Question

why does the U.S. spend an ever-growing portion of its resources on medical services, although they are less cost-effective than other methods in improving health status?

please provide 3 references

Answer 1

Overview
At 18 percent of America’s economy and growing 2 percent faster than Gross Domestic Product, both the level and rate of growth of national health care spending are seen as alarming. While this isn’t a new problem, the amount of spending on health care, combined with the country’s fiscal challenges, makes the need to contain health care costs a national priority requiring a sense of urgency. High health care spending is exacerbating the government’s strained fiscal situation and is hurting the standard of living for many Americans.
There are many key drivers of America’s high and rising
health care costs. Among them are medical technologies;
growth in the number of individuals with and the treatment prevalence of chronic diseases; a fee-for-service payment system that incentivizes volume and doesn’t encourage or reward coordination, integration, or management of health care delivery; the high price and high intensity of care; lack of patient engagement; and lack of evidence on the relative effectiveness of various treatment options. Controlling costs requires decreasing waste; reforming the payment system to change incentives; changing the delivery system to improve coordination and integration; managing costly patients with chronic diseases differently; engaging
patients and families in shared decision making, particularly at the end of life; and many other discrete activities. The good news is that many activities already are underway. These include initiatives by the federal government, by state governments, by private payers, and by local communities. There are numerous pilots underway, multiple successful initiatives taking place, and a great deal of positive momentum. In addition to pushing for payment and delivery system
reform, among the key challenges is spreading what works.
Controlling costs while reinventing the health care system is a never-ending pursuit that requires collaboration among all of health care’s key stakeholders.

The Problem
In framing this series of briefings, Ed Howard, executive
vice president of the Alliance for Health Reform, said that
the problem of high and rising health care costs isn’t new.
He read from a 1932 report from the Committee on Costs
that stated, “Many persons do not receive service which
is adequate either in quantity or quality, and the costs of
service are inequibly distributed. The result is a tremendous
amount of preventable physical pain and mental anguish,
needless deaths, economic inefficiency, and social waste.”
Progress Has Been Made
Much progress has clearly been made since 1932. Kenneth
Thorpe explained that between 1940 and 1990, the unin-
sured portion of the U.S. population declined from 90 per-
cent to 15 percent, Medicare and Medicaid were launched,
and numerous new technologies and treatment innovations
were developed. As a result of countless new technologies, there has been a significant increase in the treatment prevalence for diseases such as diabetes, hypertension, arthritis, and cancer.
Joseph Newhouse pointed out that just since 1970, life
expectancy in the United States has increased from 70.8 to 78.2 years. Jim Fasules of the American College of Cardiology said that in just the past decade there has been about a 30 percent decrease in mortality from cardiac diseases, likely as a result of treatment. And Gerry Shea of the AFL-CIO stated that a sea change has occurred in health care delivery with its current focus on quality, including measurement of quality, changing care delivery based on quality and even increasingly linking payment to quality
measures—something that previously would have been
unthinkable.

The Costs of Health Care in America Are Unsustainable

While the benefits of improved health care are significant,
the costs of health care are immense.
Michael Chernew shared data showing that in 1960,
national health expenditures represented around 5 percent
of U.S. GDP, and now account for about 18 percent of
national GDP. In addition, as Paul Ginsburg stated, the trend
for health care spending is growth of 2 percent greater than
GDP growth. Multiple presenters and respondents termed
the current cost situation unsustainable for all stakeholders:
the federal government, state governments, private health
plans, employers, and consumers.
Dr. Ginsburg said that because of the major fiscal challenges
faced by the federal government and state governments,
“There is an urgency for cost containment.”

