The economics of health care

Abstract

A study in Health Affairs demonstrates that the United States spent more on health care in 2000 than any other country in the Organisation for Economic Co-operation and Development (OECD) [1]. In 2010, total national health expenditures reached $2.6 trillion [2], which was over 17 % of GDP [3]; this percentage is the highest to date in America because the rise in health-care costs has outpaced inflation since 1970. In fact, in 1970, shortly after Medicare/Medicaid was created, health-care expenditures had comprised a mere 7.2 % of GDP. In 2008, our per-capita health expenditure was $7,538, which was $2,500 more than the next highest per-capita expenditure of Norway [4].