The Health-Care Thing.

MEDICAL care costs; NATIONAL income; GROSS national product; BAUMOL, William J., 1922-2017; MEDICAL care; MEDICAID; MEDICARE; CONSUMER goods

The article comments on the economic implications of rising health care cost in the U.S. It reveals that health care spending has grown faster then national income which rises from 5% of gross domestic product in 1960 to 14% in 1993. This reflects the introduction of Medicaid and Medicare in the 1960s. Economist William Baumol points out that all countries have experienced rising medical costs. Furthermore, the trend in health care costs is the same with other services. If Baumol's idea is right, the same factors that push health care costs up will make it possible to supply the public with better health care in the future.