What would happen if we developed a pill that would let us live to 120?

The dirty little secret of public health finance is that cigarettes are a very cost-effective killer. Living longer is great for society but a disaster for government programs.

This technology is valuable because it will improve health and extend lives. But we need to begin thinking about how to pay for it.

[Another question is how to change incentives for developing the technologies in the first place.] In the automotive and consumer-electronics industries, there are incentives to develop good, cheap DVD players or good, cheap cars, ... When it comes to medical technology, there is no incentive to develop something that's pretty good but less expensive because the people who are buying it don't pay for it. It's not surprising that everyone wants a Cadillac instead of a Hyundai.

That's true even for people with chronic illnesses like asthma, diabetes and heart conditions. When people have to pay more, they are less likely to adhere to their regimen.

If just a few of the promised technologies come on line, then Medicare and the entire society could face substantially increased health-care spending. We need to worry not only about the demographic risk [posed by the aging of the baby boomers], but also the risk of developing new technologies that appear to break the bank.