I discussed in the past how the influx of baby boomers and our increased longevity due to medical successes will place a major stress on the cost of providing healthcare. In a recent Wall Street Journal article, Theodore Dalrymple, a pen name for Dr. Anthony Daniels, illustrates the point nicely. He discusses the attempts to introduce efficiencies in the British healthcare system and how these efforts have failed. It seems that even with the best intentions and the explosion of generic drug use the cost of healthcare continues to inexorably rise.

It’s becoming clear that things have to get much worse before there is any hope of them improving. The bright spot in all of this, is that after the dust settles a more effective and efficient system will emerge to take its place. In the shorter-term, unfortunately, I predict that we will go through a period of irrational cost cutting and rationing associated with a lot of hand-wringing. Eventually, although there will always be those who have the ability to afford more care and those that can afford less, rationing will be done in a way that provides more appropriate care, because the days of a system that tries to treat a limited resource as something unlimited is rapidly coming to an end.


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