Printer Friendly

Health summit: costs have nowhere to go but up: experts may--or may not--be able to agree on how to fix the nation's health care ills. Yet they all agree that providing health insurance will keep on getting more expensive.

Health care expenditures are going in one direction: up. The reasons for the rise in the cost of health care are, however, far more complex. Societal affluence, consumer expectations, the public's refusal to consider limits on medical procedures, the revulsion at rationing and the peculiarities of the health care industry all play a part. Then there's technology.

"In most industries, advances in technology decrease costs, but it's just the opposite in medical care," said Roberta Goodman, principal of the consulting firm Health Care Analyties LLC. She delivered her comments at the 2004 Ingenix Health Information Summit in May.

The health care industry's experiments with free market competition have added to the complexity of a system that still cannot protect an estimated 40 million people. In the 1970s, employers and unions typically offered one insurance program. One or a few large insurers, such as Blue Cross Blue Shield, had the majority of the market in most states. In the 1980s, competition increased with plans offering low out-of-pocket expenses through an HMO model with networks of physicians. The 1990s brought a consolidation of plan providers, but with greater variety to the products.

A new "experimentation" phase is about to begin, according to one consultant, whereby consumers may be far more exposed to the true cost of health care than they have been previously. "At the moment, I believe we are headed into an experimentation phase again," said Bill Schlag, a principal at the benefits consulting firm of Hilb, Rogel & Hobbs.

Consultants at the conference also noted that hospital volume for profitable procedures, not surprisingly, tends to go up over time compared to volume for less profitable procedures. As a result, providers' financial and legal interests are served by providing more care.

The consultants additionally pointed to the large jump in investment in technology companies in the biomedical fields and in the number of products in the pipeline. These forces add to the price of health care. Simply making new medical resources available will largely assure that they get used, said Goodman, an authority on the medical system. She cited research estimates that "50 percent of the rise in real medical costs is attributable to technology advances."

At a time when patients are acting more like informed buyers and doctors more like supply consultants, Goodman spoke of a recurring theme underscored by attendees: the need for a large, Web-based technology infrastructure with extensive databases that can inform every medical action based on evidence of sound, affordable practices.
COPYRIGHT 2004 Axon Group
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2004 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:Up front: news, updates and other emerging strategies from around the world
Author:Allen, Russ
Publication:Risk & Insurance
Date:Sep 1, 2004
Words:414
Previous Article:A law's uneven spoils: a certification process to protect companies from liability in the development of anti terrorism products and services appears...
Next Article:Smaller cities turn to software to fight terror: when raising taxes is not an option, the efficient allocation of manpower and resources is a town's...
Topics:


Related Articles
Taking control: new kinds of health plans fight medical inflation by blending economic incentives with consumer choice. (Health-Care Costs).
A 'Tsunami' heaves toward U.S. shores: Using sand-bags to defend corporations against a tidal wave of rising benefits expenses is unlikely to do much...
Rays of hope: health costs and health-insurance premiums are still on the rise, but 2006 increases are smaller than last year's.
Universal health care surging in popularity with policy-makers.
Fulfilling the CDHP promise.
Code blue: the patient is ailing, the prognosis is poor. It's the nation's major medical emergency.
Curing the health care crisis: is the promise of consumer-driven health care real?
Doctors aim for respect, then money: financial compensation is one thing, but increasingly doctors who provide expert care of injured workers want...

Terms of use | Privacy policy | Copyright © 2021 Farlex, Inc. | Feedback | For webmasters