NPC in Health Affairs Blog: It’s Time for a Serious Conversation About Health Care Spending

Federal government figures released this week showed that the United States spent $3.3 trillion on health care in 2016, 4.3 percent more than in 2015. These new figures will undoubtedly kick off a flurry of responses and finger-pointing as to which health care sector is at fault or which radical fixes will solve the problem in the short term.

We recognize that “the United States cannot kick the health spending can down the road forever and assume that society will find a way to pay for the new technologies that our aging society demands,” wrote National Pharmaceutical Council (NPC) Chief Science Officer Robert W. Dubois, MD, PhD, in a post published today in the Health Affairs Blog.

Dr. Dubois noted that a serious conversation among all health care stakeholders is needed to address the important issue of health care spending. That’s why NPC is kicking off a broader stakeholder dialogue, funding research and supporting a series of papers and blog posts in Health Affairs.

Among the questions all health care stakeholders will need to address as part of this dialogue about spending:

1. How much to spend and upon what?
2. Should health care resources be shared equally or geared toward the few who are most ill? 
3. Are prices of surgery, devices, hospital stays, and drugs appropriate or too high?
4. Can we afford new cures for previously poorly treated illnesses? 
5. Can we afford not to invest in these future treatments? 
6. Has health care spending begun to crowd out other uses of societal resources such as education, local police and firefighters, infrastructure repair and will it worsen if solutions are not identified? 

As a starting point toward addressing these questions, NPC has embarked upon an initial series of research projects. These include:

1. International comparison of health care spending: Although the United States invests more in health care than other developed countries, this doesn’t always translate into better outcomes for all conditions. What accounts for this? The headlines here are often simplistic, and teasing out exactly how we pay for each element of health care can help us avoid misguided solutions that are nonetheless simple and attractive.
2. Lessons learned from health care allocation efforts outside the United States: The United Kingdom, Germany, Canada, Australia and elsewhere have employed methods to limit health care spending and allocate health care resources. An understanding of those efforts can provide lessons learned, what to avoid and whether the approaches can be applied in the pluralistic United States health care environment. 
3. Framework for discussing tradeoffs: Ethical and economic considerations underpin the issues of allocation and tradeoffs. Enumerating and understanding them can make a productive dialogue more likely. 
4. Assessing willingness to pay: Consumers, patients, employers and health plans likely differ in how much they might be willing to pay for improving health. Survey data can ground future discussions.
5. Understanding why efforts to reduce low value care been generally unsuccessful: If low-value-care dollars are to be harnessed, an understanding of what has hampered prior efforts may yield answers for greater future success.

“Failure to address these tough questions today will slowly whittle away the opportunities to decide about how we invest our health dollars until our only options are ones that no one would have chosen,” Dr. Dubois wrote.

Further details about the stakeholder dialogue and how to become involved in the conversation will be posted in coming weeks. Sign up for NPC’s blog alerts to receive updates about this initiative and other NPC research and activities.