Similarly, improvements in the diagnosis and treatment of cancer, heart disease, and high blood pressure have also resulted in marked decreases in death rates. Almost 50 percent of cancer patients now survive at least 5 years after being diagnosed.22 The age-adjusted mortality rate for stroke victims, an ailment related to high blood pressure and common in middle and old age, declined from 88.8 per 100,000 persons in 195023 to about 34.3 per 100,000 in 1983, a decline of over 60 percent. 24 Improvements in quality of life Development of new drugs, medical devices, and surgical and diagnostic techniques have improved the quality of life and reduced the levels of disability for millions of Americans. Drugs developed to treat cardiovascular diseases, epilepsy, peptic ulcers, and lower back problems have, in many cases, enabled individuals suffering from these conditions to lead essentially normal lives. Similarly, the development of renal dialysis and surgical techniques for kidney transplants have prolonged and improved the quality of life for individuals suffering from end-stage kidney disease. Surgical transplant techniques have become one of the most important innovations in medical technology, providing real hope to present and future generations. Advances in orthopedic surgery and the development of laser surgery have also improved the patient's health status and reduced disability and suffering. Orthopedic surgery, such as artificial hip replacement, can substantially improve the quality of life for persons with disabling bone and joint ailments. Similarly, the development of laser surgery has reduced the pain and suffering from many procedures and enabled more surgery to be performed on an outpatient basis. For example, laser surgery to remove cataracts can frequently be performed on an outpatient basis with minimal discomfort. Furthermore, laser surgery can reduce the rate of severe loss of vision in patients with diabetic retinopathy (the leading cause of blindness in persons between the ages of 20 and 74 years25) by at least 50 percent.26 Better access to medical care An additional benefit accruing to Americans from the investment in health care has been improved access to the health care system. Government-supported programs, such as the community health center program and Medicare and Medicaid, have helped to improve access particularly for the poor and the elderly. For example, between 1964 and 1979, hospital discharges for poor persons increased from 14 per 100 persons to Between 1963 and 1982, the percentage of low-income persons visiting a physician rose over 20 percent to a point equal to that for middle-income Americans.28 20 per 100 persons. 27 * One of the best examples of how our national health care expenditures has benefited persons is demonstrated through an examination of the relationship between federal funding of measles immunizations and the incidence of measles. Before the introduction of the vaccine, each year measles struck about 315 out of every 100,000 Americans, primarily children. Public funding of vaccination programs, following the introduction of the vaccine in 1963, resulted in the virtual elimination of measles. However, the number of measles cases began to rise sharply after public funding for measles immunization was curtailed in 1969. When federal immunization funds for measles vaccine were reintroduced in 1971, the number of measles cases again dropped. Federal support for measles vaccinations was again reduced between 1974 and 1977, resulting in nearly a threefold increase in the number of cases. However, federal programs established in 1977 and 1978 were instrumental in reducing the incidence of measles to 1.3 cases per 100,000 persons in 1981.29 HOW EXPENSIVE IS THE NATIONAL The nation's spending for health care has increased dramatically over the years in the aggregate, as spending per capita and as a percent of the GNP. Table 1 shows the increase in health expenditures from 1960 to 1984. ner ity on of pe fr 20 CO in OV fo am he gr ir 19 t Table 1 National Health Expenditures and Percent of Source: M. S. Freeland and C. E. Schendler. "Health Spending 8 National health care expenditures consist of many components. Hospital and physician services accounted for the majority of health care spending in both 1960 and 1983.30 Spending on hospital care increased from $9.1 billion (about 34 percent of health care spending) in 196031 to $157.9 billion (about 41 percent) in 1984.32 Spending for physicians' services increased from $5.7 billion (about 21 percent)33 to $75.4 billion (about 20 percent) during the same period. 34 The fastest growing component of health care expenditures was nursing home care increasing from less than 2 percent ($0.2 billion) in 195035 to over 8 percent ($32 billion) in 1984.36 Overall, expenditures for hospital care, physician services, and nursing home care amounted to about $265 billion in 1984, or nearly 69 percent of health care expenditures.37 HHS' 1984 expenditure data indicated the slowest rate of growth in health expenditures--9.1 percent--in 20 years.38 This increase compares with 10.6 percent in 1983 and 15.3 percent in 1980.39 Although HHS found that the reduction in inflation in the overall economy accounted for a large part of the decrease, other health care specific factors were important in explaining the rate of decrease in health care spending. Specifically, HHS cited the drop in the use of hospital inpatient services from American Hospital Association (AHA) survey data, which showed that community hospital admissions fell by 3.7 percent and inpatient days by 8.6 percent. Whether this signals a turn-around in the health care spending picture or a temporary dip in the rate of growth is not clear. Nevertheless, such recent changes in utilization and other dynamic changes in the health care sector should be monitored closely in the next few years. 40 Source: R. Gibson, et al. "National Health Expenditures, 1983." Health Care Financing Review, Vol. 6, No. 2 (Winter 1984), p. 7, and U.S. Department of Health and Human Services. HHS News. Press release dated July 31, 1985, Table 2. Federal government paying an increasing portion of health care expenditures Following the enactment of the Medicare and Medicaid programs in 1965, the percentage of the nation's health care spending paid by the federal government increased sharply from 11.2 percent in 196041 to almost 29 percent in 1984.42 shows the sources of payment for health care spending in 1984. Table 3 Table 3 Sources of Funds for Personal Health Care Expenditures, 1984 Source: U.S. Department of Health and Human Services. HHS 43 As shown in Federally financed health expenditures rose from $5.5 billion, or almost 5 percent of total federal expenditures in 1965, to over $93 billion, or 12 percent in 1982. table 4, combined Medicare and federal Medicaid expenditures accounted for over almost 75 percent of 1983 federal health spending. aIncludes the Indian Health Service; Alcohol, Drug Abuse and Mental Health Administration; the Office of Economic Opportunity programs subsequently transferred to HHS; and public programs not classified in other categories listed. bincludes program spending for maternal and child health; vocational rehabilitation medical payments; temporary disability insurance medical payments; Public Health Service and other federal hospitals; Indian health services; alcoholism, drug abuse, and mental health; and school health. Source: R. Gibson, et al. "National Health Expenditures, 1982." Health Care Financing Review, Vol. 5, No. 1 (Fall 1983), p. 24 and R. Gibson, et al. "National Health Expenditures, 1983." Health Care Financing Review, Vol. 6, No. 2 (Winter 1984), pp. 11 and 20. |