Bottom Line: Medicine’s Funding Pool is Drying Up

Special Report from Stanford Medicine, Fall 2012

If you don’t have your health, you don’t have anything. Unfortunately, in the United States protecting this most precious asset is breaking the proverbial bank. This is not news. In fact, decades have rolled by while the nation’s health-care bill has ballooned. Most of us try not to think about the facts, but we ignore them at our peril. A few stunners:

-          U.S. health-care spending neared $2.6 trillion in 2010, which is 17.9 percent of the nation’s gross domestic product. This translates to $8,402 per person.

-          More than 75 percent of U.S. health-care spending is due to chronic conditions, which are expected to become even more prevalent as the baby boomer generation ages. In 2000, 125 million people suffered from chronic conditions; by 2020, that number is projected to reach 157 million. 

-          Competition for biomedical research funding has become cutthroat. At the National Institutes of Health, the world’s biggest funder, requests for dollars rose from 3.6 times the supply in 1998 to 6.5 times the supply in 2011. Driving this dynamic is a huge increase in applicants: from about 19,000 in 1998 to approximately 32,000 in 2011. 

-          Meanwhile, the U.S. economy is stagnant, which means it’s unlikely the government will pick up much more of the tab for health-care costs. It also means there’s little chance that funding for biomedical research will return to the rapid growth it enjoyed in decades past. When adjusted for inflation, NIH funding is back to where it was a decade ago. And not surprisingly, the United States, long the world’s leader in biomedical research, faces challengers. The Chinese government’s spending on medical research, for example increased 67.3 percent between 2009 and 2010.