Clarifying “cost” and “spending”(or “price”)

Just a quick note, because this comes up all the time and I just noticed it in the comments. The words “cost” and “spending” sometimes confuse, but they shouldn’t. What I spend for a good is not its cost to the supplier. It might cost the baker $1 to make a loaf of bread. I spend $3 for it.

However, so long as it is clear from context, it is OK to write that my cost for the bread is $3. Likewise, the cost of health care to the taxpayer or to the citizenry is what we spend on it. That’s different from the cost to the suppliers of health care.

There’s no need to be confused about this. It should be clear from context what is meant by “cost.” Typically, when it comes to health care, what is meant is the cost to the payer, not the health care provider. Typically, when one means cost to the health care provider one says so explicitly.

When I write about health care costs I am almost always talking about taxpayer costs or premiums. If it is ever unclear, just ask. But please don’t assume I don’t know the difference between a cost and a price.

Update: Same goes for me!  – Aaron

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