Health Care in Crisis: How Special Interests Could Double Health Costs and How We Can Stop It

2009-01-28

Executive Summary

Our health care system is in crisis.
Without swift action, that crisis could threaten every Illinois family’s health and finances.

Unless the new Congress and Administration act to reduce health care costs, the yearly cost of the average employer-paid family health policy in Illinois is projected to more than double from $11,781 in 2006 to $25,409 by 2016 even after adjusting for inflation. If recent trends continue, wages and household incomes will simply not keep up with these high costs. Nor will the business sector be immune to this crisis. Unchecked, this cost epidemic could also severely impact the small businesses that drive job creation in Illinois' economy.

Unfortunately, too much of these astronomic costs are going to enrich special interests, not buy the best health care. The Congressional Budget Office estimates that nationally as much as one third of health care spending is wasted and does not improve outcomes. That means that, in 2007, one out of every three dollars that Americans spent on health care, or $730 billion, went to the insurance bureaucracies, drug companies, medical device manufacturers, and providers without improving a single person’s health. In Illinois, one third of health spending amounts to $22.43 billion.

This report examines three important sources of this unproductive spending. We conclude with a package of urgently needed reforms which target those causes, improve quality of care, and rein in this unnecessary spending. As part of 4 comprehensive health reform, these policies will enable America to emerge from this crisis with a health system that consumers and businesses can afford and families can depend on.