All about the Money $$ Honey...
As a country we are spending twice as much on health care as most other developed countries. These expenses are only going to rise further with healthcare costs rising faster than income in most households. Technology has definitely paced forward taking costs with it. Though technology has made it easier and quicker to diagnose, and treat, it has also made it imperative that these lifesaving options be available to the population at large. Thus hospitals invest more and the cost rises.
The United States health care system is adept with inefficiencies. The system is complex with third parties involved besides the physician and the patient. These middlemen are a chain of individuals who dictate policies and work out brackets tailored to design healthcare expenditure based on a laborious system which is designed to provide healthcare to those who can pay the most. Its all about the money. These middlemen are insurance companies which dont necessarily fit the bill. As insurance companies get billed physicians and hospitals run batteries of lab tests not entirely based on the need since cost is not a concern. Eventually the burden is borne by all individuals.
In the current wave of economic hardships with job losses on the rise and employers not offering health insurance, it is becoming increasingly difficult for families to afford even basic health care. So where can we get rid of this extra cost? Maybe get rid of the middle men and along with it a lot of complexity. Bring in a single payer healthcare system which is state based, Universal Healthcare is definitely the way!
Wednesday, January 28, 2009
Tuesday, January 27, 2009
Its likely that they are both causing the dramatic increase in spending, but I feel that inefficiency in the health care system is more of a major contributor. Although our liberal use of technology can be costly, technology can also play an important role in preventative care. There definitely needs to be a happy medium for use of technology, but it shouldn't be completely discouraged. I believe that increased spending has more to do with inefficiencies within the system. Inefficiency and mismanagement affects the fundamentals of the health care system and are problems that have been lingering for decades.
I have heard many cases about doctors ordering unnecessary tests, labs, bringing on other doctors, etc. just to run up the patients bill. These are where some of the problems may lie. Hospitals are struggling to stay open and programs like medicare are falling short due to such inefficiencies. Work ethic should be observed and tighter regulations should be put on medical professionals, hospitals, and insurance companies. Spending seems to be increasing because the health care system is being run more like a business than anything else.
I have heard many cases about doctors ordering unnecessary tests, labs, bringing on other doctors, etc. just to run up the patients bill. These are where some of the problems may lie. Hospitals are struggling to stay open and programs like medicare are falling short due to such inefficiencies. Work ethic should be observed and tighter regulations should be put on medical professionals, hospitals, and insurance companies. Spending seems to be increasing because the health care system is being run more like a business than anything else.
I think that the question of "why do you think spending has been continually on the rise?" is a loaded question. There is not one simple answer to this question. I'm interested to see what the pie chart for a individuals medical cost looks like? How many slices would you see? I know that technology may play a role in the rise of cost, but is this something that we want to hinder. We know that health care cost are going up and they will continue to go up like other facets of our free market economy. I think the real question we should be asking is why health care cost are growing faster than our inflation rate. To answer this question, we would need to have a deeper understanding of all the intricate cost which are incurred from each patient. There are many individuals involved in health delivery and an increase at any level will have a positive correlation to every other level. Unfortunately, much of the burden for these increased costs is coming back directly to the business and families. People are having to make cuts in ways they have not had to in years. To give you an idea of how this is affecting the above mentioned parties I encourage all of you to take a quick look at the link I have provided below. It is the website for the National Coalition on Health Care. When you get a chance explore around the site. Take a look at all the tabs under facts about health care. Most of the data provided is very current and gives a good idea of what our nation is looking at in terms of health care at many levels from individuals and business to state and federal programs. http://www.nchc.org/facts/coverage.shtml
Dohhh!!! (As Homer Would Say...)
Americans have had multiple identities throughout their history: from patriots, innovators and hard-workers to being perceived as arrogant, obese, and the "world-police." But there is one word that sums up an American today unlike any other: CONSUMER. In a free-market driven by supply and demand, Americans pride themselves on the freedom of the individual and the advantage of the market place to dictate what will and won't work. Unfortunately, with the current economic crisis, many Americans have seen that the gluttonous behavior of biting off more than you can chew has caught up with them. From the average consumer that charges much more than he can afford on his credit card, to hedge fund managers from Harvard that saw their multi-default credit swaps and sub-prime mortgage derivatives go down the drain - Americans simply wanted more than they could handle. Unfortunately, this behavior not only contributes to the depreciation of the dollar, but can lead to the rise of the essentials of a consumer such as health care costs.
Without a doubt, much of this behavior has lead to an increase in national health spending per capita over recent years. However, the problem goes deeper than just America's economic climate and system; the health care system itself is an environment that brews a steady increase in costs. Spending an enormous amount of GDP to financing health care, lacking a universal health care system, and deferring accumulating emergency health care costs of people who don't have insurance to those who do have all been key reasons that health care costs continue to rise. With the current economic crisis forcing people to be more concerned with food and mortgage bills, issues such as health care will naturally take a back seat. However, Americans must be able to reach into their roots as "patriots" and "innovators" to try to embrace solutions such as electronic health care documentations and have the courage to force their public leaders to eliminate additional costs that accumulate from special interest lobbying groups within the health care system that eat up all that GDP. Homer Simpson would say it best: let's not loose all that... "Dohhhh!"
