2 d) Cost of Health care (con’t)

Perry calculates that measured in the amount of time working at the average hourly wage to earn enough income to purchase a washer-dryer combination, the “time cost” of those two appliances together has fallen by 83%, from 181.8 hours in 1959 to only 31 hours today.

What if we applied this kind of analysis to health care? The results are quite interesting. In 1958, per capita health expenditures were $134. This may seem astonishingly small, but it actually includes everything, inclusive of care paid for by government or private health insurers. A worker earning the average wage in 1958 ($1.98) would have had to work 118 hours—nearly 15 days–to cover this expense. By 2012, per capita health spending had climbed to $8,953. At the average wage, a typical worker would have to work 467 hours—about 58 days.

In short, while time prices for other goods and services had shrunk to less than one quarter of their 1958 levels, time prices for health care had more than quadrupled!

See chart at http://blogs-images.forbes.com/chrisconover/files/2012/12/healthprices.jpg 

Of course, health care in 2012 is vastly different and greatly improved compared to what was available in 1958. But the same can be said of other goods and services (Perry, for example, is comparing the cost of an iPod to 4-speed automatic record player).

The recent move to affordable health care is not the solution. Why is it that we are not willing to consider other health care models? I believe it has to do with the myth that everything American is always the best. The fact, however, is that we have been left behind in terms of affordable quality health.

Stay tuned, more to follow on this topic