Headlines such as “Ageing Boomers to cost us nearly $1.8 b” (CT Sat 22nd) are misleading and incorrect. The headline should say, “Older People may spend more on health care”.
The headline arise from antiquated accounting practises – not the likely cost of future health care. Our current health accounting procedures, used by Health and Treasury planners, assumes we have to save money for our future health care before we need the care.
Rather than trying to save an unknown amount of money for health care we can use “just in time” financing. When an old person (or a young person) needs medical help then they can get an interest free loan that they pay back from their future income when they are well again. If the person dies the loans are paid back from their estate. We can control the amount of funds by giving everyone – depending on age and health – a yearly accumulating amount of health credits.
Infrastructure can be built before the facilities are needed by people buying priority access with some of health credits.
Doing things this way removes the need for most health insurance. People can still take it out for queue jumping if they wish. Governments do not have to collect taxes up front to build infrastructure and importantly we do not have to pay the rent seekers unnecessary interest.