Health Care Spending in America Essay

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.

I argue that advances in technology, nondiscretionary costs, and lack of competition in the medical equipment, pharmaceutical retail and insurance markets are the main reasons behind the high cost of health care. In this paper, I will use and analyze various resources like America’s Health Care Crisis: Who’s Responsible by Nancy Levitin, Health Care USA: Understanding its Organization and Delivery by Harry A. Sultz and Kristina M. Young, and Epidemic of Care by George J. Isham and George C. Halvorson to prove and support my argument, which is that advances in technology, nondiscretionary costs, and lack of competition in the medical equipment retail market, are the specific factors behind the rising cost of health care. I will also propose different strategies that will help achieve lowering the price of healthcare. Many people across the nation are unable to seek medical attention due to insufficient funds. If people do not receive health care, communicable diseases may spread more often on a large scale and life-threatening diseases may go undiagnosed leading to an increase in death rates. Making health care affordable can be achieved by making advanced technology less expensive, decreasing the amount of nondiscretionary costs, and increasing the competition in the medical equipment, pharmaceutical retail and insurance markets.

This paper utilizes five established sources to examine and analyze the effects unstable and constantly changing healthcare costs have on the American economy. These sources all express different components of healthcare spending that play a major role in the economy. By utilizing Federal Health insurance programs such as Medicare and Medicaid, these sources provide an inside look on ways in which these programs affect the economy. Cheeseman (2008) expands on how healthcare costs affect businesses and Johnson of The Associated Press describes how it affects the economy as a whole applying numerous factors such as components that make up the healthcare spending, how they hinder the progression of other aspects of economy by limiting government spending to healthcare, and their immediate effect on workers and businesses. Though healthcare is beneficial to some, Light (2016) reveals the darker effects it carries on the economy. Cohn (2014) provides a catalog of problems economists face when the facts concerning health care costs are concerned and outlines a series of statistics that display yearly growth rates in healthcare costs, and actual and projected growth in healthcare spending. Auerbach and Kellerman (2011) present findings on how increasing healthcare costs impacts the American family when available income and buying power is concerned while providing data and statistics to complement discoveries and build a solid case on how the bad outweighs the good. This

The intended audience for this argument is any individual who provides or receives health care in America. This paper can also be read and understood by anyone who is curious about the effects of health care costs on Americans.

In 2014, the U.S. health care spending increased 5.3% to $3.0 trillion, or $9,523 per person, a faster increase than the 2.9% in 2013. The spending increased due to extensive coverage expansions under the Affordable Care Act (ACA) (Centers for Medicare & Medicaid Services, 2014b). In 2014, Medicare spending grew 5.5% to $618.7 billion and represented 20% of the national health expenditure, a faster increase than the 3% growth in 2013. The spending increased due to prescription drugs, physician and clinical services, government administration, and insurance (Centers for Medicare & Medicaid Services, 2014b). In 2014, Medicaid spending grew 11% to $495.8 billion and represented 16% of the national health expenditures, a faster increase

Today, health care issues within the United States are still a major concern in regards to where people of our communities do not always agree with what is being done and what is not being done. The three major issues with health care spending is how much is it going to cost and where is the money going to come from? The amount of per-patient costs have doubled more in the United States than other nations around us. The last issue is the amount of Americans that has no health care at all. This paper will discuss the healthcare expenditures that is necessary for our entire population.

As a result of enacting the Affordable Care Act, insurance costs will increase because the government will offer universal healthcare. This requires an exorbitant amount of “new [medical] technology [which] will increase efficiency; the cost of new tests and treatments will outweigh the savings”, consuming millions of dollars (Whelan). Therefore the price of healthcare will increase in order to cover all these expenses needed to contribute to the nation’s overall health. Without the Affordable Care Act in effect, the current annual average expense of healthcare insurance is estimated to be around $5,600 per person, an increase compared to $4,255 in 2010 (Kaiser Family Foundation). After the recession that began in 2007, “the government expects that the growth of healthcare spending will outpace the expansion of the economy. By 2020, 1 of every 5 dollars spent in the U.S. is expected to go to healthcare” (Levey). This thus proves that as time passes the amount of healthcare is going to increase, but precise expenses cannot be predicted since it will be evident in the following years to come.

One of the biggest industries in the United States is healthcare industry, which accounts for over 17.5 percent of the Gross Domestic Product (GDP) of the country. This big representation of the nation’s economic activities impacts the overall economy. In other ways, it’s also impacted by the general economy. While the health care industry continues to grow, transformational changes also continue to enforce change in its organizational structure. Change in organizational structure enables health care providers to make arrangement for the change. In this case, the overall health care providers’ advance in new medical technology (to provide the best quality services), financial system, and the entire health care service structure, rules, and regulations are changed. Hence, a health care industry is fronting a noteworthy pressure to reduce health care cost, to prepare for an influential change in how health care is provided, financed and consumed while delivering the quality care (Hicks & Jacobs, 2014, pp. 385-402).

The United States (US) cost of health is higher than other countries. The population health status has improved but more work needs to be done. However, in 2007 the US spent $7,290 per capital on health care. In the early 1990’s health care spending was $714 billion by 2007 the spending was 2.2 trillion dollars (Berryman, Palmer, Kohl, & Parham, 2013).

Medical cost trend is the projected percentage increase in the cost to treat patients from one year to the next. After significant five-year shrinkage in healthcare spending growth comes to an end by next year as the economy grows stronger it releases a repressed demand for care and services. Despite some higher utilization and cost of new technologies, research for new cures of AIDS, hepatitis C, cancer, and multiple sclerosis, the rise in the expected growth rate in 2015-2016 is tolerable compared to the two-digit annual increases seen through the late 1990s and early 2000s. While the structure of the health care delivery system has undergone significant change over the last decade health care cost inflation slowed recently, primarily as

Most government financed systems are inclined to make available for every person living in the nation with treatment which proposes access to some fundamental level of care. Majority of people pay for coverage through taxes and additional charges. In government financed health care the government may provide care itself such as the United Kingdom or they may contact other providers to do so ex: Germany and Japan or in the United States

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

The cost of health care in the United States continues to rise. National healthcare expenditures totaled over $2.9 trillion in 2013, equating to $9,255 per capita (Centers for Disease Control and Prevention [CDC], 2015). This is a consequence of both private and government healthcare financing mechanisms including: high unit prices, market power, specialized medicine, medical malpractice, private health insurance costs, ill populations, not utilizing best practices, and a medical model versus population health focus (Kutter, 2008; Rice & Unruh, 2016; Sultz & Young, 2014).

In 1954, Congress passed legislation allowing employers to provide health insurance benefits to employees on a tax-free basis (Sih and Singh 99). This legal provision marked the beginning of the rapidly expanding health care costs still apparent today due to the major incentives provided by the government to obtain employer-based health coverage. The overwhelming popularity of employer-based health insurance has led to a serious market inefficiency resulting from the system of third-party payment. As individuals rely on their insurance companies to pay for their medical expenses, this provides

The healthcare industry has long been the most demanding field and largely impacts the economy. Whether this impact is negative or positive fluctuates. The government’s goal is to have healthcare positively impact the economy, which is why the Affordable Care Act was implemented. The Act states health insurance companies must offer coverage to all comers, and prohibitions must be set preventing insurance companies from charging higher prices to sicker people. Those opposed say the Act will be the downfall of healthcare and negatively impact the economy. However, this is not the case thanks to the stabilizing effect of subsidies and has had the opposite effect. The economy has improved thanks to the Act. As mentioned previously, healthcare is