Taxes – that’s right, new taxes! – for public health

With just 3 percent of all health expenditures in the U.S. going toward agencies whose primary mission is prevention, a new report proposes a national tax on all medical care transactions.

by Michael Yudell

Published Apr. 17, 2012, 6:30 a.m. ET

Flagging the "large proportions of the U.S. disease burden [that] are preventable," the report recommends doubling federal funding on public health from $11.6 billion to $24 billion per year. Of the $2.5 trillion in annual medical spending in the United States, only 3 percent goes to government public health activities. That's $8,086 in total health expenditures per person, compared to $251 "spent on public health by federal, state, and local governments." Public health remains woefully underfunded, and disease prevention efforts, funded primarily by federal, state, and local governments, continue to suffer.

This third report is sure to generate controversy - or perhaps fall on deaf ears - given its core recommendation: to finance the needs of public health in the 21^st century, the federal government should enact a national tax on all medical care transactions. Also sure to be controversial is the report's recommended shift in current public health funding. It recommends that state and local public health funding currently used to pay for clinical care should be used instead to pay for prevention and health promotion activities by public health departments. This shift, however, will not result in a net loss of funding for clinical care because under the Affordable Care Act clinical care in a public health setting will be reimbursable by Medicaid or state health insurance exchanges.

As the report says, "a growing body of evidence indicates that effective prevention strategies can substantially improve health with little or no additional lifetime spending." It all seems so obvious. Tobacco control reduces deaths from a wide range of diseases including cancers, stroke, and heart disease. Immunizations reduce deaths from formerly deadly infectious diseases like polio, pertussis, and diptheria, and seat-belt laws reduce injuries and deaths from motor vehicle accidents.

Whoever is elected in the fall would do the nation's health well by taking a closer look at these recommendations. They make financial sense because they save us money over time in overall health care costs. They make health sense because of the improvements in health they would bring. And, they make political sense, given the creation of public health jobs, quality of life improvements, and overall health improvements that would follow in their wake.

Based on past experience, both Barack Obama, in his shaping of the Affordable Care Act, and Mitt Romney, in his support for the Massachusetts law on which it was based, understand the importance of these issues. Whether they or any other politicians are courageous enough to take up the cause of public health in the near future is another question. Sadly, at this moment, I am not at all hopeful.