'Choose Wisely' to Shrink Healthcare Costs
The healthcare sector should be given a pat on the back for innovative work over the past few years that has "bent the cost curve" to a point where healthcare inflation is riding a few percentage points higher than overall inflation.
That may seem like faint praise. The 4% annual increase in healthcare spending in 2011, as reported by the Congressional Budget Office in February, grew faster than most paychecks. Still, it's about half of the rate seen in the early 2000s, according to a recent analysis by Moody's Investors Service.
Analysts have acknowledged that much, but not all, of that slower cost growth can be attributed to the effects of a dragging economy marked by higher unemployment, the loss of health insurance coverage, and the advent of high-deductible health insurance plans. Better management plays a role too, as providers scan the healthcare cost spectrum from patient throughput to floor wax for savings through new efficiencies and waste-cutting measures.
All of this in-house reordering by providers is only half the battle. As has been noted, if we want to reduce healthcare expenditures we have to change the behaviors, expectations, and decisions made by healthcare consumers, a.k.a. patients.