Personal Reflections on the High Cost of American Medical Care

Many Causes but Few Politically Sustainable Solutions

To reduce health spending, Americans must distinguish between high and low-risk patients; overcoming fears of “rationing” will be critical.

Steven A. Schroeder, MD, has devoted his career to restraining health care spending (currently 17% of the U.S. gross domestic product). In this special health care reform article, Schroeder recounts his experiences as medical director of the George Washington University (GWU) medical outpatient clinics and HMO, and president of the Robert Wood Johnson Foundation.

While at GWU, Schroeder investigated why some of the clinic’s physicians accounted for significantly more costs than others; with the Division of General Internal Medicine at the University of California, San Francisco (UCSF), Schroeder modeled the costs of new treatments and found that:

  • The use of tomographic head scanning at GWU was adding to patient costs.
  • A 1979 report from the California Blue Shield Medical Committee “killed” a bill that would have insured high-cost patients in San Francisco hospitals.
  • Three factors inflate health costs: 1) the use of new technologies, 2) hospital stays, and 3) reliance on medical specialists.

In this article, Schroeder discusses three decades reigning in health care spending at major medical and public health institutions.