We Must Reform Our Nation’s Healthcare System Because Of The Costs It Has On The U.S. Economy
November 19th, 2008
On one hand you have Senator Ted Kennedy’s return to the Senate and Senator Max Baucus’ bold call to action on health care reform. On the other you have an economy in turmoil and worries about our nation’s fiscal future. In the middle is a question that comes as no surprise: can we really afford health reform? At the New America Foundation we respond with a different question: can we afford to wait any longer?
As our recent data analysis shows, failing to fix our broken health system is greater than the cost of investing in reform. Consider that the U.S. economy lost as much as $207 billion in 2007 because of the poor health and shorter lifespan of the uninsured. This is over $4,500 per uninsured resident – more than the cost of providing that person with quality health coverage.
Furthermore, health care costs will continue to grow faster than wages if we do not act. This will make health care increasingly unaffordable for more and more American families every day. In fact, we project that in 2016 half of American households will need to spend more than 45 percent of their income to secure health insurance for themselves and their families.
Meanwhile, the employer health care burden is undermining the ability of U.S. firms to compete and leading more and more American jobs overseas. Rising health care costs represent the single largest threat to the financial stability of federal, state, and local governments. As CBO Director Peter Orszag echoed in a recent post on his blog, we cannot secure our nation’s long-term fiscal future without fixing our health care system.
Our nation will recover from its current economic situation. But when it does the U.S. will still be faced with a crumbling health system. In the meantime, the cost of inaction is high. It will only rise over time. We must reform our nation’s health care system not in spite of our current economic crisis, but rather precisely because of the impact health care costs have on the American economy.
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