What could be done to stop, slow,or even reverse the growth of health care expenditures?
If it were completely clear as to how this could be accomplished, it is likely that we would already have accomplished it. Therefore, it must be hard to understand for certain how to cut these costs. It appears that there are two possible approaches to reducing costs. One is to promote competition while the other is to centralize control over the health care system in the hands of the government.
Liberals typically believe that the way to control costs is to have the government control the health care system. They believe that we could control costs by cutting out the profits that hospitals and other providers take. They believe that we could control costs because the government, as the dominant (or only) buyer of things like drugs could demand better prices from the drug companies. In these ways and others, government control would reduce costs.
Conservatives typically believe that only increased competition can control costs. They believe that there should be, for example, more insurance companies competing for customers. They believe that this (along with reforms to make consumers actually aware of how much their health care costs), will cause insurance companies to provide insurance at the lowest possible price. This would give the insurance firms an incentive to pressure the health care industry for lower prices.
There are, of course, people whose ideas are a mix of these, but these are the two main types of approaches being proposed to reduce the cost of health care in the US today.
There are various suggestions that have been made that could help control health care costs. One solution would be for consumers to pay the full cost of their health care. By doing this, consumers will be more aware of the costs and will be less likely to use health care services unless absolutely necessary. This approach is similar to the one used by people who have catastrophic insurance. They have very high deductibles, so they pay for most health care services that they use. This makes people more cautious when deciding to obtain medical care. If all prices were made public, consumers of medical services could shop around for the best price.
Another approach is to have third-party individuals decide if a service is necessary and if it will be covered. Managed care policies use this method. People will be more cautious when choosing to use medical services, as they might have to pay the full cost of the services they use. This approach tries to instill discipline in consumers, so they use services that are only absolutely necessary.
The third approach is to have the government or some agency manage the entire health care system. The government or the agency would negotiate prices for various medical components including medications, health care services, fees paid to doctors, and hospital fees.
These are some ideas for controlling the cost of medical care.