Health Care Spending in the United States

1163 Words Mar 26th, 2012 5 Pages
Health Care Spending in the United States
HCS440/Economics: The Financing of Health Care
November 25, 2011
Jeannie Major

Health Care Spending
In the early 1930’s, the Blue Cross/Blue Shield Organization led consumers to hospitalization and medical coverage under their own charter for everyone who sought coverage for one prepaid fee. Years later, other insurance companies, such as Kaiser Permanente began to offer coverage to consumers within their geographic boundary. However, health care spending is on the rise. Over the last couple of decades the expenditures have risen from 724.0 billion dollars in 1990 to 2,486.3 billion in 2009(US census, 2011). Today, we are a nation with Health Care Reform signed into law by President Obama
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Likewise, there will be an increase in waiver forms as employees will have the opportunity to “waive” their right to partake in healthcare benefits from the employer. Medical claims activity will rise due to an increased number of consumers covered with no pre-existing condition exclusion for those who are age 19 and younger. When services are provided for consumers beyond the age 19 for a pre-existing condition, there could be an increase in consumer appeals to the health carrier.
There are two additional attractions to the healthcare reform. One is the anticipated reduction of cost to consumers by eliminating annual or lifetime maximums for services. This reform will not affect ancillary plans such as dental, vision, hearing and prescription drug plans for adult coverage.
The other attraction is that there will always be consumer coverage. An employer would provide a temporary insurance plan to bridge the gap for retired employees who are over the age of 55, without retiree medical coverage and not Medicare eligible. Employers would receive 80 percent of claims that are between $15,000 to $90,000 to help reduce plan costs (AARP, 2010). The catch for the employer is to apply, document claims, and implement the program that

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