The McKinsey Quarterly has just published a report called Health Care Costs – A Market View.
Basically it shows the past and future trends.
For the past 50 years, health spending has grown by 2% in excess of GDP growth across all Organization for Economic Co-operation and Development (OECD) countries.
McKinsey takes the past 50 year growth patterns and shows what happens if the trend continues.
What better way to ascertain whether the OECD health systems are broken?
The projections show around 40 years from now, most OECD countries will have reached 20% GDP being spent on health.
The UK is already around 8% GDP and its health system is already under strain. The notion of this 8% becoming 20% GDP is unthinkable. It simply is not affordable. Therefore, the health system is broken. Something has to dramatically change before a tipping-point is reached, leading to a crises similar to today’s credit crunch, except it will be a lot bigger and a lot more serious.
But these projections are more worrying when one examines those countries that already have over double the UK health expenditure. The one country that stands out is the USA.
The USA health expenditure already is around a colossal 17% of GDP. No wonder health in the USA is political dynamite.
The McKinsey projections, based on past trends, indicate that by 2080, the USA will be spending more than 50% of its GDP on health. This will not happen. The USA would be bankrupt well before this number is reached.
In reality, this problem is even more serious for the USA today than these figures show.
In 2006, 15.8% of the USA population had no health insurance policy. That means in 2006, 47m USA citizens were relegated to ‘your are on your own’ and ‘go find a charity’, which is closer to many poorer regions across the planet. The number of USA citizens without insurance may already have reached or passed 20%, but we have to wait quite some time before the figures are known for 2008. Remember, 2006 was the ‘good’ times.
This situation is further compounded by the number of USA citizens that have inadequate health insurance.
The McKinsey study was unable to factor in the latest market conditions before this report was published. Therefore, what does the credit crisis mean to OECD GDP heath trends?
The illiquidity in the financial markets on a global scale is shrinking OECD GDP figures.
Yet, the health expenditure continues to rise.
This means the health GDP spend will already be a greater percentage and indeed could rise sharply for some OECD countries. The critical question is how much closer we are now to the tipping point, before health GDP expenditure has a negative impact upon OECD sustainability and a new global crisis emerges.
In reality, the OECD health systems are already broken in the same way as toxic securities broke the financial systems some time ago, but no one was bothered until the terminal sirens started late last year.
Urgent new innovative solutions are needed now.
Health needs to move from knowledge illiquidity to knowledge liquidity on a global scale so the world’s population en masse moves towards preventative and curative self-help systems.
This benefits richer and poorer countries alike as both are in the same health crises boat but for different reasons.
Health knowledge is likened to money. Illiquidity is bad. Liquidity is good. Today, health knowledge is illiquid. Everyone should have the right to interact with health and medical expertise when they need.
This means one needs to shift from knowledge illiquidity to knowledge liquidity for solving this global health crises.
This can only be achieved with technology.
Artificial Intelligence is the ‘acquisition, application and measurement of knowledge’. AI is needed for knowledge liquidity because the costs and scarcity of human expertise prohibit more conventional solutions.
Indeed, ai agents combined with other technologies, such as Cloud Computing, Mobile and Virtual Worlds for immersive engagement and executed through controlled open-sourced manufacturing, provide the means to deliver health knowledge liquidity on a global scale.
This is no longer a technology or social networking challenge as all the pieces are there today.
This is a challenge for global leadership.
Local and global health systems need to be re-drawn by governments and markets.
Who will step forward or do we just wait for an even bigger crisis to emerge?