Increased Costs Have Significant Consequences
The high amount of spending on health care and the rate of
growth of such expenditures have significant potential con-
sequences, some panelists said. Among the consequences
they listed are:
Higher taxes. If public health care spending is financed
by taxes, marginal tax rates for high-income earners could
rise to 70 percent by 2060.
Lower GDP. High health care expenditures and taxes
could cause GDP to decline (related to trend) by 11
percent.
Decreased employment. Helen Darling of the National
Business Group on Health said private spending on health
care is unsustainable. As a result of health care costs,
which increase the cost of labor, as well as the impact
of the Great Recession, many large employers are not
creating jobs. Over the past five years, many firms have
reduced headcount and decreased hours. She noted that
health care costs are not the only factor driving this trend,
but are a major factor.
A lower standard of living. In the 1940s, about 5 percent
of per capita income growth was devoted to health care;
the other 95 percent could be devoted elsewhere. Even
in the 1980s, about 25 percent of income growth went to
health care. But from 2000 to 2009, more than 90 percent
of “our increase in wealth went to health care,” Michael
Chernew said.
Employers have held down wages, decreased coverage,
dropped coverage altogether, and/or shifted a greater por-
tion of health care costs to employees. This has affected
and will continue to affect the standard of living of
Americans.

Drivers of High and Rising Costs
Beyond the basic concept of price and quantity, speakers,
respondents, and participants offered several factors respon-
sible for high and rising health care costs. Among them are:
Intensity of care. Gail Wilensky sees the intensity of
care as a major driver of cost. While the United States has
shorter lengths of stay in hospitals than in other countries,
and Americans see physicians less frequently, when an
individual does have an encounter with a hospital or phy-
sician, the system “goes gangbuster.”
Lack of coordination. The fragmented, uncoordinated
delivery system has been comprised of silos, which has
increased costs and inefficiency. The historic fee-for-
service payment system has not provided any incentive to
improve coordination. The lack of coordination has both
driven up costs and hurt the quality of care delivered.
One example where coordination has been lacking,
provided by Melanie Bella, is for the nine million dual
eligibles, who participate in both Medicare and Medicaid.
These individuals tend to have multiple chronic condi-
tions (55 percent have 3 or more) and tend to be high-
cost, high users of technology. The fragmented, uncoordi-
nated payment and delivery systems exacerbate the costs
through inefficiencies, including duplication of service.

Lack of patient engagement. In many instances, particu-
larly at the end of life, patients and family members are
often not engaged in shared decision making with their
care provider. Providers may not do a good job of asking
or understanding what individuals really want, which is
often not more tests and procedures. As a result, services
are rendered and costs are incurred while not providing
the care and comfort that patients actually want.
Thinking medically, not functionally. Providers often
view patients only in medical terms, seeing a patient
based on his or her disease and treatments. An individual
usually thinks about his or her daily life and how to have
an independent, dignified existence rather than about
medical interventions. Bruce Chernof stressed that a
medical approach can lead to excessive costs and inappro-
priate care versus thinking about individuals functionally.
Medical education. Former American Medical Associa-
tion President Nancy Dickey said that medical educa-
tion teaches new physicians how to use various medical
technologies, but fails to teach when to use these tech-
nologies—and when not to use them. She views the focus
of medical education as driven by the historical incentives
and culture of health care. Changing the education and
behavior of new physicians requires changing the incen-
tives so that doctors will know not just how to use new
medical technologies but when and when not to use them.
Lack of evidence. A driver of increased costs is a
shortage of evidence regarding which technologies and
interventions are effective and provide value. While the
basic concept of generating evidence through compara-
tive effectiveness research is appealing, Joe Antos argued
that: effectiveness is not the same as value; research can’t
move fast enough to keep pace with continual change;
research at best reflects average patients and provid-
ers, not real-world situations with significant variation;
and often glamorous drugs and devices get attention
before other, perhaps simpler and cheaper methods. For
these reasons, he sees lack of evidence contributing to
increased costs and doesn’t see effectiveness research as a real solution.

Reference

Major reference was a pdf file. I couldn't attach its link.

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5394555/

https://www.pgpf.org/blog/2020/04/why-are-americans-paying-more-for-healthcare