While both presidential candidates have served up proposals to ease voter angst about the affordability of health care, neither candidate tackles the core issue of controlling health care cost growth, according to an article by economist Paul B. Ginsburg, Ph.D., in the Oct. 14 New England Journal of Medicine.
Per capita health spending increased 39 percent between 1999 and 2003 for privately insured people, while workers' average hourly earnings grew only 14 percent, according to Ginsburg, president of the Center for Studying Health System Change (HSC), a nonpartisan policy research organization funded primarily by The Robert Wood Johnson Foundation.
The main driver of health care spending increases over time has been new medical technology. Although many advances are extremely valuable, others have only slight benefits for patients and some are ultimately found to be harmful—the result of rapid diffusion without rigorous research on medical effectiveness of comparable treatments, Ginsburg notes. When health costs increase at a much faster rate than incomes, many people can no longer afford health insurance. Both presidential candidates have proposed ways to expand health coverage and keep coverage affordable, but both largely rely on increased government subsidies rather than proposals to slow underlying health care cost growth.
"For example, Kerry proposes reimbursing employers-sponsored health plans for 75 percent of catastrophic costs of more than $30,000 per person as long as employers pass on the savings to employees by reducing their share of premiums. This proposal for reinsurance would increase affordability not by slowing cost trends, but by substituting government payments for employee payments. Bush also emphasizes affordability rather than cost containment in his proposal for a tax credit for the purchase of individual insurance," the articles states.
Along with examining the candidates' health proposals, Ginsburg outlines four basic options to slow health care spending trends: