...Health Care Spending James Brewer HCS/440 April 11, 2011 Health Care Spending In many countries as well as the United States, health care spending is at an all-time high. Within health care, there are several factors, which have contributed over the years to increase higher cost. As spending throughout many countries is a key factor. The United States is above average, resulting in many citizens who are unable to afford the high cost of health care. Although it is difficult to determine the exact cause of why the increase of health care spending has risen, there are a few health care situations to blame. These causes could be health care prices, new and different disease patterns, and consolidation of many corporations, legal systems, new providers, advanced technology, and the aging population. Another cause of rising health care costs is cost sharing. This cause will not diminish anytime soon in the United States. Many people believe that disease management, consumer choice for health care and even evidence-based practice could help solve the problem of spending. These solutions however may not be sufficed to drive health care costs down. ...
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...Love-Hate Relationship between the U.S. Healthcare Industry and the U.S. Economy The healthcare industry plays an important part in the economy of the United States. The sustained increase and high level of spending on health care has been the subject of discussion and scrutiny for several decades. The enactment of the Patient Protection and Affordable Care Act of 2010 (ACA) was hardly the first fiscal policy for healthcare in the history of the economy. There is a long list of fiscal policy attempts from predecessors such as Franklin Roosevelt, Harry Truman, Richard Nixon and most recently Bill Clinton (Sparer, p462). In 1933, Franklin D. Roosevelt drafted amended provisions to his pending Social Security legislation to include publicly funded health care programs but ultimately removed the provisions due to opposition by the American Medical Association (Coombs, p5). Following the Second World War, President Harry Truman called for universal health care as a part of his Fair Deal in 1949 but strong opposition stopped that part of the Fair Deal (Peon, p161-168). On July 30, 1965 President Lyndon B. Johnson signed into law the legislation establishing the Medicare and Medicaid program, social insurance programs administered by the United Stated government providing health insurance coverage to people who are either 65 or meet other special criteria for need (Roemer, p845). In October 1972, President Richard Nixon signed the Social Security Administration Amendments of 1972...
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...Theme: Health expenditure by Government in India Title: Health care and expenditure: an analysis of Indian Government’s Welfarism Name: Prakhil Mishra Semester : IV Roll no.: 13BAL027 Table of contents Sr.No. | Content | Page number | 1 | Abstract | 03 | 2 | Introduction | 04 | 3 | Why health expenditure is important | 04 | 4 | Trends in public spending | 05 | 5 | Core areas of spending | 10 | 6 | Conclusion and critical comments | 11 | 7 | Learning outcomes | 12 | 8 | Bibliography | 12 | Abstract Healthcare is a prime indicator of the development in a country. It is the basic function of a state to look after the needs of its citizens pertaining to health and nutrition. In India, there are high numbers of malnourished and undernourished people, and most of them are children under the age of fourteen. Health expenditure in India is a holistic approach of the government as a welfare state to ensure proper distribution at highly subsidized rates for the resource less people. The paper deliberates upon the government spending on health (Where it spends and how much it spends) and tracing of the changing trends in entailment of expenditure. Key matter of contention includes: * Introduction to public spending on health * Why spending on health is important * Changing trends in public spending on health and family welfare * Core areas where spending is done: analysis with the help of laws * Conclusion and critical analysis Key words: health expenditure...
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...examining the determinants of health care expenditures, thereby offering suggestions regarding what variables can be influenced to reduce the health care expenditures. One Canadian researcher, Livio Di Matteo, did many studies on the determinants of Canadian health care expenditures. In Livio Di Matteo and Rosanna Di Matteo (1998), they used a pooled time-series cross-section model and provincial data over the period 1965-1991 to examine the determinants of real per capita provincial government health expenditure, finding that the real per capita provincial government health expenditures were positively and significantly affected by real provincial per capita income, the...
