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That statistic about the percentage of spending being in the last 2 years of life may be a bit misleading, just like keys are always in the last place you look. Once someone dies, most healthcare spending on them stops. Auto accident that's fatal after surgeries and a few days? In that window. The same applies to plenty of things that may have excellent recovery chances but which are not 100%.

Edit: ObXKCD: https://www.xkcd.com/931/ (Lanes) Every one of those lanes going off to the right is the end of healthcare spending for someone, but you can't know going in which ones are going to turn off. Focusing on the "50% in the last 2 years" number is a lot like the the naive visualization at the top.

your point is well taken, but I feel like there is still a subset of "excessive spending at end of life" that we can discuss as being more obviously problematic, from a social spending point of view.

excluding trauma care for accident victims (that end up dying anyway), and excluding cases of early-in-life cancer, and excluding every other case we can think of where a spike of medical spending shortly before the person dies anyway is understandable as part of a good faith effort that had a reasonable chance of prolonging their life for many years, after all those exclusions are made we will still find many instances of cases where the end-of-life medical spending seems excessive.

The canonical example I can think of would be organ transplants for very elderly people. A new kidney for a 75 year old person in advanced renal failure is unlikely to prolong their life by very much.

This kind of stuff gets very emotional and very political though. This is what provoked the demagoguery about "death panels" when Obamacare was being debated in congress in 2009. We are both very uncomfortable allowing the government to make those decisions and also very uncomfortable allowing private insurers to make those decisions. We want to empower families to make those decisions and so remove cost from their consideration (via regulation, requiring insurers to pay) and then we become surprised when people who haven't made their peace with death are willing to spend any amount of money (which is a hidden cost from their point of view) to prolong end-of-life. It shouldn't be surprising. We set up a perverse incentive structure and locked it in place with regulations.

Keeping people alive too long is definitely a really difficult problem. Having walked through many dementia floors in nursing homes, I'd prefer to have some reasonable way of opting for assisted suicide in my will. Maybe once a consortium of doctors verifies I'm at a specified stage of dementia. Assisted suicide is another tricky area but I think it is humane when administered properly.

Alternatively, we could consider a more strict "No heroic efforts" for people with dementia -- which means not spending tens to hundreds of thousands on resuscitation or surgical procedures for people with dementia if they are not in pain from their current ailment. Its obviously nuanced, but there is a hugely significant amount of savings to be made if we can get over the political obstacles.

Physical rehab has some of the highest Medicaid/care reimbursement rates and you should see how many dementia patients are getting pointless "rehab" to the maximum a facility can bill.

It's getting more common to get a DNR/DNI (Do Not Resuscitate / Do Not Intubate ) put into a "living will" that goes to into effect if you are in a situation where you will no longer be mentally cognitive.

To your first points, the system exists as it does because each party can sort of displace the onus of overspending on another party.

1. Insurers are incentivized to seek out the minimum cost to achieve maintainable health.

2. Health care providers are incentived to reap as much as possible from insurers in return for acceptable (not always exemplary) health outcomes.

3. Patients, who on average are getting older and in need of more care, are pigeonholed (sometimes good, sometimes bad) into health care decisions by their providers and insurers.

4. Device/equipment manufacturers can charge ludicrous amounts because they capture very specific pieces of markets or gain preference from health care providers. However, the risk and cost involved in creating a new/competing product and entering a market can be staggering, and so high costs become inevitable (same argument drug developers can make).

As you said, 'justified at any cost' makes this whole shebang go, especially when no single party is capable of controlling the cost. We can't point to a boogeyman we all have a part in making.

As per 1- insurance companies justify their earnings as a percent of costs for care- so if they keep costs for care high, it actually helps them charge higher premiums. Of course, they have to ensure that costs are high for everyone.

If an insurance company were to announce record profits because they were able to better control costs than their competitors, there would be immediate pressure to lower premiums and not take the additional profits.

When it comes to health care, the idea that we have anything resembling a free-market and private competition to lower prices is a farce on a grand scale.

The law actually caps their profit margin[1] so it effectively forces the insurance to pay and charge more if it wants to increase its income. Ironically, this law is called "Affordable Care Act".

1. http://abcnews.go.com/Politics/obamacare-health-insurance-re...

I thought that was the case, but wasn't sure, so I did not include it in my original comment, so thanks for pointing it out and providing the link!

This would be more true if hospitals weren't allowed to bill patients for services that insurance refuses to cover.

But hospitals force patients to agree to be responsible for all bills their insurance doesn't cover.

So there are two large institutions, neither of which is entirely aligned with the interests of the individual dealing with them. Of course hospitals aren't trying to kill people, but good luck figuring out if the care they bill for is really necessary or not.

All correct...again, no price transparency, and every single party in the chain (other than the consumer) benefits from higher prices.

This has been a huge issue for me lately. Several times in the last year my family has been in the position of trying to decide whether to have a procedure done, and literally nobody can tell us how much it costs. Not the providers, not the insurance companies, not the hospital. "Probably less than $50k" is not a helpful answer. The best answers we were able to find came from other people who had already had similar procedures done at the same hospital, by the same providers. But even so, one quirk in the procedure, one extra diagnostic, one extra drug, can cost thousands of dollars. Once you've signed up for the procedure, it's very hard to say no to the extras. You might not even know they've been ordered until it's too late.

That phenomenon isn't unique to medical procedures. The answer to the question "how much is this lawsuit/software project/renovation going to cost?" is almost never going to be a definite number. (It's no surprise that people complain about bills in all these areas. But it's not your contractor's fault that your subfloor rotted and his $X quote for re-tiling now needs to include $Y for replacing the subfloor.)

