In an interesting post today on The Health Care Blog, author and Wired editor Thomas Goetz analyzes why technology drives down costs in nearly every sector of the economy but health care. He writes:
The answer boils down to what’s called "scale" - the notion that technology, thanks to Moore’s law and other exponential improvements, gets progressively cheaper, better and thus more accessible. Cheaper and faster chips, sensors and storage mean that digital technology is constantly scaling up and out, touching the lives of more people. These improvements in cost and power are the democratizing force that has propelled GPS from a military technology to a cellphone feature, and they’re what helps Apple convince us to buy a new iPod every 18 months. Scalability is the secret sauce of the digital revolution.
Except in healthcare. In healthcare, technologies that scale are suspiciously hard to find. There's no lack of technology, it's just that they don’t seem to get cheaper and better at the same exponential rate as in the rest of the universe. This is especially strange because CT scans and pacemakers - to take two frequently blamed cost-generators - rely on the same digital technologies that are getting cheaper outside of healthcare.
Previously: Biomedical innovations and future health-care spending
