Imagining 16% to 12%

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By Bruce S. Pyenson, Kathryn V. Fitch | 01 February 2009

"Imagining 16% to 12%" articulates a vision for US healthcare, applying actuarial methods to extrapolate nationwide efficiency goals based on the experience of the highest-performing care delivery systems. These systems have something in common—more efficient utilization of care and better outcomes—so rather than suggest reducing payments, this vision sets efficiency goals through improved utilization and quality. Taken as a whole, this vision not only shows how far the US might go in reducing overall national health spending; it also suggests a path for covering the uninsured and improving quality.

The percentages in the report title are national health spending as a percentage of GDP—both what the US pays now and what the US might strive to pay. Even if we devoted only 12% of our GDP to healthcare, we would still pay more than any other country. This fact offers compelling evidence that our vision is more than just an abstract target.