Providers are paid to intervene, not prevent. Patients reach for a pill, not a lifestyle change. Payers reduce their own costs by shifting the burden onto patients and providers. Life sciences companies price to what rebate structures and patent exclusivity will bear, not to the value delivered. As it stands, no one is incentivized to improve health. As a result, costs continue to rise, access worsens, health outcomes stagnate and resources are allocated inefficiently.

This installment of the Trends Shaping the Health Economy Report highlights six trends that reveal the nature of the tragedy:

1. 01 a series of unintended consequences that produced a system no one designed and increasingly few can afford;
2. 02 a population whose health is declining faster than a sick care system built to intervene, not prevent, can respond;
3. 03 a supply of care built around what is profitable rather than what is needed, leaving primary and preventive care chronically scarce;
4. 04 a marketplace that has never defined, and therefore does not measure, whether what it delivers is valuable;
5. 05 an incentive structure so misaligned that fraud, waste and abuse have become systemic rather than exceptional; and
6. 06 a reckoning now arriving from outside the system, as cost controls collide with a health economy that is no longer organically growing.

Because of the scope of the health economy’s tragedy of the commons, reform is inevitable. The question is whether change is pursued proactively from within the system or imposed externally through government intervention. Who will assign ownership, cost and accountability to the parties that have so far escaped them, and which stakeholders will be impacted the most?