The First Wealth is Health

We hear a lot about healthcare spending in the United States. We spend more on healthcare than any other nation in the world. The healthcare economy in the U.S. is larger than the total economy of all but 5 nations on the planet. Upwards of 17% of our Gross Domestic Product (GDP) is spent on healthcare.

Often these commentaries come with the dire warning that we simply can’t continue to spend 1 in 6 dollars on our health care economy. We will simply run out of money.

Hmmmmm……Run out of money?  What did people say when spending went above 10 percent.  Between 1980 and 1984, total health expenditures topped 10% of the gross domestic product in the US for the first time.  Policy makers and commentators raised the same issues. We can’t keep spending more money. Ten percent of GDP is way too much. The increase is not sustainable.  Yet, here we are nearly 35 years later, spending more money, buying more healthcare services. Through recessions and progressions, bull and bear markets, the healthcare economy keeps moving along.

My house value has nearly rebounded from the recent housing bubble burst, and the hospitals in town keep building more ERs and ORs decked out with all the newest and most expensive equipment along with complimentary valet parking. And the common refrain continues, “the growth in healthcare spending is not sustainable.”  Really? We can’t keep spending more? The evidence simply does not support this notion.

Ralph Waldo Emerson said, “The first wealth is health.” So why not spend everything necessary to get good health? Why not spend 20% of the GDP? Why not spend 50% of the GDP to get good health?

Maybe that’s the issue. We are spending lots of money, but not getting good  health.  This is the first generation whose life expectancy is lower than their parents. The rise in diabetes, chronic disease, cancer and vaccine preventable illness makes headlines.  Our mental health is suffering, generalized stress and anxiety are on the rise, and obesity and poor fitness are rampant.

My son is taking an introductory economics class. He came home chattering about the opportunity costs of this and that.  When you buy one item it means you don’t have that money to buy a different item. You can’t spend the money twice. Opportunity cost is the concept that we must choose between two items; we get something when we purchase and item, but we also lose something because we don’t choose the second item. In healthcare, this means that when we spend more and more money on healthcare, we can’t spent that money on other things.

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