The Cost Of Health Care

It is no secret that the cost of American healthcare is becoming increasingly more expensive. However, the issue of the rising cost of healthcare and its severity needs to be recognized as a major problem. Health prices are steadily increasing in the United States, and there is no sign of it stopping. Since 1970, spending on American health care has grown 9.8%, which is a rate that is growing faster than the economy (“New Technology”.) Furthermore, health insurance premiums are also increasing at a rate five times faster than American salaries, which makes it difficult for families to afford health care coverage (Zuckerman 28). Therefore, it has become an obligation to address why the cost of American health care is soaring and to seek out a solution to lower the cost. Many would jump to the conclusion that the United States simply charges too much for their medical services, but there are deeper influences that need to be analyzed. The causes of the rising cost of health care are people not using preventive health care, the development of modern technology, and the treatments being overprescribed. A possible solution is to have preventive health care services available in clinics of low-income areas.

Moreover, we see that some providers are focusing on what providers do and how they get reimbursed rather than what the patient needs, which is a focus that does not prioritize quality of care and therefore does not align with the Triple Aim framework. The problem presented regarding this matter is that the health care system lacks a patient-focused care of medical conditions that puts patients and their health needs first. For example, when we think of provider reimbursement, it is not in the patient’s best interest for the system to only have a simple fee-for-service structure. A structure like this one will only lead to an increase of health care expenses. Also, it fails to incentivize high-value service, which also does not align with the Triple Aim framework health care providers should go by. It is very crucial for the health care system in the United Stated to find a better balance between medical groups reimbursement and patients needs in order to reduce the risk of overutilization.

The health care system is one of the largest industries in the nation. It employs nearly twelve and a half million people. Even though this many people are employed by health care systems, there is little to no competition between the many different systems. This results in the cost being whatever the system wants. People who are ill or

One area that has contributed to the rise of healthcare costs are the varieties of healthcare services offered to the patient. Competition between providers has caused physicians and hospitals to offer the most current healthcare technologies and modern, eye-catching settings in order to attract and retain clients (Shi & Singh, 2015). Reimbursements for costly procedures and hospital services have been compensated at a higher rate which has also supported the expansion of hospital and specialty procedure settings (Schroeder & Frist, 2013). Renovations of the physical settings and the acquisition of expensive technologies have elevated healthcare services prices to encompass the additional costs of providing high technical services and attracting clients and cause the over-utilization of expensive treatments.

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.

While there has been large media coverage about the insurance impacts of the Affordable Care Act (ACA), there has been a smaller amount discussed of the law’s changes to provider reimbursement policy, reforms to the delivery system, and investments in programs to improve the quality of care and constrain long-run growth in health care costs. And yet, the elements included in the ACA directed at cost and quality is possible to affect the practice of care for nearly every provider across the country. Although cost containment policies and initiatives are largely applied through federal health programs which including Medicare and Medicaid; cost containment in these programs has important cost-saving spillover effects to private health care markets through changes in health care practices and pricing across sectors of care.

The cost of health explains almost half of the budgets of the state from financing the Medicaid program to providing health care for the employees of the state and other less qualified population like the prisoners (Vanderbeaux, 2014). In America, thousands upon thousands of decisions concerning health care are made by State legislatures every year (Vanderbeaux, 2014). Some of those decisions involve how best to provide appropriate care more efficiently, and deciding on what age group of patients needs to be immunized (Vanderbeaux, 2014).

There are many factors that currently impact the increasing cost of health care. According to the Ginsburg et al. (2012), the United States spent approximately $2.6 trillion dollars on health care in 2010, a number which is 9-11% greater than other nations such as the United Kingdom, Germany, and Japan. Factors that impact the increasing cost include aging populations, rise of chronic disease, improper lifestyle factors, advances in technology, and burdens on providers and patients (Ginsburg et al., 2012).

In the past, health care costs has been between 1% and 2.25%, greater than the potential gross domestic product (GDP) (Congressional budget office, 2013).

