University:
Boston University
Course:
CAS EC 203 | Empirical Economics 1
Academic year:

2020
Views:

9

Pages:

16
Author:

Greta Houston

THE JAWS OPEN New England Economic Project Themes • Health costs now rising faster than health revenue and Mass. costs are world’s highest • Export-oriented sectors of health care appear to impose high local costs--or are bound up with high local costs • Shaping affordable health care for all while protecting exports: – Possible? – If so, how? Health costs now rising faster than health revenues, and Massachusetts costs are the world’s highest HOSPITAL EXPENSES AND REVENUES, U.S.A. AND MASS., 1990 - 1999 380,000,000 11,000,000 10,500,000 360,000,000 10,000,000 9,500,000 320,000,000 9,000,000 8,500,000 300,000,000 8,000,000 280,000,000 7,500,000 260,000,000 7,000,000 6,500,000 240,000,000 6,000,000 220,000,000 5,500,000 200,000,000 5,000,000 1990 1991 1992 1993 1994 1995 YEAR 1996 1997 1998 1999 2000 MASS. EXPENSES AND REVENUES U.S.A. EXPENSES AND REVENUES 340,000,000 US Exp US Rev Mass Exp Mass Rev TOTAL HEALTH SPENDING PER PERSON, MASSACHUSETTS AND U.S.A., 1997 - 2002 $8,000 $7,000 $6,000 $5,000 USA $4,000 Mass. $3,000 $2,000 $1,000 $0 1997 1998 1999 2000 2001 2002 FAMILY HEALTH INSURANCE ANNUAL PREMIUM, STEADY BENEFIT PACKAGE, BIG EMPLOYER, EASTERN MASSACHUSETTS, 1990-2002 $9,000 $8,445 $8,000 $7,344 $7,000 $6,412 $6,000 $5,289 $5,289 $5,289 $5,330 $5,000 $4,000 $4,554 $5,556 $5,903 $4,782 $4,782 $4,053 $3,000 $2,000 $1,000 $0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 HEALTH, EDUCATION, AND DEFENSE SPENDING, U.S., 1960 - 2000, AS PERCENT OF GDP 16.0% SPENDING % OF GDP 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 1960 1965 1970 1975 1980 1985 1990 1995 2000 HEALTH 5.1% 5.6% 6.8% 8.1% 8.8% 10.2% 12.0% 13.4% 13.2% EDUCATION 5.0% 6.1% 7.3% 7.3% 6.5% 6.4% 7.1% 7.2% 7.1% DEFENSE 9.1% 7.0% 7.9% 5.3% 4.8% 6.0% 5.2% 3.7% 2.9% YEAR MASSACHUSETTS SPENT $6.9 BILLION MORE ON HEALTH CARE IN 1998 THAN THE NATIONAL AVERAGE: WHERE DID THE EXCESS GO? all other 11% Hospital 38% NH + home 28% MD + other prof. 23% Personal Health Spending's Share of Gross State Product, 1998 Maine Rhode Island Vermont Massachusetts USA New Hampshire Connecticut percentage rank 15.3% 14.8% 12.7% 12.5% 11.6% 11.3% 10.6% 3 4 18 21 32 37 HEALTH'S SHARE OF EACH STATE'S ECONOMY, 1998 20.0% 18.0% ME 16.0% RI 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% USA NH CT MA VT A few realities of Massachusetts health care, 2002 Mass. Estimated health spending, 2002 Mass. Mass. U.S. vs. U.S. rank $45 billion $1.55 trillion Est. health spending/person, 2002 $7,000 $5,400 + 30% 1 Hospital spending/person, 2000 $1,756 $1,267 38.6% 1 2.9 -11.2% 34 Hospital beds/1,000 people, 2000 2.6 Total hospital financial margin, 2000 -0.9% Physicians/1,000 people, Dec. 1999 Share of people in HMOs, 1997 Share of people lacking health ins. 2000 4.6% -- N/A 4.22 2.54 + 66.1% 1 55.9% 31.2% + 79.2% 2 9.5% 14.0% - 32.1% 7 UNINSURED RESIDENTS OF MASSACHUSETTS 1987 - 2000 900,000 800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 20 00 19 99 19 98 19 97 19 96 19 95 19 94 19 93 19 92 19 91 19 90 19 89 19 88 19 87 0 Estimated Cost of Bringing Mass.Caregivers up to U.S. Incomes/profits, 1999 • Hospitals • Physicians • Nursing homes $ $ $ 570,000,000 1,425,000,000 200,000,000 TOTAL $ 2,195,000,000 ACUTE HOSPITAL TOTAL MARGINS, USA AND MASSACHUSETTS, 1949 - 2000 8.0% 6.7% 6.0% TOTAL MARGIN =( total revenue-expenses)/total revenue 6.0% 4.0% 2.0% 3.5% 2.6% 2.0% 2.3% 5.8% 5.6% 2.9% 4.7% 4.2% 3.8% 2.8% 4.6% USA 2.6% Mass. 1.4% 0.4% 0.1% 0.0% 2.2% 6.7% -0.2% -0.9% -0.6% -0.9% -2.0% -4.0% -6.0% -8.0% -8.5% -10.0% 1949 1959 1969 1975 1980 1985 1990 YEAR 1995 1996 1997 1998 1999 2000 Economy and health spending • Some assert that health spending lags the economy by about 4 years • If so, whenever the economy decelerates or drops, health crashes through the windshield • (We need air bags) • Especially when caregivers’ margins didn’t fatten up during the economy’s fat years