FIN 434 Lecture Notes - Lecture 2: Infant Mortality, Aspirin, Root Mean Square
24 Aug 2016
School
Department
Course
Professor
Wednesday, August 24, 2016
Fin 434
Healthcare Reform
-Why does US Healthcare system need to be reformed?
•cost high / cost growing too fast
•inefficient spending
•too many people lacking insurance
•poor health outcomes
-Many views on health care reform
•first need to agree on what problem to address
•each problem listed may require different solutions
•sometimes solving one problem may exacerbate another
-providing more insurance may increase health care costs
-need to be explicit in what problems we are trying to solve and how we will go
about in solving
-need to also distinguish truth from rumor
-Are there really poor health outcomes?
•living longer, shorter recovery times, better anesthetics, joint replacements
•however, we are ranked #51 for life expectancy (below Bosnia, Greece & Jordan)
•Ranked #30 for infant mortality (worse than Poland, Cuba & Hungary)
•Overall, nothing to boast about when comparing to other countries
•there is inequality across groups i.e. death rates higher for men, and African
Americans; life expectancy has decreased for less educated females
-Do too many people really lack health insurance?
•Many have no health insurance
•approximately 35 million Americans lack insurance
!1
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Wednesday, August 24, 2016
•Note: Obamacare is not universal coverage
-only reduced the number of the uninsured
-Who are they?
•most are young adults with jobs
•most are low income
•about 20% have HH incomes > $50,000
•minorities, unmarried, and less educated are more likely to be uninsured
-Why are they uninsured?
•some choose to forego insurance
•some Medicaid eligible but have not taken up
•some cannot afford it
•uninsured get implicit insurance through “uncompensated care”
-Are health care costs really too high?
•The US spends 17% of GDP on health care in 2014
•equal to about $9500 per person, which is equal to the fifth largest economy in the
world
•US spends more than any other country, however we are a very rich country; could
be perfectly rational
•US spends more than it used to
-in 1960 we spent 5.2% of GDP on health care
•equal to $1000 / person (inflation adjusted)
-however, would we be willing to return to 1960’s medical technology in return for
$8500
-Are health care costs really growing too fast?
•since 1960, real GDP growth averaged 3.1%
•health care costs grew by over 5% per year during the same period
!2
find more resources at oneclass.com
find more resources at oneclass.com
