two blog entries, I found that

Part 1

  • US healthcare expenditures have been increasing over time,
  • There seems to be a shift during the 1980s, in which annual personal expenditures on healthcare started increasing at a faster,
  • Healthcare expenditures for treating the top 20 medical conditions account for 75% of expenditures captured in surveys of healthcare expenditures for hospital inpatients, patients treated in physicians’ offices, and prescription medication, and
  • The increases in spending for the top 20 diseases are due mostly to increases in the number of people being treated for (chronic) diseases, rather than to increases in per-patient costs of treatment.

Part 2

  • Healthcare expenditures are concentrated, where the Top 5% of Users account for over half of total healthcare expenditures
  • the Bottom 95% of the population is paying roughly twice as much for healthcare services than they actually use, where the difference is going to subsidize the Top 5% of healthcare users, and the Bottom 70% of the population is paying seven times as much as they use, where the difference is going to subsidize the Top 30% of healthcare users.
  • The high-cost healthcare users are people with multiple, chronic conditions, including coronary artery disease, diabetes, congestive heart failure, and chronic obstructive pulmonary disease.
  • At least seven of the top ten medical conditions that account for the majority of healthcare spending can be at least partially prevented and/or mitigated by factors under the control of individuals, namely, weight control, eating habits, drinking (alcohol) habits, activity levels, and smoking status.

In this blog entry I examine how changes in society over time have led us to where we are now, with so many people suffering from chronic medical conditions.

Will Smartphone-Enabled on-the-Spot Price Comparisons “Upend” Stores’ Business Models?

Price Dispersion

Has the Internet Caused Price Dispersion to Decrease?

What Determines Retail Price?

How Big Is e-Commerce?

Conclusions

 

A recent article in the WSJ, “iPhone-Wielding Shoppers Strike Fear Into Retailers” by Miguel Bustillo and Ann Zimmerman, discusses the increasing incidence of in-store shoppers using their smartphones to compare in-store prices to prices available from other retailers on the Internet, and it claims that such consumer behavior “is threatening to upend the business models of the biggest store chains in America.”

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Strategic Maneuvering in Dynamic Markets
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