The US prides to be one of the largest economies in the world. Even in terms of health expenditure, it has the highest healthcare expenditure. However, the US lies among the most developed nations that do not provide healthcare for all people. It is known that healthy people cause less costs to the economy when compared to sick people. The issue of the healthcare costs is one of the significant challenges that are facing the US healthcare system. However, there are a lot of efforts that are being made, in a bid to cut the costs of healthcare in the US system.

The cost of medical treatment has increased dramatically, placing more focus on the significance of the doctor’s actions about what treatment suits the patient the best. Hall and Schneider ( 2008) found that the medical field is highly impacted by money. It is impacted by money creating a place where uninsured patients pay one third to one half more than patients who are insured. They still express that having access to health care is important by stating that, “ Still, professional ethics should encourage physicians to five patients in economic trouble at least the benefit of the lowest rate they accept from an established payer” (p.1257) Having access to basic health allows patients to be wise about their options in medicine. Hall and Schneider explain “Since the early 1990s, hospital list prices have risen almost 3 times more than their cost, and their markups over cost have more than doubled from 74% to 164%” (p.1259). The increases in prices may stop a patient from receiving a treatment for an illness. For the patients who ultimately do have to get the treatment it is extremely important to get a treatment that has the

Charlie Norwood who was an American Politician and proclaimed Republican once stated that, "There is no question that managed care is managed cost, and the idea is that you can save a lot of money and make health care costs less if you ration it". Managed care and Health care insurance are terms that are used interchangeably today, and the main idea behind the formation of this component in the incredibly dynamic industry was to re-orchestrate how health services were organized to primarily deflate costs, preserve quality of care and provide means for management of care delivered to patients (Kongstvedt, 2013). Statistically, healthcare costs are on a steady rise and experts don't believe a change will happen anytime soon, but why is this? (Phoon, Corder, & Barter, 1996) Well, with the ever-evolving economy, the reasons for spikes in health care costs also yield new trends. Where it once was a result of over-utilization of health care, nowadays, we are seeing multiple factors attributing to the inflation such as: advanced technology, fluctuation in population demographics, and consumer demands (Kongstvedt, 2013). With these ever-changing and progressive rationales, comes aggressive reforms all in search of the quintessential model that meets the needs of patients, providers and insurers.

The existing costing methodology focuses only on the cost of units like departments or particular process affecting the quality of service and making the service expensive (Oklu et al, 2015). Furthermore without right understanding and recognition of cost incurred for the service it remains Herculean’s task to constrain healthcare spending. To change this dismal scenario we do not require medical science or an astronomical discovery, all we need is an efficient costing technique (Kaplan and Porter, 2011). The accurate costing system would account for the total costs for the resources utilised by the patient and not at department level.

The cost of healthcare and healthcare spending is a key component of any developed economy in that with good facilities there is a good source of human resource. Considerate health spending leads to the development of medical technologies and drugs hence satisfying fundamental social and individual demands for services that brings greater productivity, improved health, and longer lives. As compared to other sectors of the economy in the USA, health care is publicly funded. According to Organization of Economic Cooperation and Development (OECD) public spending in the United States of America accounted for almost half of total spending in the year 2011 as compared to 60-80 percent in other developed countries. The American society is currently grappling with exorbitant health care charges that have plagued the public; the high cost of health care services has been an issue that the ruling class has been grappling with. It has taken both political and social dimensions especially with the agitation of the Obamacare health plan when Senator Obama came into power. The focus of this discourse, though, is not to get into the political and social vagaries of the healthcare system, but rather to focus on the salient issues related to affordable care act (ACA) the American republic.

The cost of healthcare has been on the rise in recent times and is worrying to every stakeholder in the healthcare industry including the patients. Some of the reasons historically includes a high rate of inflation which has resulted in high prices of medicine such as in the recession period and also new drugs and technologies that require greater expertise and expenses. The role played by regulation authorities and competition within the healthcare systems has led to costly improvements which also have a direct impact on the cost of health care. Lastly, through managed care, health services regarding the cost have played a huge role in reducing medical costs for an extended period of time. However, with the increase of many patients through