...Members FROM: DATE: SUBJECT: Rising Health Care Cost Health care in America is in crisis. Health care costs are skyrocketing. This problem is not new, nor is the recognition of it. The size, complexity, and political clout of the health care industry political distrust, particularly among people who are currently well insured and geographic diversity in spending, coverage, and delivery systems have frustrated past reforms. Furthermore, health reform means income redistribution among payers and across service providers. Health insurance premiums have doubled in the last 8 years, rising 3.7 times faster than wages in the past 8 years, and increasing co pays and deductibles threaten access to care.i_ The medical expenditure rate is now increasing more rapidly than ever, and control of medical costs has reemerged as a major national imperative. Failure to solve this problem has resulted in most of the other critical defects in the health care system. Least investment in primary prevention and public health: America faces epidemics of obesity and chronic diseases as well as new threats like bioterrorism. Yet despite all of this less than 4 cents of every health care dollar is spent on prevention and public health._iii Many Americans are uninsured because of rising insurance costs: Over 45 million Americans lack health insurance.iv_ Even those with health insurance are struggling to cope with soaring medical costs. Increased healthcare costs are making it difficult for small scale...
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...Health Cost The Recession that ended in 2009 caused the National Health spending to see an increase in low rates. With the Affordable Care Act taking effect in 2014 there are concerns that the slowdowns from the economic factors and change in the health system will affect the health cost The recession of 2007-2009 has the Nation focus on the slowdown in health spending because of structural change that could lead to measured growth in the future. We can assume health spending development to bounce back up in the future as the economy recovers. An example of operational changes is when health spending is growing more slowly than what would be anticipated. We would see a persistence of traditionally low rates of growth even as the economy returns to full employment. (Kaiser 2013) Employee sponsored insurance, Medicare, and Medicaid programs all effects the health spending growth. In 2014 the national cost for subsides provided to low and middle income people buying coverage through new health insurance exchanges. The national budget developments future increase in health spending based on Medicaid and Medicare generally low rates of growth of health spending in recent years. Most importantly if we believe health spending growth will remain low, we may be content by letting current cost containment strategies play out. According to (Kaiser 2013) the last four health spending progress has been at its lowest levels in five decades. There has been discussion on how the slowdown...
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...From 1965 to the present, health care costs continue to rise despite multiple strategies in efforts of controlling the costs. Increasing costs are caused by the minimal control of federal and state government, advancing medical technology, expensive medical specialists, and complex administrative system of insurers and providers (Mason, 2016). Health care costs are increasing significantly due to those with chronic illnesses as they have contributed 50% of the healthcare expenses in the United States from 1977 to 2007 (Mason, 2016). These costs are expected to rise as the population ages and whether chronic illness diagnoses continue to increase (Mason, 2016). Health care quality is contingent on desired patient outcomes (Mason, 2016). Studies...
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...CONTROLLING HEALTH CARE COSTS WHILE PROMOTING THE BEST POSSIBLE HEALTH OUTCOMES American College of Physicians A White Paper 2009 Controlling Health Care Costs While Promoting the Best Possible Health Outcomes Summary of Position Paper Approved by the ACP Board of Regents, September 2009 What are the Major Drivers of Health Care Costs? Major drivers of health care costs include: inappropriate utilization especially of advanced medical technology, lack of patient involvement in decision-making, payment system distortions that encourage over-use, high prices for health care services, a health care workforce that is not aligned with national needs, excessive administrative costs, medical liability and defensive medicine, more Americans with declining health status and chronic disease, and demographic changes including an increase in elderly persons. This paper addresses each of these drivers of health care costs and provides recommendations for controlling them. Why Do We Need to Control Health Care Costs? Improvements in health care have the ability to provide opportunities for all people to live better, healthier lives. However, the rate of increase in U.S. spending on health care continues to exceed economic growth at an unsustainable pace. The rate of growth in health care spending is the single most important factor undermining the nation’s long-term fiscal condition. Why Should Controlling Health Care Costs be Linked to Promoting Good Health Outcomes? Increasing pressure...
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...Courtney Sheegog May. 8th, 2013 Hca/210 Rising Health Care Cost Assignment • What are some of the driving forces behind rising health care spending? One of the driving forces behind rising health care spending is Technology and Prescription drugs, chronic disease, aging of the population, Administrative costs. For several years, spending on new medical technology and prescription drugs has been the leading contributor to the increase in overall health spending. (Healthcare reform .Gov. ,2011). Longer life spans, and greater prevalence of chronic illnesses. This has placed tremendous demands on the health care system, particularly an increased need for treatment of ongoing illnesses and long-term care services such as nursing homes; it is estimated that health care costs for chronic disease treatment account for over 75% of national health expenditures (Kaiser Edu.org, 2010). How do HMOs affect health care costs? HMO's often emphasize their ability to contain costs through oversight of physicians' decisions or by implementation of a capped payment scheme that aligns physicians' incentives with those of the healthcare plan. HMO's do have lower hospitalization rates and shorter hospital stays and use fewer expensive tests and procedures than traditional health-care providers. Some people also argue that the increasing use of managed care generates positive externalities that benefit consumers enrolled in non-HMO health plans. This argument typically invokes some notion of market...