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...The Role of Technology in Rising Health Care Costs. What should or shouldn’t be done. Neha Para, MPH Student 5453-001 US Health Care System University of Oklahoma Health Sciences Center December 8, 2010 Abstract Health care costs are a longstanding concern to policymakers. For years, health care spending has been rising faster than the rate of economic growth, raising the question of what factors are responsible for rising health care costs. This paper explores published articles that report results from research conducted on technological innovations in health care and its relation to rising health care costs. The cost increases have a significant effect on households, businesses, and government programs. Health care experts indicates the development and diffusion of medical technology as primary factors in explaining the persistent difference between health spending and overall economic growth, with some arguing that new medical technology may account for about one-half or more of real long-term spending growth. Rising health care expenditures lead to the question of whether we are getting value for the money we spend. On an average, increases in medical spending as a result of advances in medical care have provided reasonable value. An alternative viewpoint holds that although new technologies represent medical advances, they are prone to overuse and thereby excess cost. Most of the suggestions to slow the growth in new medical technology in the U.S. focus on...
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...Analysis of Contemporary Health Care Issue Katy Sforza Grand Canyon University: HCA - 530 2-5-13 Analysis of Contemporary Health Care Issue National health care expenses in the United States have been on the rise more rapidly than the national financial system for countless years, however several United States citizens are still lacking adequate health care. Sadly, health care spending is only going to rise and many people in the United States may have to make complicated decisions involving health care and additional responsibilities in their everyday lives if we do not start to reform. By reforming, it is hoped that America will see an increase to high-quality, affordable health care for all. Not only are private sector insurances enduring challenges due to health care spending, but Medicaid and Medicare are also. The Health Care Reform Act is hoping to drive down the cost or at least maintain the cost of health care spending. The reform is hoping to offer a delivery system that works better for clinicians and provider organizations by reducing their administrative burdens and helping them collaborate to improve care. The achievement of this reform will hopefully lead to assessable development in outcomes of care, and in the general health of the American people. Profit/Non-profit Although the provision of health services is dominated by not-for-profit organizations, there are many for-profit organizations as well that are affected by health care spending...
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...Date: | April 25th, 2012 | Subject: | Health Care Spending Growth and Reform | SUMMARY The following memo seeks to highlight the past and current problems facing federal health care expenditures within the U.S. It tries to answer the question if health care spending is now on more sustainable path along with giving projections for its current outlook. More specifically it addresses “supply-side” reforms, “demand-side” reforms and “voucher” reforms within the Medicare program, analyzing the benefits and downsides of each and what underlying problems these approaches contain. The memo summarises with recommendations as to which reform should be put in practice to achieve the desired results within the health care market. PROBLEM ANALYSIS 1. Health care expenditures are on an unsustainable path Reasons: * Aging of the population * Increase in health care costs due to excessive coverage * New medical technologies Under current law, spending for mandatory health care programs would increase from 5.6% of GDP today to about 9% of GDP in 2035. Total health care spending grew by 3.9% in 2010 and reached $2.6 trillion, or $8,402 per person. This is mainly caused by an aging of the population, an increase in retirement of the “baby boomer” generation, a rise in health care costs and a rapid innovation of medical technologies. All these factors lead to an increase in the federal budget deficit. Although recently health expenditure growth has slowed, the decline...
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...Analysis of the Macroeconomic Environment within the Health-Care and Automobile Industries Abstract This report discusses macroeconomic factors that impact both the automotive and health-care industries. Interest rates, consumer price index (CPI), consumer confidence, Gross Domestic Product (GDP), wage rates, and inventory levels impact the macroeconomic environment to influence these industries in the short run. Consumption as a percentage of the GDP depicted in table 1 indicates a continuous declined in consumer spending from 2005 through 2010 and suggests that consumers are becoming more conservative with disposable income spent on elective health-care products and procedures as-well-as new vehicle purchases. As the nominal interest rates indicate in table 2, the FED attempted to encourage consumer spending by decreasing the interest rates to encourage expansionistic economic activity, which would also be a positive influencing factor for both the health-care and automotive industries. The automobile industry is volatile by nature and heavily influence by macroeconomic factors, while the health-care industry enjoys an inelastic environment. Macroeconomic factors influence the health-care industry, it is unlikely essential health-care demand will decrease in the short term; however, elective health-care products and services will likely suffer as will new vehicle purchases as consumers remain conservative. The future is not as bleak as one might anticipate. The automotive...
