It’s important to keep the discussion of health care costs in perspective by comparing the cost of health care to other major spending categories. Take food, for example. Food is so important that ancient economists wrote about nothing else. It is traditionally the first category of necessities we list, right before clothing and shelter. No country has ever spent more on health care than on food.
Roughly around 2005, U.S. health care spending passed U.S. spending on food for human consumption. The United States has become the first country ever where the total cost of medical treatment is higher than that of food. And this is in a country that has the most luxurious approach to food of any country in history.
There is something screwy about this.
Think of how many restaurants we keep in business, and how much money they must take in. Then imagine this, if you can: the health insurance companies take in more than that.
We could excuse this if health care were more important work than food. But food is obviously more important. Health care might save your life someday, but not if you don’t have food. Without food, you’re dead for sure, and not someday in the unknown future, but within just a few months.
Think of the stories of people who go hungry so they can pay their medical bills. Now imagine that these are not just rare, isolated instances, but have become the norm. It sounds crazy, but that’s the direction recent trends are taking us. The way things are going, around 2021, the average employer will be paying more to the health insurance company than it pays to its workers. At the lower end of the income scale, we will see people working just for health coverage, receiving no take-home pay at all for their work.
Well, actually, we don’t have to wait for 2021 to see that. Workers have been choosing between health coverage and a paycheck for at least the last five years. Most, obviously, choose the paycheck, but the fact that it is an either-or situation shows that there is a problem.
Most people will agree that health care is worth spending a lot of money on. But more than we spend on food? It doesn’t make sense.