Healthcare Spending
HCS/440

Healthcare Spending

United States healthcare spending exceeds healthcare spending in any other country in the world. These increasingly high figures of healthcare spending cost are influenced by several different reasons. An aging population, illegal immigration, and technology advancements are some of the few influences on rising healthcare costs in America. It is imperative that health care costs are managed and soon because the government is finding it quite difficult to sustain everyone’s needs. In addition, healthcare reforms must be made to lessen healthcare costs before the quality of healthcare reduce in a drastic way. Healthcare spending has been on a continuous incline in America throughout the years. According to Center for Medicaid and Medicare Services, in the year of 2008 health care cost rose to $2.3 trillion in the United States; this was 4.4% higher than 2007 costs. Healthcare costs are averaging a little over %16 of the entire Gross Domestic Product (GDP). In 2008 Medicare spending increased 8.6% and Medicaid spending increased 4.7% in the same year. In addition, hospital stays physician rates, clinical visits, and prescription medications increased as well. 31% of a $1.6 trillion healthcare cost has been designated strictly for hospital stay care. Clinical and physician services are accountable for about 22% however, proposals from physicians account for a much vaster percentage of health care costs. Prescription medications make up about 11%; which has continuously increased over the past 10 years. The remaining health care costs branch out from administrative, long-term care, and other miscellaneous expenses. United States health care system is said to be the most expensive health care systems in the world. This accomplishment is not what the nation anticipated this is why it is imperative that health care costs has to be controlled by reducing spending and implementing savings within the system. The United States consumes more health care and pays the highest rates for it than any other developed country. However, by implementing policies to the nation’s current health care system with direct focus which pertains to areas that would positively reduce health care costs significantly. Creating a policy that will manage poor behavior has the potential to save about $408 billion annually. In doing so, the new policy would potentially improve coordination of care management is estimated to save up to $111 billion a year.
In addition, there are incentives that will reduce the promotion of excess health care which in turn has the potential of saving about $151 billion per year. Decreasing fraud and reforming transactions has the potential to save the government about $200 billion a year. In addition, proper managing of medical prices which is continuously on the rise due to the various competitions would also save about $148 billion a year. These few changes can impact the health care system tremendously by saving $1 trillion each year. These potential savings is so important and beneficial to the outcome of the U.S. health care spending.
Currently the public’s health care needs are being financially covered dependent upon the finances of each individual patient. There are local, state, and federal programs that pay up to 45% of the entire United States expenses on health care. In more private areas, insurances and personal spending accounts pay up to 40%. The remaining percentages of 15% are due to consumer out-of pocket spending. The truth of the matter is Americans who continue go without health care coverage and remain financially unable to cover costs for care services are increasing. These particular groups of individuals have burden health care services, providers, tax payers, and other consumers. Unfortunately, these entities are left paying the costs for those individuals who choose not or can’t afford to pay themselves.
The United States health care system economic goal is to ensure all Americans have affordable and accessible health care services. An aging population will add to health care expenses due to more illnesses and medical services which will add to increased health care expenses within the system. In addition, unhealthy lifestyles are another related influence of economic needs of the nation. For example, mismanaging diabetes and drug abuse influences the health care costs in our country.
Health care standards in America must be improved in order to ensure future healthcare in the future. The aging population will only increase as the years continue; this is why it is imperative that our health care system is prepared. There are concerns that there may not be enough health care providers needed for future to provide the necessary care. The supply must be able to meet the demand in health care. Currently there are many health care workers that will be on the verge of retiring and new workers will be needed to replace these workers. In order to properly staff workers, individuals must be recruited for careers in specific areas of the medical industry. Every medical personnel plays a critical role in the deliverance of quality health care.
However, it is the responsibility of every citizen to take the initiative in improving their lifestyle choices. Health care professionals have progressively focused efforts in managing health care demands for individuals via health and wellness programs. These programs are designed to provide motivation for a healthier way of living. These programs present the necessary tools to assist individuals make better choices in their healthcare. Healthy living programs that include smoking cession courses, healthy eating, and proper exercise at affordable prices are available within and enforced by many companies.
I believe that the U.S. healthcare system should be financed by the consumers of our nation. According to Montgomery, K. (2009), consumer driven health care is a type of health care financing utilized to decrease the amount of health care spending. This financing option is expected to create financial incentives for consumers in choosing the best value in health care. Health savings accounts are examples of consumer driven health care systems. Health savings accounts usually has increased deductibles and decreased monthly premiums. In addition, this option gives consumers the opportunity to have more say so and control in their own health care spending. The high expenses associated with deductibles and out-of-pocket costs have greatly impacted the way patients evaluate their health care costs. In recent research Medicare has been estimated to cover about 40 million seniors and disabled Americans. 50 million Americans that meet each individual states criteria will be covered by Medicaid. However, these services can only be provided based on perspectives driven by consumers. Medicare is structured so that the quality of treatment options directly reflects premium costs. The way that Medicare is designed, healthcare providers are unable to apply the most expensive services and medication for patients. On the other hand Medicaid has the ability to create co-pays and deductibles based on family income. When consumers are responsible for some portion of financial responsibility, they tend to be more conscious in decision healthcare decision making. The U.S. healthcare system would greatly benefit from a consumer driven healthcare.
In conclusion, it would be in the best interest of the U.S. healthcare system to reform. The health care demand is on a continuous rise due to the uninsured amongst other things. If this continues this nation will lose the ability to provide care for individuals in the future. In addition, the government needs to take charge and establish infrastructure model for the nation’s healthcare system.
Ultimately, consumers must embrace the responsibility and make wiser healthcare decisions. Aging is something that cannot be controlled however; early prevention reduces many healthcare risks. Through education and healthy living styles will reduce healthcare spending in our country.

Reference
Center for Medicare and Medicaid Services. (2010). NHE Fact Sheet. Retrieved November 5, 2012, from http://www.cms.gov
Montgomery, K. (2009). Consumer-Directed Healthcare. Retrieved November 6, 2012, from http://www.about.com
Justice.gov. (2010). Executive Summary. Retrieved November 5, 2012, from http://www.justice.gov