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...Health Care Spending HCS 440 Economics: The Financing of Healthcare Class Group: BSEW1GQMZ5 University of Phoenix Online Instructor: Geoffrey J. Suszkowski, Ph.D., LFHIMSS 05/11/2015 Health Care Spending “In 2013 U.S. health care spending increased 3.6 percent to reach $2.9 trillion, or $9,255 per person, the fifth consecutive year of slow growth in the range of 3.6 percent and 4.1 percent. The share of the economy devoted to health spending has remained at 17.4 percent since 2009 as health spending and the Gross Domestic Product increased at similar rates for 2010 - 2013”("National Health Expenditures 2013 Highlights," 2013). The cost of health care spending greatly affects the way that individuals budget their spending. It is important the economy can adjust accordingly to individuals about whether health care spending is too much or not enough. Current Level of National Healthcare Spending The topic of healthcare spending in the United States is a controversial one, and most often, the populations' opinions doesn't always agree with those of policymakers. Getting health care spending under control is vital to the economic health of the government and the people of the United States. What makes healthcare expenditures so disgraceful is the large amount of money the government spends on healthcare each year versus the number of people without health care. The amount of money the U.S. government spends on health care each year doubles that...
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...Health Care Spending Ninnette Paulino HCS/440 Economics: The Financing of Health Care August 25, 2013 Michele Burka America’s national health care spending grew by 3.9% each year from 2009 to 2011, the lowest since the federal government began keeping these records in 1960. That slow growth appears to have continued into 2012, when expenditures totaled an estimated $2.8 trillion. The biggest reason for this slowdown is that people have spent less on health care in weak economic times. As people were losing their jobs they were losing their health coverage and then hold off on seeing a physician. Even workers that are employed with company-sponsored plans they face large-out-of-pocket costs that they’d rather avoid unless it is truly necessary (Luhby, 2013). According to the Kaiser Family and Foundation and Altarum Institute, they predict that this dampened spending pattern is unlikely to last much longer. As the economy picks up, health care spending is expected to increase, rising to an annual growth rate of more than 7% annually by the end of the decade (Luhby, 2013). When President Obama released his fiscal 2014 budget he proposed a chained CPI- to shrink cost-of-living adjustments for retirees. The use of chained CPI in Social Security and elsewhere in the budget would reduce deficits by $230 billion over a decade. It is also includes $392 billion in savings from Medicare and other health programs by raising Medicare premiums for wealthy retirees and negotiating...
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...Thomas Health Services Organization May 18, 2014 Crystal Russell, Instructor Funding the Rising Cost of Healthcare The United States’ total health care cost is expected to rise to about $4.8 trillion in 2021. That increase will be up from $75 billion from the 1970s. Health care spending will be responsible for approximately 20 percent of gross domestic product (GDP), simply stated it will equate to approximately one-fifth of the U.S. economy (Galewitz, 2010). Nearly 51 percent of the country’s spending goes towards the cost of medical services provided by physicians and hospitals, while prescription drugs account for about 10 percent. Private hospitals only receive approximately 3.75 percent of the nation’s overall health care spending. Some consumers as well as employers face hardships trying to afford health insurance premiums; therefore, many employers are unable to afford to offer healthcare to their employees. This is especially common in companies that employ less than 10 employees. With the constant rise in healthcare cost, about 49 million Americans were uninsured in 2012, while those who were insured faced an increase of 7.2 percent causing costs to exceed $20,000 for families. A comprehensive analysis of the impact of health care reform and a synopsis of where healthcare would be without reform was conducted by The Council of Economic Advisers (CEA). The analysis also included a report that identified market failures, the key aspects of health care reform...
