The U.S. spends about 50% more per capita on healthcare than other countries with comparable levels of income and development. The biggest contributors to these high expenditures include higher prices for medical procedures, hospital days, and drugs as well as higher utilization of medical resources and higher administrative costs. However, the U.S. is uniquely positioned to make big strides in reducing healthcare costs despite its dismal past in healthcare cost management.
For example, the U.S. currently spends $133 billion per year or 4% of healthcare expenditure treating tobacco-related illness. If smoking were still at 40% levels of the 1960, current expenditures would likely be twice as great. Fortunately, a campaign against smoking in the U.S. has reduced smoking prevalence by more than half over the last 50 years.
Chronic diseases account for 80% of U.S. healthcare costs. Several major chronic diseases are brought about by obesity and drive up many healthcare costs. Expenditures for cardiovascular disease, diabetes, and high blood pressure add up to $732 billion, which is about 24% of U.S. healthcare expenditure. Thus campaigns to reduce obesity would go a long way toward bringing U.S. healthcare costs down, not to mention it would greatly improving longevity and quality of life.
Entrepreneurs and start-ups are leading campaigns to help people improve their eating habits. Both the retainer-based, intensive primary care start-ups such as Iora Health or OneMedical and the wellness platform start-ups like Welltok are prospering by helping customers address this need and opportunity. Recent U.S. healthcare reform initiatives and campaigns have prompted major healthcare cost reduction via value-based provider payment. The benefits of significantly reducing obesity and smoking rates would be hugely vital to Americans and corresponding healthcare costs.
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