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...Problem Rising health care costs is a major concern for many nations, societies, and individuals. However, health care costs are far higher in the United States than any other developed country. Over the past 3 decades, health care spending in the United States have increased ten times, from $236 billion in 1980 to an estimated $2.4 trillion in 2010 (Kim, Tanner, Foster, & Kim, 2014) . More than one-sixth of the United States economy is spent on health care. Health care costs have been rising continuously faster than the overall economy and personal incomes for decades. Even though the U.S spends more on health care than any other country in the world, it is still ranked the lowest amongst the developed countries around the world. The goal...
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...While health spending has been growing, it is growing at a stunted rate. The Office of the Actuary (OACT) in the Centers for Medicare and Medicaid Services reports that national health spending grew by 3.9% each year from 2009 to 2011, the lowest rate of growth since the federal government began keeping such statistics in 1960 (The Kaiser Initiative on Health Reform and Private, 2013). By 2012 spending increased only another .4% to 4.3% increase. The question(s) remain: what are the causes in this resulted stunt in growth? Several factors explain, though do not completely quantify the reasons: 1. Economic Downturn and Inflation – consumers spend less on health care as their income lags and individuals cut back on services and goods. 2. Growth in Gross Domestic Product (GDP) – recession periods lead to organizations providing less health care benefits; fewer people employed and insured. Despite the fact that the aforementioned variables explain over 85% of the disparity in health spending growth rates from 1965 through 2011 (The Kaiser Initiative on Health Reform and Private) the effects are still cumulated in a “lagged” response, meaning that the changes are slow to develop. Explanations are provided to better ascertain the reasons behind these lagged responses that include: * Most people are insured, and insurance has an economically protective effect in shielding people from the full cost of health care. * Consumers may perceive health care as a necessity...
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...The debate about health care involves issues concerning the right to have healthcare insurance as well as those 65 and older, obesity epidemic, smoking and how each of these topics affects health care in the United States. The number of people with health insurance has steadily increased among with the elderly, who face additional challenges when it comes to seeking health care. The projected increase of Americans classified as obese or who smoke has also had an impact on our health care system. The rising cost of health care and health insurance will have a great impact on the future of the economy. Today’s health care system is increasingly complex regarding cost-controlling measures and the affordability of insurance premiums. The...
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...B. Johnson Southern New Hampshire University Discrimination Against the Obese in the Workplace In the United States, there has been a substantial increase in obesity. According to the Centers for Disease Control and Prevention, one in every American adult is now considered obese. Obese is defined as having a body mass index (BMI) of 30 or higher. Obesity can contribute to diabetes, heart disease, stroke or certain kinds of cancer. What effect does obesity have in the workplace and how can we fight it? What is the Correlation between Obesity and Health Care Costs The CDC and the National Institute of Health (NIH) indicate that obesity contributes to heart disease, stroke, diabetes, and some types of cancer, all of which are leading causes of preventable death. In 2008, medical costs associated with obesity were over $147 million. 6 to 10% of U.S. health care spending is contributed to obesity. The health costs are 30% higher than normal weight persons. Is Obesity a Protected Class When the Americans with Disabilities Act was first passed, the EEOC viewed severe or morbid obesity as impairment under the Act, but not general obesity itself. But, this has changed under the Americans with Disabilities Act Amendments Act. In 2013, the American Medical Association classified obesity as a medical disease. While this classification does not affect the ADA, it could be perceived that obesity is a protected class. How should obesity be addressed in the workplace...
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...Rising Cost of Health Care: Effects on Access to Care The rising cost of health care is a trend that is negatively influencing access to health care. According to our course textbook, Policy and Politics in Nursing and Health Care, over 46 million Americans did not have health coverage in 2008, and 25 million American adults were underinsured (p. 124-125). For most people, this can be attributed to the high cost of premiums, co-pays, and deductibles. The purpose of this paper is to discuss the history of the trend of rising health care costs, the influence rising costs have on the delivery of health care, how rising costs create disparities in health care, and two ways that nurses can address inadequate access to health care. Access Trend In the U.S., there are more people today than ever before, unable to access quality health care. “Access is the ability to obtain needed, affordable, convenient, acceptable, and effective health care in a timely fashion” (Mason, Leavitt, & Chaffee, 2012, p. 124). This lack of access is attributable to the high cost of health care, which makes it unaffordable for the working poor, and those working for small businesses, to pay for adequate health care. There is an inverse relationship between the cost of health care and good patient outcomes. It is estimated that $7,000 per person, including children, is spent on health care in the U.S., yet the country does not rank in the top 15 of industrialized countries in terms of good health outcomes...
