Waste, We Know You Are Out There

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Abstract
Both presidential candidates have put forward proposals for curtailing waste in the U.S. health care system. Behind these claims are estimates that various medical procedures are used inappropriately as much as one third of the time in the United States. The director of the Congressional Budget Office, Peter Orszag, stated in August 2008 that “a variety of credible evidence suggests that health care contains the largest inefficiencies in our economy. As much as $700 billion a year in health care services are delivered in the United States that do not improve health outcomes.”1 Reports abound of needless or low-benefit procedures, some performed for fear of litigation, some out of venality, some demanded by importunate patients, and some representing the mindless repetition of established routine: “That's the way we do things here.” As is often noted, other countries spend less per person than we do and achieve equal or superior outcomes. That a first-class health system can be run for less than the United States spends — or a better system for what we actually spend — is undeniable. But what, really, do we mean by waste? Do we have the means to curtail it? How fast can savings be realized?

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