Healthcare spending in the United States is out of control. The per-capita healthcare expenditures in the United States are currently running at over $9,500 per year. This is three times the OECD average and thousands more than what the second-place country, Switzerland, spends. What’s worse, healthcare expenditures have continued to expand parabolically, causing the single largest drain on the federal budget to now be healthcare related. If something is not done to rein in the out-of-control growth in healthcare costs, the United States will eventually begin to feel serious pain, with forced cutbacks in medical benefits for many Americans.
However, one of the leading figures in the U.S. healthcare industry, Drew Madden, has a number of concrete ideas as to what has been going wrong in the nation’s healthcare system. Madden has been in the Healthcare IT space for his entire career. He has worked for the Cerner Corporation as well as Epic Systems, the two dominant players in the Healthcare IT space. As an expert in both computer systems and the human organizations that comprise the nation’s healthcare system, Madden has been able to identify some of the key problems that are currently facing the country’s healthcare system.
One of the biggest problems that Madden discusses is that there is a general lack of competitiveness within the healthcare system. The magnitude of this problem, says Madden, is so great that most people have little grasp of what a tremendous threat it poses to the nation. As an example, Madden talks about a case where researchers uncovered serious price disparities within a small market. On one side of a medium-size town, a doctor’s office was charging $30,000 for a particular back procedure. On the other side of town, less than ten miles away, that same procedure was being priced at $70,000.
Drew Madden points out that such disparities are not only obvious evidence of serious market inefficiency, but they are also extremely common. Part of the solution that Madden offers is the creation of systems that allow for accurate and fast reviews of doctors and medical practices, much in the same way that restaurant reviews work.