The acceleration of healthcare costs is the biggest driver of our deficit. The United States spends 18% of its GDP on healthcare. Healthcare costs per person are expected to exceed $10,000 this year. According to the OECD we spend roughly twice what other countries spend per person on healthcare and yet our health outcomes are not at the top of the OECD (developed) countries. Our infant mortality, hospital visits per thousand, longevity of life, and other critical health statistics are average among OECD (developed) countries. We need to repeal Obamacare and eliminate the myriad of unnecessary and sometimes unwanted mandates. We need to reform our malpractice system which drives huge unnecessary expenditures on defensive medicine. We need to purchase our prescription drugs at competitive pricing. Currently we pay dramatically higher prices than all other health care systems and subsidize research and development for the rest of the world. We need to embrace big data in the analysis and treatment of diseases which should provide enormous savings. We need to encourage discussions of end of life decisions and the use of living wills. A disproportionate amount of healthcare cost occurs in the last six months of life. Frequently, decisions are made by family members rather than patients. The decisions often do not promote dignity and would not have been chosen by the patient if they had considered the issues in advance. Death must not be treated as a dirty subject. It should be discussed and addressed. We need more information on price and quality available to consumers and they need to be incentivized to shop on price. Currently consumers typically get little benefit if any from shopping under their insurance plans.  Health savings plans are tax disadvantaged unless they are accompanied by a traditional health insurance plan. Providers must also be encouraged to compete based upon transparent pricing. We should defund Planned Parenthood and all international assistance which directly or indirectly can be used for abortions.

If we incorporate these market mechanisms and cost savings initiatives we should be able to reduce health care costs to the level of the next closest country to 12 % of GDP. This would provide a savings of $3500 per person in the United States or close to a trillion dollars. If we apply this to 135 million of people covered by the federal government in Medicaid, Medicare and veterans the savings would be over $470 billion per year. I have assumed we only get to 14% of GDP leaving America with still the highest cost healthcare in the world. This would still provide a savings of approximately $300 billion per year. This is the most critical component of the deficit turnaround and must be addressed immediately. Reforming health care costs will also lead to substantial job creation in the private sector, which has to carry an unfair burden of covering high healthcare costs per employee vs. our international competitors.

It all starts with a repeal of Obamacare! Savings $300 billion/yr.