But the contractor will at least give you an estimate and say, "this job will cost $2200 unless your subfloor is rotted out." And they can at least give you a verbal estimate of how much more it would cost if the subfloor is rotten. In the last year, I've dealt with this exact situation --- linoleum replacement with rotted subfloor. I'll take contractors over the medical industry any day for pricing transparency.

Freakonmics has an interesting episode where they cover the idea of offering a patient a bonus/rebate if they forego the standard end-of-life medical care. Quite a controversial suggestion but it does seem to have some though behind it

http://freakonomics.com/podcast/are-you-ready-for-a-glorious...

Well, the argument here is that for example, there are types of cancer which have extremely low survivalability rate, like 1 out 10 people who get it survive it. But we still treat them, and sure, right now 90% of them die but the data is used to create new drugs which in the future might improve the odds. If we just straight up said "it's very unlikely this person will survive so we won't spend $$$ on trying treatment" then we wouldn't get anywhere with many different medicines.

Those are pharma dollars. Different pot of money.

While discussion of death is a bit morbid, some towns in the US have experimented with death planning, led by care providers and counselors at local hospitals. It has led to significant savings without resorting to "death panels".

http://www.npr.org/sections/money/2014/03/05/286126451/livin...

Saving peoples lives isn't a unique practice in the US. Doctors in the developed world are all bound by the Hippocratic Oath, and I'm not aware of any first world country that regularly judges the sick or old to die when doctors still have options available. They still pay a third as much in healthcare.

A lot of those countries have physician assisted suicide though, which greatly improves the humanity of late term care. That is an easy and obvious piece of the solution the US should have been able to get behind a long time ago.

End of life care i not physician assisted suicide, and it's unhelpful to conflate the two.

Six US states have end of life care that can include doctors prescribing fatal doses of medication.

https://en.wikipedia.org/wiki/Assisted_suicide

> The United States has authorized medical aid in dying in six states, which refers to a terminally ill person with 6 months or less to live taking a medication prescribed by a doctor

Here in the UK, when the NHS decides whether a treatment is covered they take the cost and divide it by the estimated quality-adjusted life years it will give the patients who have it. If it costs more than £20,000-£30,000 per QALY they won't offer it. That's simply the value of a year of human life according to the NHS.

Keep in mind US healthcare costs are almost %20 of GDP

Cutting the fat from that may mean a lot of folks lose livelihoods (and THEIR healthcare).

Besides being illogical (i.e. it's bad to eliminate waste), this exemplifies the problem with change. Any time there is a ANY constituency that is rendered worse off, no matter how justified it is, it is nearly impossible to effectuate change because the affected group screams bloody murder.

But, wouldn't you? More importantly, shouldn't you? If the people in your government are doing something that is not in your best interest then you SHOULD speak up against it. After all, the word "representative" is based on the word "represent". If they are not representing my interests to the government then I should make that known.

If I have ailment X and a bill is being pushed that pulls funding/ assistance away from ailment X, then I should make it known that I am unhappy about it. What if it is now guaranteed that I will die from ailment X? You're saying that I shouldn't kick and yell about it? I'm about to die!

However, if it is also helps people with ailment Y, Z, I, J, K, and L, then it is the government's job to recognize that maybe I am less important to the bigger picture. If enough people will be negatively impacted to the point that I will not be reelected, then maybe it doesn't truly benefit my constituency as much as I think it will.

Of course all of this is in an ideal world without accounting for the power of advertisement funding and the fact that most of the voting population isn't well educated about the issues.

Broken window fallacy.

https://en.wikipedia.org/wiki/Parable_of_the_broken_window

Edit: Which is not to say those impacted won't need assistance moving on to other things. But, cutting the fat should be a net benefit to society.

A great deal of jobs in US defense are completely bureaucracy and make-work programs in disguise while the political discourse makes it sound like our soldiers are so underfunded they're marching into battle with muskets and bayonets.

A ton of people in government related jobs only have equivalent roles in jobs at equally large and capital inefficient bureaucracies.

> A great deal of jobs in US defense are completely bureaucracy and make-work programs

Obamacare was actually a make-work program for taxi drivers, who were needed to take all those poor people to and from their medical appointments.

Unless there was a single-payer system that didn't tie healthcare to employment and provided basic cover for everyone.

That doesn't solve the problem of the growing politicization of healthcare, especially given new life extending tech and augmentation, and it may make it worse in some ways: Year 2090 and an elderly bureaucrat can afford to be more productive than a sick impoverished child, who gets the funding?

Basic cover is provided for everyone.

Individuals can then purchase separate private insurance for optional health procedures and for faster elective care.

Australia's healthcare system works on a similar model. Everyone gets basic free cover, but waiting lists for elective surgery can range from weeks to months.

If you optionally pay for private health insurance then you can get better, faster treatment, including for elective surgeries.

In your hypothetical 2090, the sick impoverished child gets their basic needs taken care of by the basic cover, and the elderly bureaucrat gets his life extending tech and augmentation paid for by the private insurance he's been paying in to his entire working life.

Once the sick, impoverished child recovers, they can return to school, graduate, get a good job and pay in to private insurance so that by the time they are elderly they can also afford life extending tech and augmentation.

Don't ignore the elephant in the room. There is a good reason the USA spends the most on medical and has less than stellar results. That is without glancing at the corporate tax evasion.

Unfettered profit at all costs capitalism isn't a glowing unicorn.