Economics Of Healthcare

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 spending in the United States of America as a percentage of the economy has reached astonishing heights, equating to 17.7 percent. This number is shocking when compared to other counties; in Australia health care is 8.9 percent, in United Kingdom 9.4 percent, in Canada 11.2 percent. If the American health care system were to hypothetically become its own economy, it would be the fifth-largest in the world. While these statistics sound troubling, they lead us to look for answers about the problems surrounding our system. The first health insurance company was created in the 1930s to give all American families an equal opportunity for hospital care and eventually led to a nationwide economic and social controversy that erupted in the 1990s and continued to be shaped by the government, insurance companies, doctors, and American citizens. In this paper, I will go in to detail about the various opinions regarding the controversy, the history behind health insurance companies, and the main dilemmas brought out by the health care crisis. Greedy insurance companies combined with high costs of doctor visits and pharmaceutical drugs or the inefficient hospitals all over America can only describe the beginning to this in depth crisis. Recently, the United States health care industry has become know for the outrageous costs of insurance models, developments of various social and health services programs, and the frequent changes in medicinal technology.

The purpose of this paper is to review and discuss the current level of national healthcare expenditures and to determine if we as Americans are spending too much on healthcare. The author of this paper will provide examples and solutions where we as a nation should add or cut from the healthcare expenditures. This paper will also detail how the general public's healthcare needs are being paid for, the biggest economic healthcare challenge, why the challenge should be addressed, and how this challenge to be financed.

The single most important impetus for healthcare reform throughout recent history has been rising costs (Sultz, 2006). In the book called The healing of America: a global quest for better, cheaper, and fairer health care, Reid wrote that the nation’s health care system has become excessively expensive, ineffective, and unjust. Among the world’s developed nations, the US ranks near the bottom for healthcare access and quality. However, the US ranks at the top for health expenditure as a percentage of the Gross Domestic Product (GDP) and average of $7,400 per person (Reid, 2010). Therefore, Americans are spending

The increase of expenses - As politicians continue their dissension amongst each other, the situation is worsening in our healthcare system. According to the World Health Organization, to achieve universal health coverage, countries need a financial system that enables people access to all types of health services without incurring financial hardship (Carrin, Mathauer, Xu, & Evans, 2011). This idea would be the foundation of innovative ideas that the U.S. could reform its healthcare system, but too many ideas are sabotaging any valid efforts. In the mean time, the U.S. healthcare system continues to deal with issues such as the increasing uninsured Americans (over 49 million), expensive administrative procedures and the inability to measure the accuracy of quality of care, access of care, and the increasing healthcare spending and financing that limit our ability to efficient utilize resources.

Healthcare in the United States has reached a level of complexity which has perplexed Presidents, Congressional members and private industry for over a century (Palmer, 1999). While the healthcare system has evolved over the last century, policy decisions which have attempted to effectuate changes to cost, quality and access have been

Rising medical costs are a worldwide problem, but nowhere are they higher than in the U.S. Although Americans with good health insurance coverage may get the best medical treatment in the world, the health of the average American, as measured by life expectancy and infant mortality, is below the average of other major industrial countries. Inefficiency, fraud and the expense of malpractice suits are often blamed for high U.S. costs, but the major reason is overinvestment in technology and personnel.Health care costs are far higher in the United States than in any other advanced nation, whether measured in total dollars spent, as a percentage of the economy, or on a per capita basis. And health costs here have been rising significantly faster

In the United States, health care has become a huge expense and has threatened the economy; additional measures need to be taken to address the rising cost of care. An individual spends an estimated eight thousand dollars a year in health care expenditures. Therefore, we need to recognize that how a physician reimbursement for payment has a vast impact on the economy and the rising cost of health care.

In 1998, the United States devoted 13% of its economy to health care, and this figure rose to 16% by 2008. However, despite this rise in government expenditure on health care, outcomes for patients remained the same (Obama, 2016). The quality of the health care system in general was not great; health care

There are 10 key economic concepts of health care. Each of the economic concepts is important when evaluating the different issues related to health care such as the increasing cost of health care. Henderson (2015), list the 10 concepts as follows: scarcity and choice, opportunity cost, marginal analysis, self-interest, markets and pricing, supply and demand, competition, efficiency, market failure, and comparative, advantage. The concept scarcity and choice address the issues related to the limited supply resources and the need to economize (Henderson, 2015). An illustration of the importance of the scarcity and choice concept is when there is a low quantity of available resources to meet the demand of individuals and rationing occurs. Opportunity cost emphasizes

With this definition, it’s easy to see that health care reform impacts the economics of health care in many ways. The most significant change is the decrease in health care disparities between those with private insurance and those with limited or no coverage. The ACA brings much-needed resources to those underserved groups. Even with the Medicare/Medicaid expansion and the addition of Marketplace insurance, disparities still exist. In my unit, patients with private health care can often not schedule their procedures immediately, while those with Molina and Care Source must try conservative therapy first. Overall, levels of disparity are improving, but the two health care delivery systems are not yet equal. Lawmakers should consider universal health care to provide equal access to health care for all citizens. Other examples of how health care reform affects health care economics include focusing on preventative care, moving from the fee-for-service model to one in which the provider is paid based on quality, efficiency, and value of care given, developing accountable care organizations in which health care networks and physicians join to deliver improved care at a lower cost, and incorporating a universal EHR which decreases costs by decreasing errors and decreasing the duplication of services (Ballotpedia, n.d.). Next year, Ohioans may feel

1A. Market failure is a situation in which the allocation of goods and services is not efficient. In any given market, the quantity of a product demanded by consumers does not equate to the quantity supplied by suppliers. This is a direct result of a lack of certain economically ideal factors, which prevents equilibrium.

Steven Brill feels that American health care is eating away at our economy and our treasury and discusses the costs associated with the provision of health care services in the U.S.. The article explores the medical world through the medical expenses incurred by a 64-year-old Janice S., Sean Recchi, A 42-year-old from Lancaster, Ohio and several other egregiously billed patients. The article poses the question: why exactly are the medical bills so high; in particular hospital bills?

US health care expenditures have been rising quickly over the past few years; it has risen more than the national financial system. Nonetheless a number of citizens in the US still lack appropriate health care. If the truth be told, health care expenditures are going to continue to increase; in addition numerous individuals will possibly have to make difficult choices pertaining to their health care. Our health system has grave problems that require reform, through reforming, there is optimism that there will be an increase in affordable health care and high-quality of care for America. Medicaid, Medicare and private sector insurances are all going through trials and tribulations because of

The healthcare system plays a key role in the economic stability of our country, as every year trillions are spent in attempt to combat disease and health issues that plaque humanity. As it makes up a significant amount of the expenditures in the economy, so the costs associated with health care of those in pain from illness and injury, including lost productivity, increased need of assistance in living and also the cost of death in some cases, is important to the economic stability and over all standard of living in our country. The key to economic prosperity is balancing the need for care with the costs of illness to keep as many people healthy and well without breaking the bank of collective society. The costs of healthcare have been increasingly problematic in recent years with so many issues surrounding the current system. With the “total health care spending in the United States expected to reach $4.8 trillion in 2021, up from $2.6 trillion in 2010 and $75 billion in 1970, meaning that health care spending will account for nearly 20 percent of gross domestic product (GDP), or one-fifth of the U.S. economy, by 2021” (Aetna). With this in mind it is apparent that as we look at the trillion-dollar industry of the medical community it seems that it needs to be a major focus of our nation as a whole and with the many issues come many creative solutions. First let us analyze the reasons behind the current cost and the major problems facing this industry and than discus what