By now, we’re all familiar with the coronavirus pandemic.
But what’s the real story behind the pandemic?
And why is the US government spending billions on a global healthcare system that’s not working?
We’ve already covered a lot in the past week about how the pandemics money is being wasted on healthcare and not spending it on the healthcare system it should be paying for.
In the past few weeks, we’ve also seen reports that the US is spending $1.5 trillion a year on healthcare in lieu of actually saving money.
So how much of this is true?
The US government is spending a lot more money on healthcare than the rest of the world.
But is this really true?
That’s a question the US has yet to answer.
A new report from the RAND Corporation suggests that the real money spent on healthcare is much lower than we think.
The report found that the healthcare expenditure in the US actually represents less than 0.1% of GDP, but the real cost of healthcare in the United States is actually over 10% of US GDP.
That’s a pretty big difference.
If we assume that the United Kingdom spent 5% of its GDP on healthcare, the US spends about 1.3%.
That’s actually a much smaller difference than you might think.
For example, in 2010, the United Nations Office on Drugs and Crime estimated that the world spent $19.6 trillion on healthcare.
By 2025, that estimate was closer to $18 trillion.
So the real difference between spending 5% and 10% on healthcare versus not spending any money at all would be about $3.5 billion a year.
In other words, the difference between 5% spent on the pharmaceutical industry and 10%, as some politicians argue, is pretty small.
This is the problem with trying to quantify the true costs of healthcare.
Because healthcare is expensive, we can’t just look at spending on the medical industry and figure out the real value of healthcare spending.
For that to happen, we’d need to get a lot better at measuring the true cost of the healthcare that is delivered in the U.S.
The RAND study did have a couple of other important points to note.
First, the report also found that healthcare spending in the country actually grew at an annual rate of 4.6% from 2010 to 2020.
Second, the growth in healthcare spending was mostly driven by the pharmaceutical sector.
That is, healthcare spending grew more slowly in the pharmaceutical and biotechnology industries.
The US spent a lot less on healthcare overall in 2010 than it did in 2016.
That’s not surprising, as the pharmaceutical market is actually quite healthy in the USA.
The US spent about 3% of the GDP on pharmaceuticals in 2010.
In 2020, that number rose to about 5%.
This means that healthcare is still relatively cheap.
It’s still expensive compared to other industrialized countries, and it’s still relatively inexpensive compared to what the rest.
But the US health system is actually working well compared to the rest, and that’s one of the reasons it’s so expensive.