Cost Curve In Health Care

Rising health care costs became an issue after the Medicare and Medicaid programs were formed in 1965 and have continued to be a factor in the United States economy since then. “By1970, U.S. government expenditures for health care services and supplies had grown by 140%, from $7.9 billion to $18.9 billion.”() By the 1990s the annual increase in the government health care expenditures was finally brought under control and has fluctuated between a 5% and 8% increase each year since then. This essay will discuss the different factors contributing to the rising costs of health care in the United States, as well as how the cost of health care affects the accessibility and quality of medical care throughout American history.

Health care costs are a longstanding concern to policymakers. For years, health care spending has been rising faster than the rate of economic growth, raising the question of what factors are responsible for rising health care costs. This paper explores published articles that report results from research conducted on technological innovations in health care and its relation to rising health care costs. The cost increases have a significant effect on households, businesses, and government programs. Health care experts indicates the development and diffusion of medical technology as primary factors in explaining the persistent

“The amount people pay for health insurance increased 30 percent from 2001 to 2005, while income for the same period of time only increased 3 percent.” (Source: Robert Wood Johnson Foundation). The rising cost of healthcare is a huge problem in America today. In this paper I will analyze the different issues and causes for the increase in cost.

The costs associated with Medicaid have continued to increase over the years, consuming a larger amount of both federal and state budgets throughout the country. There are now worries about Medicaid eating up state budgets throughout several states. In Kaiser Health News, Rau (2013) reported that "health spending will rise faster than economic growth." With such a significant increase in Medicaid costs, there is the danger of notable shortfalls within the Medicaid spending at the state level. Without adequate reforms, the costs associated with Medicaid threaten to consume a larger portion of state budgets, which could sequentially affect other budget items. An increase in the number of enrollees, growth in provider payments, and an increase in healthcare costs are some of the main reasons for an increase in Medicaid costs. The intricacy of the Medicaid costs problem within the United States is made worse by a decrease in state funds.

The first concern that is affected by cost shifting lies in the Medicare system. Medicare is provided to individuals who are 65 and older to obtain adequate healthcare, as well as decreasing financial worries. The government’s involvement in controlling the healthcare system can be a major disadvantage to the Medicare system, as well as private insurances. Reimbursement from private insurances and Medicare can be affected so severely that obtaining access to Medicare can become a major issue. Furthermore, the repercussion is illustrated by Dr. Lichter’s statement, “Either something happens or the healthcare system is threatened.” Without cost containment, there will be major shifts of costs to private payers and Medicare beneficiaries” (Hayes, 2008).

One of the key aspects that lead to the financial hardships of Americans when it comes to healthcare coverage is the expensiveness of the coverage. The expensiveness of the coverage can be attributed to quite a few factors that directly and indirectly raise the cost. The number and type of technology used in hospitals, clinics, and other medical institutions absolutely affect the rising cost in healthcare (Ferlie &

Advances in technology are a primary reason for the high cost of health care. The book, Health Care USA: Understanding its Organization and

The nation health care system is facing significant challenges that requiring immediate major reforms. Lately close attention is drawn to the uninsured Americans, such as the most painful dilemmas of health care system. The problem of uninsured and uncompensated care continues significantly contribute to the rise of the health care cost and has been a chief topic for public debates and political campaigns for a long time. The purpose of this paper is to describe the current extent of uninsured care and provide the strategies from the nursing point of view how to change the trajectory of this prevalent issue in the USA health care system.

In my opinion, I believe the following national trends affect competition and pricing, access to care, technology, shortage of physicians & reimbursement. Access to care and shortage of doctors increases the competition for consumers. Physicians have to work harder to attract patients to remain relevant in the market. Technology is also important since the organizations that use technology will be more sort after. According to Harris (2017), In some instances, the reimbursement process is now linked to patient’s satisfaction, and this will factor into how the physicians receive payment. These trends occur nationwide and cause both the competition and pricing will continue to vary. Healthcare is an industry that is constantly evolving; therefore,

Health care is something we all must be concerned with. Costs are constantly rising and most plans demand a huge amount of money in regard to deductibles and out of pocket max. However, there are some simple ways you can begin controlling health care costs. Keep the following in mind when you are going through this process.

Political ideology, culture, demographics, economic development, and technology all influence the health care policy process throughout the history of the U.S. (McLaughlin & McLaughlin, 2014). For example, after the great depression, the U.S. government passed Medicare that financially used a fee-for-service system encourages more tests and other medical care to be performed to try and earn more revenue for the physician, which leads to an increase in medical costs. The government has helped to reduce healthcare cost by using bundle payment system that uses DRG as a form of payment for services provided by physicians, hospitals, etc. Medicare’s capitated bundled payment system to pay for home health services helps to reduce health care cost. Home health services take up 40% of Medicare’s expenditures and any reduction in the amount paid for this service can help provide more services to the elderly population (Hicks, 2014). The government promotes using a gatekeeper to help control unneeded specialty physician care that costs more for services. There is more of a focus on reducing service at the same time as improving the quality of care by giving incentives for

Health care cost is defined in three meanings. One is price which consist of physician’s bill, prescription bill, premiums. Second one is national perspective means how much a nation spends on health care that is health care expenditure and the last one is provider perspective which is cost of production.

In the new report releases on November 2013 of The Council of Economic Advisers, “Trends in Health Care Cost Growth and the Role of the Affordable Care Act”, shows the health care costs and prices are growing at their slowest rates in decades. The chart, “Real Per Enrollee Growth in Health Spending Per Payer,” in this report shows that the average annual growth rate of private insurance from 2010 to 2013 was just 1.3 percent, marking the lowest rate record and “less than one-third the long term historical average stretching back to 1965” (Trends in Health Care Cost Growth). This report also indicates that the ACA reduces the expenditure for health care and puts the inflation in the lowest rates (only one percent) in the recent fifty years (Trends

Pricing is one of the main factors of a successful marketing mix. Pricing tactics, strategies, and objective, cannot stand alone. In order to be effective, price must work together with other management and marketing activities. When you use pricing as a tool in management it is limited in health care compared to other industries. There are several factors that contribute to this situation, like the development of the health-care exchange process, limited consumer knowledge, and a limited ability to measure costs.

If you look anywhere in the world, in any type of business model, you will most likely see some kind of cost shifting. How much cost shifting is multifactorial, but is most likely present in some way. We saw it in retail as the cost of fuel rose to over $5 per gallon, the trucking companies had to charge more to the manufacturers to cover the increase in fuel, which then the manufacturers passed that increased cost onto the individual stores which in turn passed that increase cost onto the customers which were buying the goods. This is a little different in healthcare, however the general idea is the same.