Author: Jeff Goldsmith

When I first appeared in Healthcare blog Fourteen years ago, it condemned the policy community’s obsession with bad news about the health system: https://thehealthcareblog.com/blog/2007/10/03/the-perpetual-health-care-crisis-by-jeff-goldsmith/Therefore, while we are fighting the COVID pandemic, we continue to hear regularly about drug price fraud, anti-competitive hospital mergers, bad labor relations, and supplier burnout. Therefore, we can expect to hear nothing about the health system’s failure to participate in the current outbreak of inflation in the US economy.

The Altrum Institute, a Washington think tank, tracked these things and reported on November 16 https://altarum.org/sites/default/files/uploaded-publication-files/SHSS-Price-Brief_November_2021.pdf, We learned that, compared with the consumer price index of 6.2% and the producer price index of 8.6%, the annual growth rate of healthcare prices in October 2021 was only 2%. Altarum commented that this is “surprising because many factors that affect prices across the economy (labor shortages, supply chain issues, and increased demand for services across the economy) are also expected to affect healthcare.”

Moderation is not only related to price. Since January 2020, overall health spending has only increased by 4.4%, and the percentage of GDP devoted to health has fallen by more than 0.5%, from 18.1% before the pandemic to 17.5% in October. Despite the four surges in COVID hospitalizations, overcrowded ICUs and emergency rooms, labor shortages, and other COVID-related pressures. The staffing level of the health system is still nearly 500,000 lower than before the pandemic. If the federal government fails to intervene through the CARES Act, FEMA funding and temporary suspension of medical insurance rates, hospitals in various countries will be severely damaged by the financial pressures associated with COVID, and these pressures are far from over.

This restraint in health care prices and expenditures has paid a terrible price: direct nursing staff throughout the system is exhausted and morale is low, operating profit margins plummet, and the number of queues for selective care in various forms increases.However, as I and my colleague Ian Morrison (Ian Morrison) in Health affairs In a blog earlier this year, the US hospital system did strengthen, especially during the pandemic, and was one of the only parts of our national infrastructure that exceeded expectations during COVID, potentially saving hundreds of thousands of people. life: https://www.healthaffairs.org/do/10.1377/hblog20210308.673278/full/

Health insurance companies profited from this suspension because they established a higher cost increase rate in the 2020-2021 rate. When hospitals and doctor groups begin to require commercial insurance companies to provide some rate reductions for employers and public projects (such as managing Medicaid and medical insurance advantages) in the next round of contract negotiations, will they consider moderation? Not too possible! The press and policy circles are also unlikely to stop whipping their health system’s list of whipping boys.

The fact is that keeping the $4 trillion health system on the defensive is conducive to strong economic and political interests. However, think about it if this care system does not respond to the huge social challenge of COVID, our society will get worse. This kind of heroism and continuous cost control are not in line with the health policy narrative that has been abused in the past forty years. Maybe it’s time for a reality check and a more balanced narrative.