Broker Check

The Crisis in Healthcare

August 16, 2022

Robert Pearl, M. D. a Forbes healthcare contributor on the Stanford faculty has published an article on LinkedIn on the crisis in American healthcare. 

Our system is the most expensive and least effective in the developed world. Price escalation, eroding quality and misused technology were issues even before the COVID-19 pandemic. Now Dr. Pearl predicts three "mega forces" will produce a medical disaster more destructive and costly than COVID-19, unless met with urgent and radical solutions.

The three mega forces:

1. Untamed inflation. Unlike consumer prices which can adjust fairly quickly, healthcare prices are set one or two years in advance and hold firm for a similar period. Labor, material and supply chain expenses will explode and make healthcare prices unaffordable.

2. Nursing shortage. Between retirements and resignations, nurses are in short supply especially in operating rooms. It takes time to train new nurses. Raising salaries increases costs, while holding them down leads to more nurses quitting. Lack of nurses results in poorer patient care.

3. Burnout. This was a crisis for doctors before the pandemic. The shortage of nurses and staff, plus cost cutting by insurers and administrators has made it worse. Doctors call concern with profits over patients and lack of respect "moral injury". Physicians are turning to private equity firms for better compensation and greater control. This only intensifies the cost crisis.

The complete article, "These 3 Healthcare Threats Will Do More Damage Than Covid-19" is at Dr. Pearl has promised solutions in a future article.