Over the past few months or so an interesting term has come into use: ‘trickle-up economics.’ Though the term is by no means new, nor is it particularly original, it is getting new attention from commentators and satirists ranging from Dana Gould to Jon Stewart from the Daily Show. What is of interest to us, though, is the rather tongue-in-cheek application of the terminology to the American health care system.

I’m sure that most, if not all, of the readers here are familiar with the Reagonomics era model of “Trickle-down economics.” As one could guess, trickle-up economics is a satirical model that economics works from the bottom segments of the market to the top.

There have been two separate uses of the term. When President Obama talks about “grass roots” economic growth he is highlighting the fact that when provided properly-aligned incentives, the production of wealth can move up the economic ladder from the micro-level of the working class (middle-class families) to the macro-level national economy in terms of GDP/GNP generation.

In this video clip, Dana Gould reports on the state of health care in our country. His references to a trickle-up system, though, are related to how health care expenses (and revenue for that matter) are floated up the system from individuals to employers to insurers to the government. What’s even more destructive is that every single tier of this system is motivated to defray and displace the costs of providing health care to the other tiers.

In the next post I will attempt to outline the way in which health care costs move from the individual, micro-level to the final purchaser (or reimburser) of health care, the American government. Each time the expense is passed on to a new body in this perverse economic system, it grows more costly and/or inefficient.