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...THE COST AND SPENDING OF HEALTH CARE: Why Universal Health Care 06/18/2012 THE COST AND SPENDING OF HEALTH CARE: Why Universal Health Care Health care cost and spending is a major concern for our society. Many governments around the world have established universal health care, which takes the burden of health care expenses off of private businesses or individuals through pooling of financial risk. There are a variety of arguments for universal health care and related health policies. Health care is an important part of health systems and therefore it often accounts for one of the largest areas of spending for both governments and individuals all over the world. For example, medical debt is now a leading cause of personal bankruptcy in the United States. A policy should be created to help lower the cost of health care. One way that would help improve health care spending is to create a universal health care to make sure everyone is covered. By creating a universal health care, it will help decrease the number of lobbyers which in turn will cut government funding to those special interest groups. There are 45 million Americans uninsured and according to CNN report 45,000 Americans die each year due to lack of affordable health care. So by creating a universal health care, we can be sure to expect to see a longer lifespan for our population as is the case in countries that have a universal health care. Since this type of health care would be regulated...
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...Physicians affect the cost of healthcare for insurance thru the administrative costs and doctor’s malpractice liability insurance that will protect them from unwanted legal issues. American Physician pays nearly $83000 per year, which is the major chunk of administrative cost. That's the cost of the time and labor it takes for physicians' employees to correspond with various insurance plans about claims, coverage and billing for patient care and prescription drugs. Researchers surveyed physicians in Ontario, who said health insurance paperwork costs them an average of $22,205 a year. If American physicians had administrative costs that matched those of the Ontario doctors, physicians could save as much as $27.6 billion a year. A major problem with American health care today is what policy experts call "perverse incentives." As shown in the figure above, hospital care and physician/clinical services combined account for half (51%) of the nation’s health expenditures. Doctors and hospitals bill insurers for every individual service — every office visit, MRI or hour of operating-room time — a "fee for service" model that drives health-care inflation by rewarding providers who order potentially unnecessary tests, perform potentially unnecessary surgeries and even make mistakes. A hospital readmission caused by avoidable complications just means more billable expenses. Doctors are quick to say that much of the 30% of excess health-care spending is on "defensive medicine" — providing...
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...Cost shifting when hospitals or healthcare provider’s charges insured patients more than the uninsured for the same services. Hospitals and health care providers used this mechanism to make up for the loss make by providing services to uninsured. Likewise uncompensated care is when hospitals or health care provider’s loss money for charity care and or due to the fact that patients who get treatment are unable or unwilling to pay for the healthcare services the received. (Shi, Singh pg238). Hospitals cost shifting are becoming more of trend for example hospitals attract both patients and physicians with more expensive technologies and treatments. According Christopher W. Baugh and Jeremiah D. Schuur (2013) when observation is used as a billing status in inpatient areas without changes in care delivery, it’s largely a cost-shifting exercise — relieving the hospital of the risk of adverse action by the RAC but increasing the patient’s financial burden.(p303)...
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...HC1: The rising cost of healthcare is one of the greatest challenges facing the United States that will continue in the coming generations. Reducing the cost and improving the quality should be a top national priority, but despite the many attempts to reshape healthcare market place and improve delivery in the past years, current trends have proved otherwise. There is no doubt that America has benefited from the Affordable Care Act, which reduced health care spending and insured more than 90 percent of the population, but unfortunately, this slowdown has ended and healthcare spending has recently risen above inflation and wage growth (Rother, 2016). Recent statistics has shown that the U.S spent $1.3 million to 2.5 million between 1999 and 2009 o healthcare (Auerbach, 2011). HC2: The continuous increase in healthcare cost affects the...
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...The Driving Forces behind Rising Health Care Costs Leslie Parvin HCA/210 August 23, 2013 Jon Lasell The Driving Forces behind Rising Health Care Costs Even though some experts disagree the high cost of health care is not a serious problem, the high and rising costs are a major issue, because of the high cost of new technologies and the aging population. Furthermore, the most expensive health care system in the world is right here in the United States, with the per capita health expenditures far above those in any other countries. However, to help the sky rocketing costs of health care, insurance companies came out with plans like HMO’s to help manage care organizations that provide comprehensive health care services for a predetermined annual fee per each person enrolled. The rising health care costs have become a huge concern for almost everyone, including the general public, federal and state governments, and employers who purchase health care for their employees. Hence, there are several reasons to explain the high and rising costs of health care. According to Bodenheimer (2005), he stated, “High health care costs might derive from factors outside the health sector rather than from characteristics of the health care system itself” (p. 849). One of these factors outside the health sector is the rising costs of health care for the aging population. According to the Pew Research Center (2010), as of January 1, 2011 approximately 10,000 Baby Boomers,...
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