alan1
Gold Member
Exceeding 100% of GDP is an impossibility, by definition, 100% is the maximum possible.Spending on pet healthcare have actually grown faster than on humans.
Why are all healthcare expenditures rising? Because new innovations cost more.
This chart from Andrew Biggs "shows spending on veterinary care, which I pulled from the Consumer Expenditure Survey, and national health expenditures (for people) from the National Income and Product Accounts.... the rate of growth of spending from 1984 to 2006 wasnt all that differentand in both cases, spending grew faster than the rate of economic growth. As new technologies are developed for humans, we adopt them for Bowser and Fifibecause we can afford to and we think its worth it."
These data are consistent with what I wrote a couple years ago: "The reason that we spend more [on healthcare] than our grandparents did is not waste, fraud and abuse, but advances in medical technology and growth in incomes. Science has consistently found new ways to extend and improve our lives. Wonderful as they are, they do not come cheap. Fortunately, our incomes are growing, and it makes sense to spend this growing prosperity on better health."
Greg Mankiw's Blog: Keeping Animial Spirits Alive
There is no argument that a good portion of the increases in healthcare spending are due to new innovations and technologies that have helped extend the lives of most people. The problem is that the rate of increase is unsustainable financially. Based on the rate of growth over the last twenty years, if we continue at that same rate, we will eventually spend more than 100% of GDP on healthcare.
There is a limit as to how much a society can spend on healthcare, and we are reaching the breaking point. As costs continue to rise, we will see more and more Americans without insurance or some type of healthcare coverage. So fewer and fewer people will actually use or be able to pay for all these advances. This in turn will increase costs even more for those who can afford to pay until they can no longer afford it either. In the process, many will actually see the healtcare available to them become even more limited, and eventually we will begin regressing instead of progressing when it comes to our overall health and longevity.
To actually hit 100% on health care expenditure would mean that spending on even food would have to cease to exist.