Sunday, November 20, 2016

Baker on Healthcare Cost Drivers In The US

I had previously posted about the drivers of healthcare costs in the US. The following from Dean Baker's book "Rigged" is illuminating:
A big part of the difference in costs is that our doctors are paid twice as much as doctors in other wealthy countries. Average pay for doctors in the United States is over $250,000 a year, and in some highly paid areas of specialization the average is over $500,000. Paying our doctors the same as Germany, Canada, and other wealthy countries pay theirs would reduce our health care bill by close to $100 billion a year. 
Doctors are able to maintain such high salaries in large part because of measures that protect them from competition. We have limits on the number of people who go to medical school and on the number of foreign medical school graduates who can enter U.S. residency programs, the completion of which is a requirement for practicing medicine in the United States.[84] State laws also limit the extent to which nurse practitioners and other health care professionals can perform tasks, such as prescribing medicine, that might limit the demand for doctors.
Baker also expands with the following example:
The average pre-tax earnings for orthopedic surgeons in the United States was $442,500, compared to an average of $215,500 in the reference countries.

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