U.S. Spending on Healthcare Hit $2.6B in 2010

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Nov. 13 (Bloomberg) -- MIT Technology Review Editor-In-Chief Jason Pontin discusses the high cost of health care in the U.S. with Deirdre Bolton on Bloomberg Television's "Money Moves." (Source: Bloomberg)

Why are our drugs so expensive erie it i noticed something to do with r&d costs.

Why does and that it mitigated over time.

Because they are now extremely targeted.

Drugs are becoming increasingly effective and they are becoming effective with smaller and smaller populations.

At the same time, the drugstore cost $1 billion to develop.

$2 billion.

The truck companies argue they have to recoup that cost and they cannot look to foreign markets which have price controls to recover those costs.

When you look at the u.s. and do look at other countries, why is the u.s. so bad at this calculation?

We spend the greatest percentage of an industrialized nation -- percentage of gdp, on health care.

And we still have a c plus is some.

I think it is worse than that.

Why some measures we are in the 20th or 40th rank and yet no one spends more than we do.

It is not just the prices of drugs which you could justify at some level.

The american health care system is so inefficient because of waste and effective treatments and sheer bureaucracy.

If we try to create a worse health care system, we really couldn't have come up with anything much a veteran than what we have at the moment.

We combine all of the inefficiencies of a state-run bureaucracy with some of the -- of an inefficient market based system.

What is the solution?

Do we love to our neighbor to the north?

Do we look to the u.k.? are there models out there of other industrialized nations that are running more efficiently and if so, how are they doing it?

That is an interesting question.

I don't get asked that on television.

One of the bizarre elements about the health-care debate we have had in this country about obamacare is that there are in fact is particularly effective health care systems that do effectively combine private and public market medicines -- mechanisms.

Taiwan is extremely effective and has very good health care outcomes.

Switzerland is sometimes pointed to as is germany.

If you want a single-payer system without any market interference, francis always held out as a model of a state- run organization.

In the american health-care system, the people who prescribed the drugs, doctors, have very few market controls over them.

The organizations that repay the prices, the insurers, are not the ones making the health care choices.

The individuals, the people who are receiving the health care no market constraints at all.

This tends to add up.

We have to leave it there.

Back in one minute.

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This text has been automatically generated. It may not be 100% accurate.

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