What Is Driving U.S. Health Care Spending? America’s Unsustainable Health Care Cost Growth

By Loren Adler, G. William Hoagland

Thursday, September 20, 2012

This background paper provides a basic overview of the drivers of health care cost growth, and serves as an analytical starting point for BPC’s work on health care cost containment.

The Bipartisan Policy Center (BPC) is embarking on an effort to address unsustainable health care cost growth in the United States. With the leadership of former Senate Majority Leaders Tom Daschle (D-SD) and Bill Frist (R-TN), former Senator Pete Domenici (R-NM) and former Congressional Budget Office Director Dr. Alice Rivlin, the BPC Health Care Cost Containment Initiative will explore and evaluate strategies to contain health care cost growth on a system-wide basis, while enhancing health care quality and value. Our current health care system is rife with opportunities to reduce waste, deliver more effective, coordinated care, and improve the health and well-being of all Americans. BPC will prioritize effective cost-containment strategies with the greatest potential for bipartisan support and political success in 2013.

At a basic level, health spending is a product of the price of health care services and the utilization of those services. The underlying drivers of price and utilization, which in turn are the key drivers of overall health care spending growth in the U.S., are described in this paper.

Download the full paper

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Read the press release here.

Read the blog post here.

Learn about BPC’s Health Care Cost Containment Initiative.

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