Tuesday, February 24, 2009

Report: Health Bang for Buck Unclear

The bang for the buck that the public happens to get for spending in the health care section is collateral good that may or may not accompany the bang for the buck private companies obtain from the expenditures. The greater the expenditure the greater the profit other things being equal. In some areas margins may be lean because of competition but in such areas as prescription drugs manufacturers are protected from competition by patents over long periods of time.

February 24, 2009
Health bang-for-buck unclear, report charges
OTTAWA -- Health-care spending has more than doubled in the last decade, but no one has any idea whether we're getting good value for all that cash, says the Health Council of Canada.
"We can account for how money is spent, but not, in any precise way, for what it achieves," the council says in a blunt report that asks whether citizens are getting the full return from their costly health system.
"Canadians don't need to spend vastly more but we do need to spend smarter."
Between the public and private sector, Canadians drop about $172 billion a year on health care - more than $5,000 per person. That accounts for 10% of gross domestic product. In 1997, spending totalled $79 billion.
The federally funded council is issuing "a wake-up call to Canadians," said CEO John Abbott.
"As we do in all other services that we consume, whether it's our Internet service, our telephone service, our automobile services, we always make a determination about how much we're prepared to spend for the value we get from that purchase," he said.
"Can we adopt that same attitude when we consume and use our health-care system?"
One American study, cited by the council, concludes that 30% of health spending in the U.S. is wasted through unnecessary or inefficient practices.
In Canada, the council says that while procedures such as cataract surgery are highly effective, sometimes they "provide poor value" - for example when performed on people with only slight vision loss.

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