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Changing U.S. Health Care

Sunday, August 23, 2009 at 12:19 AM EDT

As far as I can tell the government’s proposed “health care reform” can be summarized as “put more money into the existing U.S. system”. I’m wondering why we as a society would want to do this.

Let’s look at how our current system is doing, starting with this table of life expectancy for different countries worldwide. Mexico seems like the best comparison. Mexicans share our continent, our love for soda and corn syrup, and our tendency towards chubbiness (source). We spend approximately $8500 per year per American on health care and live to the age of 78. A Mexican can expect to live to age 76. How much do Mexicans spend on health care? Their per-person GDP is only about $13,000 per year, and they supposedly spend about 6 percent of GDP on health care (source) so $800 per person is a good estimate.

Another way to look at these numbers is that an American will spend $600,000 in order to add two years to the end of his life. Those two years may very well be spent in an intensive care unit or a nursing home and certainly are not likely to be spent on the tennis court or visiting the Venice Biennale.

For $600,000, an American could have the following:

  • a house, free and clear of all mortgages (median price for a single family house sold nationwide in May 2009 was $170,000)
  • a lifetime supply of automobiles, assuming $20,000 per car, a 10-year life per car, and 50 years of driving ($100,000)
  • 50 vacations for a family of four (average cost $1600; total of $80,000)
  • a college education ($25,000 of tuition for four years at a public university, roughly the average cost)
  • two children, reared to the age of 17 ($125,000 per kid, average cost for a basic family (source); note that a pair of Americans could have four children, all of whose costs would be completely paid for out of this $600,000)
  • $75,000 in walking-around money

If we had unlimited money it certainly would be nice to have the kind of health care that we have. But the Collapse of 2008 highlighted the fact that we don’t have unlimited money and resources. Wouldn’t most Americans rather have their house, car, vacations, college, and children paid for than get extra MRIs, helicopter medevacs, and death-after-weeks-in-the-ICU that the insurance companies and government (Medicare/Medicaid) are buying on our behalf?