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...spent on health care related issues in the United States each year which is more than any other industrialized nation; the majority of the expense is related to treating and managing chronic diseases such as various types of cancers. The impact of the declining economy can be attributed to the significant rise in health care cost which has affected work productivity and reduced the quality of health care services (Wiseman, 2011). The paper will discuss the two major economic principles; Marginal analysis and opportunity cost that commonly used to underlie and evaluated the current health system of today. Marginal Analysis Marginal analysis in health care is defined as the examination of additional benefits or costs that arises from additional consumption of goods, in today’s health care industry more money is being spent on health related services because of the increase of supply and demand; to simplify the definition cost rise when the consumption of goods increase, it is the principle of economics that shifts or changes the mix of resources used in health care spending (Mitton & Donaldson, 2004). Marginal analysis in health care is the better option to use when prioritizing services or goods, prioritizing goods based on the total needs will lead to inefficient use of resources. Resource allocations in health organizations are generally conducted on the basis political patterns which can often lead to misuse of already limited resources and as the health care budget continues...
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...material welfare of humankind (Apollo Group, 2010). Economics in health care is concerned not only with the financial aspects of the system, but how those financial elements impact patient care. Supply and Demand Supply and demand is perhaps one of the most fundamental concepts of economics and it is the backbone of a market economy. Demand refers to how much (quantity) of a product or service is desired by buyers. Supply represents how much the market can offer and the correlation between price and how much of a good or service is supplied to the market is known as the supply relationship. The demand for health care is limitless as is evidenced by the number of people who use health care services on a day to day basis. Supply, however, is limited by the availability of medical resources and the skill to administer care effectively. Macroeconomics Macroeconomics studies the economy as a whole. Macroeconomic analysis studies the roles of the government, exports and imports, consumption, investment, government taxes, and other factors in an economy. In health care, the macroeconomic market is the entire country’s health care system including the way that it performs in terms of profit, loss and efficiency. Macroeconomics of health is concerned with parallel sets of large scale system issues concerning spending for employment and other aspects of health as part of the economy. The biological health status which includes longevity, fertility and productivity are also...
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...NBER WORKING PAPER SERIES HEALTH CARE FINANCING, EFFICIENCY, AND EQUITY Sherry A. Glied Working Paper 13881 http://www.nber.org/papers/w13881 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 March 2008 I thank Courtney Ward for research assistance and participants at the conference on Exploring Social Insurance, held in Toronto, November 2006. A version of this paper is forthcoming as a chapter in Exploring Social Insurance: Can a Dose of Europe Cure Canadian Health Care Finance? Edited by C. M. Flood, M. Stabile and C. Hughes Tuohy (Kingston, Montreal: Queen's School of Policy Studies, McGill-Queen's University Press). The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications. © 2008 by Sherry A. Glied. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source. Health Care Financing, Efficiency, and Equity Sherry A. Glied NBER Working Paper No. 13881 March 2008 JEL No. H42,H51,I18 ABSTRACT This paper examines the efficiency and equity implications of alternative health care system financing strategies. Using data across...
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...the exponential growth of health care spending, as a portion of the GDP, will eventually consume much of the government income as well as suck the resources from personal consumption and create more issues to spiral out of control. The writer takes a deeper angle of looking at health care spending as a result of inconsistent production. To better understand the core of the problem, looking deeper at the health services, consumption of goods, and overall usage of resources have to be seen as a basis of GDP. In other words, as a society, everything people use for everyday living must be produced by the people themselves. If society only creates a certain amount of goods and services, but more of these same goods and services are being depleted at a rate higher than production, special attention must be given to this predicament. The author does not describe particular strategies or techniques, but seems to imply areas that require more focus and attention in order to redirect funding through the proper channels. Using the GDP as its guiding force, rather than just overall health care spending, the author uses graphical analysis to show how health care must be solved internally from a production standpoint (input adjustments) rather than just explaining how much is actually demanded by consumers. Personal health consumptions have risen indirectly with that of nondurable and durable goods showing that people are forced to use more their income towards health services. In the past 33...
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