World Health Case Study

Decent Essays

In 2014, the top ten pharmaceutical companies in the world had a total revenue of $429.4 billion dollars. One common misconception is most profits the pharmaceutical companies collect, goes back into research and development (R&D) of new medications. Yet, in that same time period only $65.8 billion dollars of the total $429.4 billion went toward R&D. Their combined profits for 2014 were $99.8 billion dollars with an average profit margin of 19.6%, Pfizer is the highest being at an amazing 43% (BBC News, 2014). Seeing all of these facts and figures collectively, shows it is clear the US is spending too much on healthcare. An important question is, why and what can we do to decrease our spending?
First, we need to change the culture of …show more content…

Legal cases against healthcare workers has become big business in today’s world. This is not to say that caregivers should not be held momentarily accountable for their actions, but there are far too many claims from both patients and attorneys looking to collect money from unnecessary lawsuits. In 2010, there were $30 billion dollars in spending in malpractice awards, lawyers’ fees, and lawsuit-related administrative costs (Agresti, 2016). The side effect of all these lawsuits has created what is known as “defensive medicine” practiced by doctors. “Defensive medicine” is defined by the American Academy of Orthopaedic Surgeons as, “the practice of ordering excessive or unnecessary tests, procedures, visits, or consultations solely for reducing liability risk to the physician, and/or avoidance behavior, the practice of avoiding high-risk patients or procedures.” (Agresti, 2016). With physicians continually ordering unnecessary tests and procedures as an attempt to protect themselves from law suits, the patient, or their insurance carriers, end up paying excessive amounts. As third party payers intensify their scrutiny on unnecessary testing, either the patient or the hospital winds up absorbing the surplus charges. This loss is passed along to the consumers in the form of higher healthcare costs which in turn causes an increase in healthcare spending. The more defensive medicine in practiced, the more

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