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Federal Reserve Board Chairman Jerome Powell testifies before the House Financial Services Committee in the Rayburn House Office Building on Capitol Hill February 27, 2018 in Washington, DC. Powell testified abou the Federal Reserve's semi-annual monetary policy report to Congress and the state of the economy
- Fed Chair Jerome Powell said at a Senate hearing on Wednesday that Americans are "getting nothing" in return for what the US spends on healthcare.
- "The outcomes are perfectly average for a first-world nation, but we spend 6 to 7% of GDP more than other countries. So it's about the delivery. That's a lot of money that you are effectively spending and getting nothing," he said.
- Studies have indicated that the US spends far more on healthcare compared to other developed countries only to achieve worse outcomes.
- One study published last year in a medical journal estimated that nearly a quarter of the US's $3.6 trillion health spending is wasteful.
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The United States is one of the highest spenders on healthcare for its citizens, but it has very little to show for it, Federal Reserve Chairman Jerome Powell said on Wednesday.
Powell made the brutal comments during a Senate Banking Committee hearing on monetary policy.
Republican Sen. Ben Sasse of Nebraska asked the Fed chair to weigh in on the effect of American healthcare spending on the economy, and Powell responded the US is spending at far higher levels without much to show for it.
"The outcomes are perfectly average for a first-world nation, but we spend 6 to 7% of GDP more than other countries. So it's about the delivery. That's a lot of money that you are effectively spending and getting nothing," he said.
The Fed chair added that developed countries have been more successful in delivering quality healthcare for much less.
"It's not that these benefits are fabulously generous, they're just what people get in Western economies," Powell said.
It's not the first time Powell weighed in on the rising price tag of American healthcare. In a 2018 interview with Yahoo News, he warned it could hurt the country's economy in the future.
"It's no secret: It's been true for a long time that with our uniquely expensive healthcare delivery system and the aging of our population, we've been on an unsustainable fiscal path for a long time," the Fed chair said.
US health spending grew 4.6% in 2018, according to the Centers for Medicare and Medicaid Services, reaching over $3.6 trillion, and it has been swelling for decades.
The US spends around $10,227 per person for healthcare, twice as much compared to other developed countries, according to the nonpartisan Kaiser Family Foundation. But it ranks poorly in health outcomes, particularly on infant mortality and deaths from preventable causes under age 75.
One study published in the Journal of the American Medical Association last year estimated that nearly a quarter of that spending - up to $935 billion a year- is wasteful, with failures of care delivery and coordination eating up most of the nation's mismanaged health expenditures.