Without a doubt, much of this behavior has lead to an increase in national health spending per capita over recent years. However, the problem goes deeper than just America's economic climate and system; the health care system itself is an environment that brews a steady increase in costs. Spending an enormous amount of GDP to financing health care, lacking a universal health care system, and deferring accumulating emergency health care costs of people who don't have insurance to those who do have all been key reasons that health care costs continue to rise. With the current economic crisis forcing people to be more concerned with food and mortgage bills, issues such as health care will naturally take a back seat. However, Americans must be able to reach into their roots as "patriots" and "innovators" to try to embrace solutions such as electronic health care documentations and have the courage to force their public leaders to eliminate additional costs that accumulate from special interest lobbying groups within the health care system that eat up all that GDP. Homer Simpson would say it best: let's not loose all that... "Dohhhh!"
It is all about the MONEY!
I believe that the increase in the national health spending in due to several factors. Technology does pay a role into the increases. But many would argue and agree that the development of medical technology is useful and a wise investment of our money. However the increases due to technology I believe are not as great or significant as the increases due to inefficiencies. The healthcare system in the United States is a system that seems more focused on the policy and money issue than the real issue at hand, people’s health. Healthcare insurances have become like a bidding war to see who can get the most customers and in turn get the most money. Money and status in society play a big role in the access to services.
There needs to be a healthcare reform because as it is there are many families that do not have health insurance. Healthcare has become almost like a luxury for the rich people. I think that with the economic situation that we find ourselves in, we will see less and less people with health care insurance. The idea that a healthcare reform is needed is not new, but coming up with a system that will work with the mentality of Americans will be a challenge. It will be very difficult to change the views of the Americans. I think to begin with we need to think about healthcare as helping other people and not a political battle for money.
There needs to be a healthcare reform because as it is there are many families that do not have health insurance. Healthcare has become almost like a luxury for the rich people. I think that with the economic situation that we find ourselves in, we will see less and less people with health care insurance. The idea that a healthcare reform is needed is not new, but coming up with a system that will work with the mentality of Americans will be a challenge. It will be very difficult to change the views of the Americans. I think to begin with we need to think about healthcare as helping other people and not a political battle for money.
It's All About the Money
Healthcare costs in the United States are continuously on the rise for many different reasons. Of course the obvious is the increase in medical technologies available to doctors and healthcare providers. There are so many tests available that often doctors rely too much on tests and less on their clinical abilities and intuitions to diagnose and treat their patients. Understandably so, it is possible that this has also led to inefficiencies in delivering medical care to those in need. Therefore, more tests are being used to diagnose conditions that used to be done by clinical providers and this is causing greater expenses for the patients and institutions. There are also other reasons as to why healthcare per capita spending is increasing: an increase in lawsuits, malpractice insurance and emergency room coverage of costs that are causing patients to incur more than they bargained for in terms of necessary care.
I must agree with many of the previous posts in saying that the United States healthcare system has most definitely turned into more of a business than it ever had been. However, this is going to cause a huge problem for other businesses and families in being able to afford healthcare and coverage for even the most necessary of treatments. Businesses are not going to be able to offer their employees the same benefits, which in turn causes larger out-of-pocket expenses for the patient. In tangent to this, families might start to turn away from seeking out care for problems they otherwise would have because of this out-of-pocket expense. They are going to start viewing their medical health as an optional expense, which it never should be.
Overall, I think the view of the healthcare system and the never-ending increase in technologies is forcing the United States system onto a very dangerous path. As consumers/patients, we cannot afford the care that we often times need. However, as a business, the healthcare system cannot afford to continue operation if they do not increase their prices. So, if healthcare reform is not the answer, then what is?
Yes to all of the above!
It seems that, based on our experience, we can all attest to the above reasons playing some part in the rising costs. Technology is expensive! This is a fresh topic for me, having needed to get an MRI a month ago. Think about the cost of MRI machines... according to comparemricost.com, the average MRI machine costs above $1 million dollars. I'm sure some of that cost got paid off by me. Inefficiencies?... perhaps. And prices?... definitely! But might I add malpractice insurance? It seems that suing is a fad these days! Although I don't have exact figures, I do know MDs pay a lot for insurance, which ends up reflected in health care costs. The more health care costs rise, the less available it'll be for families to obtain it, especially with money being scarce these days. In fact, with our economic crisis, a lot more of us will be thinking twice about going to the get that check-up.
Healthcare costs in the US are increasing due to extreme levels on inefficiency, misallocation of funds, and defensive medicine. Unfortunately, medicine is a business, and as time goes on it's being run more and more like a business. Between the excessively complicated insurance and reimbursement system, liability issues, and the ever-growing underserved population there is too much disorganization for the system to run efficiently. It needs to be simplified and streamlined.
Unfortunately, capitalist notions of free-market competition don't work for health care. Instead of providing options and lowering costs for consumers as it is intended to, it instead adds yet another pressure to the system. Healthcare costs would be streamlined if we adopted a more unified and consist healthcare system focused on universal coverage, minimizing costs, maximizing efficiency, and cooperation.
It's All About the Money
I definitely believe that there are many factors that contribute to the increase in national health spending per capita. I mean there are a lot of people without insurance that use the emergency room for primary care. By this time, the patient has probably let the problem get bad enough to even obtain medical attention and at this time it probably cost a ridiculously amount of money. We also need to consider the cost of insurance. The cost of insurance is progressively increasing each year. Not only is the premium expensive, but the co-pay is also increasing. These problems really hit families with low SES. Going on with insurance, HMOs are very inefficient. For example, I needed to see an allergist. So I had to go to my primary care provider, pay a $30 co-pay, the doctor put in a request for a referral, I then had to come back to my primary care provider to provide a blood sample (costing another $30 co-pay), and then 2 weeks later finally got approved to see an allergist (which is another $30 co-pay). Summary: 2 weeks later, 2 primary care providers, and $90àjust for a referral. GAAHHHH! This was a very very inefficient process. New developments in technology also contribute to the increase cost of per capita health spending. As more research, time, and money are spent to develop new medical procedures, the costs of these procedures are extremely expensive.
In the current recession, less people will be uninsured. Less people will be going to get treatment meaning more people being untreated and letting their illness worsen. The government needs to put more emphasis on healthcare. If the state and national government sets healthcare as a priority and increase the budget, then more people will be able to seek medical assistance.
Necessary Commodity vs. Necessary Evil
Ditto to the comment posted by M. Arias. Americans will swipe and pay for the latest and most up-to- date gadgets, cars, fashion, make-up, surgery etc. The escalating amount spent on health care perpetuates because health, like gas (or clothing, a beautiful home, a lap top , ipod), is a necessary commodity valued by Americans which will be purchased at any cost. CEO's of HMO's are aware that increasing the tag price on a needed surgery or an MRI or a medication for a chronic disease will not turn away its customers, so why not hike up the digits on health which is gauranteed to be paid for by desperately ill consumers who need the service to survive. The health care system can be compared to economics as stated by White (2007) in "Health Care Spending Growth: How Different is the United States from the Rest of the OECD?". Health care is a commodity that possesses a very high demand: mothers, children, and elderly are in constat need of medical attention. The high demand of health care and the desperation to attain it gives HMO's the power to rasie prices at their own will. Treatment, medication, and the service to care for the ill is a necessary commodity to survice. The necessary evil is acquiring those services through filters here in the U.S.: HMO's, private insurance.
We Are a Sad Sad Society --> Nation
If we compare ourselves to other countries, we are one sad community. What are spending on and why? I agree with Anand in the ridiculous competing prices amongst health care providers, but then again, we are spending in selfish ways.
Let me rephrase that… health care is catering to the rich, so whatever the rich can afford will be the competing price amongst those providers. Wafa’s cartoon is so amusing, so funny, and, unfortunately, so true. This country is about providing for the rich because it is given that they can afford it. Technology can be a contributing factor in this rise, but I don’t think it may be a determining factor. This spending will have a large impact on poor communities (duh!) as prices will rise and they will continue to be unable to access quality health care. “There’s no need in getting their hopes up.” Consequently, this sad situation is in a much needed health care reform system. Lets consider universal health care and re-evaluate our communities and meeting the quality of life for all and not just the rich.
Let me rephrase that… health care is catering to the rich, so whatever the rich can afford will be the competing price amongst those providers. Wafa’s cartoon is so amusing, so funny, and, unfortunately, so true. This country is about providing for the rich because it is given that they can afford it. Technology can be a contributing factor in this rise, but I don’t think it may be a determining factor. This spending will have a large impact on poor communities (duh!) as prices will rise and they will continue to be unable to access quality health care. “There’s no need in getting their hopes up.” Consequently, this sad situation is in a much needed health care reform system. Lets consider universal health care and re-evaluate our communities and meeting the quality of life for all and not just the rich.
Living Beyond Our Means
Lets face it most Americans love to live comfortably and will do what it takes to attain this level of comfort whether it means barrowing on the house, purchasing it with plastic, or simply doing whatever it takes to have what they want. If it’s the latest gadget or trend I’m sure most will go out of their way to get it. So the same mentality is set in place when we need medical coverage. If you want or need it bad enough you must do whatever it takes to get it, right? Well unfortunately medical coverage is a lot more costly than the latest gadget or trend. It leaves us with big dents in our pockets. So, different standards have to be in place for attaining quality medical coverage in the U.S. such as smoothing out the kinks in all the administrative work, regulating how much pay will go towards specific procedures, and above all giving consumers the buying power they deserve when it comes to receiving quality medical coverage. In these tough economic times, hopefully our administration will see the cracks in the system (as promised will go through the book with a finetooth comb) and work towards improving our health spending per capita so that future generations do not have to work to pay our big deficit we have created.
All About Whose Money?
From the birth of health care in the US, the system was focused on making money. Any kind of public service that wasn't able to be governed by the free market was quickly attacked and shut down by those who were in the position of losing profits. I never thought about the extent to which Americans seem to have an innate need for the concept of the free market in any industry. That tradition has carried into present times where our health system is run by a hodge podge system of private and public funding. Most working Americans have the attitude that they are contributing to the economy by participating in the work force and have earned the right to health care. The idea is that if one can pay for better health care than they deserve to be treated better than those who cannot. The problem is that no one (or so few that I can't name one person I know who is exuberant over their coverage) is actually getting this superior service. The reality is that we are all paying for each other's health care and that simple idea isn't clearly conveyed to the general public. If more people were educated on the exact breakdown of where their employer contribution combined with their own out of pocket costs to health insurance were going, I think there would be a huge backlash as to how money is spent regarding health care in the country. Our current health care system is not set up for a free market battle which is unfortunate since Americans insist on pushing this idea upon all markets regardless on how inefficient the result.
"They Couldn't Afford it Even if it Works."
Perhaps we're spending too much on technology to treat growing medical problems and not enough on technology to research and prevent the problems from growing.I'm no expert on economic issues but it's my humble opinion that if we spent more in the research field we'd potentially spend less in the treatment field. It's not that we don't need technology or it isn't a major benefit in the treatment realm. On the contrary, I feel as though it is vital. However, it's just as important, if not more, to figure out how to prevent people from getting sick in the first place.
At risk of being sounding idealistic regarding a system that we know is faulty and far from being patient-centric, I believe the most important issue here is how that increase is going to impact those who are already struggling to afford health care. What good is an increase in spending when it's not benefiting the people who might need it most?
I'm not sure there's a real answer to that question because the situation is so complex. A poorly executed system in any field drains unnecessary resources. Technological advances cost a lot of money but few people argue the spending when there may be some tiny remote chance the technology could treat cancer or detect genetic disorders. It's a field that allows for a lot of justification for spending but when the affects of that trickle down to the pocketbooks of everyday Americans what do you say? I think that's an age-old question whenever it comes to spending, anywhere.
I believe its time that we start to utilize our resources to their fullest and start focusing on how to make it so that people need these expensive treatment technologies less. It's such a loaded issue and so multi-facited that to think there there are even only twenty factors that play a large role is, I think, naive. There are so many people, organizations, businesses, so much politics and the like involved that before we can even get people to care about how we can make everything more cost efficient we need to come up with a better understanding of why it is and why we should.
It's all about the money
I totally agree with those who claim that a considerable amount of the spending and so the cost is because of the inefficiencies in the programs. But I believe inefficiencies have always been there, so why are we spending a lot more. Well, the advancing technology would never be put aside, or abandoned. Once one said that human beings have never stopped doing the things they were capable of doing. So, we will have the technology and we have to use it. But I don't think that is the problem either. I believe that our nation is getting sicker and sicker by generation. The amount of money americans spend on cosmetic surgery is not much if we realize that this money is mostly being spent in California, or New York. I believe the nation is becoming sick mainly because of the way we eat. America mainly eat large unhealthy portions. 40% of us are obese. I think the older generation spend a lot of money on healthcare. With the kind of a lifestyle they had, and since they have not paid attention to prevention much, they have to use a lot of medicine and care in old age. And I am afraid we will be sicker when we are that age.
make the system more efficient will help...
According to Exhibit 1, national health spending per capita is projected to increase to over $12,000 by 2016. Why do you think spending has been continually on the rise? Is it technology? Inefficiencies? Or maybe "it’s the prices, stupid"? What impact do you think this will have on businesses and families, especially with the tough economic times we are currently facing? And with all the talk about much needed health care reform, what are some options we should consider to control these costs?
Honestly this is a very difficult question to answer since there are various combination of possibilities to cause the increase of spending per capita. However most of all, I strongly believe there is an urge to reduce the unnecessary administration work and redundancy at diagnosis process. By my past experience, I was even afraid to go to school health care center just to have a check-up. I always had to wait for a long time to make an appointment (it can't be just walk-in), and when I finally got into the examination room I needed to wait for at least ten minutes till the nurse came to ask me "so what's the problem". Nurses always left shortly and then I had to wait for another 10 minutes till the real doctor came in and asked me the same question again. I don't think there is even a need to have nurses come to talk to patients before seeing the doctors, because nurses' duties are to take reports about the patients' physical condition and what the patients say about their problems. And seriously, I believe physicians can ask those questions themselves (and they do). I strongly feel redundancy of administrate work and diagnosis processes are one of the big reasons why American has spent double to triple of money on health care compare to other countries each year. As an immigrant from Taiwan, I had never experienced a problem of repeating the same symptom to various of people and spent hours just to get a small problem cured. In addition, I had never needed to fill out multiple similar questions forms every time I go see doctors. It is a vicious cycle because immigrants who are afraid to see doctors due to the language barrier and tedious treatment processes will cause them unwilling to see doctors when they have minor illness. At the end, the people who refused to see doctors will develop into severer diseases if the minor illness are not treated properly. Eventually it will cause more money since a good portion of immigrants are living under poverty and need government's support. Other countries have make their health care system more efficient while American have wasted too much energy, time, and money on something that are not necessary. If we are able to make the system more organize and reduce the unnecessary work, the cost of health care fee per person will reduce. Moreover, I agree what other classmates say about competition between insurance companies. If the policy can be regulate and uniformed the insurance fee and system, the insurances won't be reluctant due to competition.
Honestly this is a very difficult question to answer since there are various combination of possibilities to cause the increase of spending per capita. However most of all, I strongly believe there is an urge to reduce the unnecessary administration work and redundancy at diagnosis process. By my past experience, I was even afraid to go to school health care center just to have a check-up. I always had to wait for a long time to make an appointment (it can't be just walk-in), and when I finally got into the examination room I needed to wait for at least ten minutes till the nurse came to ask me "so what's the problem". Nurses always left shortly and then I had to wait for another 10 minutes till the real doctor came in and asked me the same question again. I don't think there is even a need to have nurses come to talk to patients before seeing the doctors, because nurses' duties are to take reports about the patients' physical condition and what the patients say about their problems. And seriously, I believe physicians can ask those questions themselves (and they do). I strongly feel redundancy of administrate work and diagnosis processes are one of the big reasons why American has spent double to triple of money on health care compare to other countries each year. As an immigrant from Taiwan, I had never experienced a problem of repeating the same symptom to various of people and spent hours just to get a small problem cured. In addition, I had never needed to fill out multiple similar questions forms every time I go see doctors. It is a vicious cycle because immigrants who are afraid to see doctors due to the language barrier and tedious treatment processes will cause them unwilling to see doctors when they have minor illness. At the end, the people who refused to see doctors will develop into severer diseases if the minor illness are not treated properly. Eventually it will cause more money since a good portion of immigrants are living under poverty and need government's support. Other countries have make their health care system more efficient while American have wasted too much energy, time, and money on something that are not necessary. If we are able to make the system more organize and reduce the unnecessary work, the cost of health care fee per person will reduce. Moreover, I agree what other classmates say about competition between insurance companies. If the policy can be regulate and uniformed the insurance fee and system, the insurances won't be reluctant due to competition.
Progressive Technology Does Not Equal Progressive Health
I'm certainly in line with the school of thought that technology does drive up healthcare costs tremendously. Medical technology must first be defined. I believe includes both pharmacological, machinery, and biological advances to advance and improve societies health. The key words here are "advance" and "improve." The big bucks are most often found in the designer, cutting edge drugs, as well as new machinery such as lasers/MRIs etc. The real issues that need rectifying are often the simplest. These include primary healthcare and getting prescription drugs only to those who truly need them
The problem with medicines overblown love-affair with technology is that it often times does not achieve its intended purpose: to improve the health of others. It is misguided reasoning to believe that just because something is new, expensive, or has passed one stage of a clinical trial, that it will automatically benefit the masses. Before we fully embrace and trust new innovation, we must first do a more thorough cost/benefit analysis. Take a case in point in which we originally thought using mercury to treat STIs was effective and safe. It took years before the medical community admitted their wrong doings by using mercury as medicine. Maybe we'll look back on the modern era and realize our wrongdoings, but unfortunately, this takes time and requires many human beings to be societies' guinea pigs to test our "innovations."
At the end of the day, health is less about innovation and more about motivation where people are educated about health, nutrition, and well-being and pursue these as a means not only to benefit themselves, but society as well...Afterall, we're all in this together.
Countin the Health Care Benjamin$
According to cosmeticsurgery.com
There is no question that we in America devote a ridiculous amount of money on health care. We are pretty much at the forefront of medical technlogy and those who seek health care are definitely realizing the cost associated with having such innovative techonology. The fact is that we have a really intricate health care system that allows everything from a much needed bone marrow transplant for a sickle cell anemia patient to a cosmetic nose job for Betty Big Bangs. Such an intricate health care system incorporating doctors and other health care professionals with umpteen subspecialties is going to continue to rise in maintenance and cost with newer technologies.
But I would definitely have to agree with Hailin when he says our choices also play an important factor in this issue. We must understand and come to terms with the fact that prices are likely going to continue to rise (barring a massive donation to the U.S. Health Care System courtesy of Warren Buffet). Hopefully in the coming years we will make more conscientious decisions with a focus on preventative measures as opposed to spur of the moment massively expensive life saving procedures which could have been avoided through a steadier diet and/or screening. This preventative mentality would certainly have a tremendously positive impact on families and businesses in terms of saving them money. Also maybe, as a nation, we should cut back on the number of botox injections (no disrespect Betty Big Bangs).
- 2.8 Million: Number of Botox injections given in the U.S. in ’03.
- 6.9 million: People who had a minimally invasive procedure in ’03.
- 8.7 Million: People who had some cosmetic procedure in ’03.
- 10 million: The estimated number of cosmetic patients who will have gone under the knife by the end of ’04.
- 1.9 million: number of cosmetic surgery procedures done in ’01.
There is no question that we in America devote a ridiculous amount of money on health care. We are pretty much at the forefront of medical technlogy and those who seek health care are definitely realizing the cost associated with having such innovative techonology. The fact is that we have a really intricate health care system that allows everything from a much needed bone marrow transplant for a sickle cell anemia patient to a cosmetic nose job for Betty Big Bangs. Such an intricate health care system incorporating doctors and other health care professionals with umpteen subspecialties is going to continue to rise in maintenance and cost with newer technologies.
But I would definitely have to agree with Hailin when he says our choices also play an important factor in this issue. We must understand and come to terms with the fact that prices are likely going to continue to rise (barring a massive donation to the U.S. Health Care System courtesy of Warren Buffet). Hopefully in the coming years we will make more conscientious decisions with a focus on preventative measures as opposed to spur of the moment massively expensive life saving procedures which could have been avoided through a steadier diet and/or screening. This preventative mentality would certainly have a tremendously positive impact on families and businesses in terms of saving them money. Also maybe, as a nation, we should cut back on the number of botox injections (no disrespect Betty Big Bangs).
Mo Money, Mo Problems
My buddies Notorious B.I.G. and Puff Daddy said it the best. The more money you have, the more problems you have. However, the problem with our per capita health spending is not the same problem B.I.G. and Puff had, its more of the more money our government is spending, the more problems it is causing the people. The government keeps trying to one up everyone in the world, so theyre trying to be the biggest and baddest in everything. If you wanna be a baller, you have to have the ca$h. But there isn't anything wrong with being a baller on a budget, cause a baller on a budget will be a baller for life, not just a baller this year. Spending money you dont have isn't cool either (aka: debt). I think that one of the major reasons for the continual increase in spending every year is due to the rising cost of technolgy, which is also a direct result of the rising cost of materials to produce them. The widespread use of the high-cost super-technological machines is going to cost money. You gotta pay to play. Another reason I think may be overlooked is how lawsuit-crazy the people in the United States are. Everyone's tryin to hustle and make that paper, but this results in high malpractice insurance for doctors, and then physicians try to run more tests just to cover their rear ends so that if a patient ever does come back to sue them, they'll be like "I ran all these tests, so you dont have a case against me!" Even though, HMO's usually somewhat prevent this from happening because they have to screen and regulate all the tests that are approved, it still does play a role in the rising cost of health care. These rising costs of health care will definitely have a big effect on the regular joe or jane. Millions of people are not even insured, and there are so many just barely getting by with the cost of insurance. People will not only have a much harder time getting by with health insurance, but I think that more people will not have life insurance either because they will stop getting it or they will refuse to sign up for it.
What is the solution? Its all about being efficient with what we have. Technology is great, the faster we can perform tests, the easier it would be to access medical records from any computer database, and the more artificial organs we can make, the more inspired we feel to make everything better. However, I believe the United States is already more advanced than any other country out there in regards to technological health advances, that is why many people fly from all over the globe to the United States to get treated. It is time to get to know our technology, to make it our friends. We don't need to have the biggest and best technolgy, what we need to be the best in is being able to provide the greatest health care to the citizens. The United States needs to shed its pride and realize that all this spending per capita does not have a direct effect on how healthy our people are. All these big insurance companies are charging almost whatever they want to charge for their services. If the government somehow increased competition among these companies, then they would have to decrease their prices, and hopefully health care would become more affordable to the people and to the government.
The United States needs to learn to be a baller on a budget. Work with the technolgy you have, if you already have the Lamborghini Gallaro, then why do you really need to upgrade to the Murcielago? Just because you want the suicide doors? Now you're just throwing money around. The United States already has great technology in place, and they now just have to train the health care providers how to use them more efficiently, and that will make for a better system than giving them super-advanced technology that they can barely use. Increase the competition: isn't gas so much cheaper when there are 2 or 3 gas stations at the same intersection? Who will be the winner? The consumer!
There is definitely a plethora of reasons that are leading to such a significant rise in costs. There is definitely an increasing number of people who are living longer and therefore the number of elderly is increasing. Along with the being older and living longer, there is the possibility of more prolonged time period for chronic diseases, nursing homes, and other long-term health care needs which are causing costs to rise because of everything from medications to hospital care. At the same time, as the older population increases, there may not be enough of the younger population or "active working" population to offset the costs caused by the increase of an ever increasing older population.
More costs is definitely harder on people because of bad economic times, but at the same time more and more people are signing up for government programs for care...which has its own set of issues as more people sign up for it, but the tax dollars for the programs are coming from working tax payers...
Since many of the chronic diseases and preventable diseases such as heart disease & diabetes are the ones that are prominent in morbidity now a days, we should definitely put more money into preventive medicine. The problem is the government wants to see immediate results, the people want to see immediate results and we all know that doesnt happen in preventive medicine. Unfortunately this ends up in a situation, where the best solution wont get the needed $$ because the solution does not appear to be the solution, because it's not immediate.
It's All About Where the Money GOES
In attempting to rectify our nation's dire health care problems, it is necessary to view the problem from all sides. It is not simply due to one factor such as technology or inefficiencies in the system, but a consolidation of all of these individual factors into one gargantuan problem. For instance, what good is the development of a state of the art MRI machine if a large proportion of the population cannot even afford the luxury of being able to see a primary care physician? As wonderful as developments in science and technology are, it seems that the amount of emphasis that has been given to these areas has been too much since the biggest problem our country's health care system faces deals with insuring as many people as possible, which is a problem that cannot be rectified by continually allocating funds towards any other resources other than the Medicare and Medicaid programs. As more and more citizens are becoming unemployed and eventually, uninsured, we can only expect to see the cost of health care skyrocket in the years to come.
As a result of these skyrocketing costs, business and families are going to continue to suffer. Without the ability to maintain one's health, they also lose the ability to make a living for themselves and their families. Once more and more people begin to skimp on preventive services or routine checkups and feel the need to only resort to hospital visits for emergent cases, it is likely we will see the number of people who comprise our healthy and capable workforce dwindle. If people cannot stay healthy, they cannot work. It's as simple as that.
Considering the current state of our economy it is even more important now that the government be able to prioritize what exactly the funds in the stimulus package will be disbursed to. Less money should be allocated to advancing technology if we cannot even provide basic care to the neediest patients. In addition, I believe that the prioritization of funds would benefit by borrowing from the 80-20 rule, which basically says that 80% of any specific effects comes from 20% of the causes. Adapting this rule to the health care reform plan, it seems that focusing on helping the lowest 20% that are in need of health care financial assistance will help to alleviate up to 80% of the problems we are currently facing today. Thus, I believe that our whole nation would benefit tremendously by allowing health care to be accessible and affordable to everyone, or as it's better known as, Universal Health Care.
As a result of these skyrocketing costs, business and families are going to continue to suffer. Without the ability to maintain one's health, they also lose the ability to make a living for themselves and their families. Once more and more people begin to skimp on preventive services or routine checkups and feel the need to only resort to hospital visits for emergent cases, it is likely we will see the number of people who comprise our healthy and capable workforce dwindle. If people cannot stay healthy, they cannot work. It's as simple as that.
Considering the current state of our economy it is even more important now that the government be able to prioritize what exactly the funds in the stimulus package will be disbursed to. Less money should be allocated to advancing technology if we cannot even provide basic care to the neediest patients. In addition, I believe that the prioritization of funds would benefit by borrowing from the 80-20 rule, which basically says that 80% of any specific effects comes from 20% of the causes. Adapting this rule to the health care reform plan, it seems that focusing on helping the lowest 20% that are in need of health care financial assistance will help to alleviate up to 80% of the problems we are currently facing today. Thus, I believe that our whole nation would benefit tremendously by allowing health care to be accessible and affordable to everyone, or as it's better known as, Universal Health Care.
Monday, January 26, 2009
It's All About the Money @_@
I would like to give my answer in another way. The health care spending could be divided into 2 types: public and private. Public health care spending includes government run programs like Medicare and Medicaid, while private spending includes doctors' services and prescription drugs. I agree that technology, inefficiencies, inflation would contribute to the increase in public health care spending, but it seems that there’s one more factor which would act in private health care spending: our choices.
We are more and more willing to spend our money on health care (prevention rather than diagnosis) as we are coming to realize how important health care is in our life. We go to our doctors for advices more often than before, and would like to spend money on early screening but not diagnosis. These health services we use are also causes for increase in health care spending.
We would be glad to see this since public health workers are doing their job:)
It's all about the money
The problems with health care in the U.S. have created a flawed system that would be impossible to fix by addressing just one issue. Our current situation is a result of a culmination of advancing technology, unintentional inefficiencies, and the rising cost of living among a host of other issues. If we look at any of these issues individually, we see that each has its own purpose or excuse. Medical universities pride themselves on the amount of money they have to research with. This is indicative of the American obsession with making things better than they were before. In the medical realm, it seems only fitting that our money is spent to find better, more successful methods to aid us in curing others. Of course, this seemingly philanthropic venture requires much more money than one would expect. We see that for each issue that plagues our healthcare system, there is a reason it became the problem that it is.
According to lecture, financing of health insurance coverage of the nonelderly population in 2007 shows that 21% of the federal budget is allocated to Medicare, Medicaid and SCHIP. This large amount of money is spent for approximately 35% of the population while the other 65% relies on private insurers. A scan of the budgets of other developed countries shows that this inordinate amount of money seems even more disproportionate when we look at how little other countries are spending on their healthcare systems. Even with our increased spending, we still lag behind while other countries have seemingly found their solution.
Though some people may dread the prospect of a universal health care system and its association with a “socialist” government, we fail to realize that aspects of our very own healthcare system are based on social health fundamentals. The Medicare system that our elderly population knows and loves is based on the social insurance ideals of large government roles with a centralized financial system. For the population under 65, we view our tax dollars being spent to inevitably help us when we need it. As Jean laid out so well in her blog post, the insurance system, and also Medicare, is based on a combined risk “fund” that can be accessed by everyone who buys into it. Though universal health care seems like a valid option, what remains to be addressed however, is the idea of a fundamental overhaul in the healthcare system already in place in our country. This approach is somewhat idealistic, especially when we consider Obama’s upcoming budget does not mention any hint of health care reform. With time and a systematic approach to solve each of healthcare’s major issues, we can witness a positive reform of our system.
According to lecture, financing of health insurance coverage of the nonelderly population in 2007 shows that 21% of the federal budget is allocated to Medicare, Medicaid and SCHIP. This large amount of money is spent for approximately 35% of the population while the other 65% relies on private insurers. A scan of the budgets of other developed countries shows that this inordinate amount of money seems even more disproportionate when we look at how little other countries are spending on their healthcare systems. Even with our increased spending, we still lag behind while other countries have seemingly found their solution.
Though some people may dread the prospect of a universal health care system and its association with a “socialist” government, we fail to realize that aspects of our very own healthcare system are based on social health fundamentals. The Medicare system that our elderly population knows and loves is based on the social insurance ideals of large government roles with a centralized financial system. For the population under 65, we view our tax dollars being spent to inevitably help us when we need it. As Jean laid out so well in her blog post, the insurance system, and also Medicare, is based on a combined risk “fund” that can be accessed by everyone who buys into it. Though universal health care seems like a valid option, what remains to be addressed however, is the idea of a fundamental overhaul in the healthcare system already in place in our country. This approach is somewhat idealistic, especially when we consider Obama’s upcoming budget does not mention any hint of health care reform. With time and a systematic approach to solve each of healthcare’s major issues, we can witness a positive reform of our system.
Healthcare for all
I definitely believe that all these factors contribute to the increase in national health spending per capita. My undergraduate major at UCI was biomedical engineering and we were always learning about new devices that were being developed or about the advancements in artificial organs, stents, pacemakers, etc. All these are very important pieces of technology that I do believe should be studied and researched but they do cost a lot of money. At UCI each of my engineering professors were working on a different device, in a different laboratory with different equipment, researchers, computers, and so on. Although this is all necessary to run a successful research project, it all costs a lot of money. The national government must fund all these research projects and hospitals must pay for all this new equipment that is being made available to them. Also, now that President Obama has lifted the ban on stem cells, research in this field is going to increase drastically meaning even more money is going to be spent. Furthermore, as we discussed in class, inefficiencies play a factor in this rise because extra vaccines are given and unnecessary tests are being run.
Today in the California Healthline there was an article that mentioned how officials in Sacramento County and Orange County are planning on getting rid of some positions, laying off workers, and even cutting back on some services on health programs because of budget deficits. This is just going to results in more people going to the emergency room and free clinics. As a volunteer in the emergency department of a hospital, I always see just how packed the ER can get. Many people come in for non-urgent cases because they don't have insurance and are taking up a lot of space in the department. And just as rwoon said, the ER must pay for these uninsured individuals and as a result, medical service costs increase. Therefore, I believe that the best way to solve this problem is universal healthcare. This way the government would pay for health care so that it can be affordable for all.
Reasons for increasing health care expenditure
1) It's the baby boomers. Our text says that Medicaid spending covers people of all ages but actually spends mostly on the elderly and disabled. As the baby boomer generation gets older, they will use more health related services like surgeries and x-rays, among other treatments, as well as prescriptions. As a SOLUTION: I would suggest that we focus on patient primary care and continue to increase salaries for primary care doctors. Another solution is to make it worthwhile for all adults to make it to their regular check ups if they have providers for health, dentist, optometrist.
2) It's also patient apathy. Our text says that insurance companies negotiate with hospitals how much they will pay for a particular service. If the fees are to high for insurance companies to make a profit, they will pass it on to companies premiums, then the companies will pass the cost on to the consumers of their goods. In this case, employees will not get affected, especially since the employers would rather have happy and healthy employees. As a solution: I would suggest single-payer system. This way, we could continue quality through health care competition but keep the financial department out of the hospitals.
2) It's also patient apathy. Our text says that insurance companies negotiate with hospitals how much they will pay for a particular service. If the fees are to high for insurance companies to make a profit, they will pass it on to companies premiums, then the companies will pass the cost on to the consumers of their goods. In this case, employees will not get affected, especially since the employers would rather have happy and healthy employees. As a solution: I would suggest single-payer system. This way, we could continue quality through health care competition but keep the financial department out of the hospitals.
In the U.S. it is all about the money.
There are many reasons that contribute to the increase in national health spending per capita. I think the main problem is the inefficiency of our health care system. Funds are placed in areas that do not seem to be improving health services at the same rate that spending is increasing. Advancements in technology are definitely costly and they do contribute to the rise in spending. However, what good is this technology if it is not easily accessible to the people who most need it? It makes sense that if more funds were placed into preventive care and primary care then it would not be so costly to keep Americans healthy. It is more costly for a person to try to cure a disease than taking the necessary precautions to prevent the illness. Although diseases many times are due to genetics, they are often brought upon or worsened by individual’s lifestyles and behaviors. But the U.S. seems to operate on a system that favors profit over health. There is a hierarchy in the U.S. health care systems that favor insurance companies, physicians, employers, and lastly patients. From personal experiences I have come to see many a times cases where health practitioners seem to ignore certain health conditions of patients and allow them to worsen before they decide to take the correct and necessary action. To keep my opinion clear, I do not think this true of all physicians. For example, my father was injured at work and sent to medical services through the employer’s insurance. His back pain would impede him from regularly attending work. The physician would advise for massage therapy and medicine to control his back pain that would only alleviate momentarily. My father decided to seek a second opinion and sought medical service aside from his employer’s insurance. In reality my father needed a costly surgery of which the employer was trying to avoid.
I also think that if there were a universal health care system that offers affordable healthcare for everyone and is driven to maintain patient’s health, then spending would probably be more efficient and less costly. Too much money is being spent on creating and maintaining multiple programs that only help limited and selected populations. Money is spent in patching up the flaws in our system, when it might be more cost-efficient to invest in a whole new system.
I also think that if there were a universal health care system that offers affordable healthcare for everyone and is driven to maintain patient’s health, then spending would probably be more efficient and less costly. Too much money is being spent on creating and maintaining multiple programs that only help limited and selected populations. Money is spent in patching up the flaws in our system, when it might be more cost-efficient to invest in a whole new system.
Tracing the money problems...
I think to some extent, everyone in the country can agree that the current health care system is flawed in one way or another. There are so many different ways that medical care is paid for that it is difficult to pinpoint the problems. I think it is a fundamental problem with the way that health care has been thought of for years. It has turned into a business - one that is dynamic within the free market, driven by profit instead of quality.
Since the primary issue is whether profit is made instead of, "Are people healthy and able to obtain sufficient care if they are unhealthy?" the US health system has become extremely expensive in the past 30 years without becoming comprehensive.
Let's start with your average American: probably working a 9-5, reasonably healthy, might have kids, probably has a spouse, and definitely doesn't want to go bankrupt in the event he or she has a medical emergency, or possibly becomes suddenly UN-healthy. Because of the fear of not having enough money to pay for medical care (that falls under the right to life), as stated in our Constitution, our average American opts into the health insurance plan offered to him by his employer.
This employer, in the interest of appearing attractive to potential employees, has found a health insurance plan, and pays into it, in order to offer it to its employees. Oh, and it receives a federal tax credit while doing so. Probably though, the insurance plan isn't absolutely comprehensive, because no insurance plan is.
Now, this insurance company makes its profit by contracting with medical providers, offering them a certain rate of reimbursement for the procedures and tests they perform. Said insurance company might simply pay a flat rate to a hospital for a certain disease's treatment course, and so the hospital now has incentive to not run any extra tests that might be preventive in nature, as well as the incentive to hurry our average American out the door as soon as possible. The insurance company also provides a list of acceptable medications, among which are older generic versions of comparable drugs, so that our average American has to choose between paying $10 for older generic prescription and paying nearly $100 for the latest, Dr. recommended prescription. Average American doesn't really understand the benefit of the latest drug, and so decides on the cheaper one. Only to find out later that had he or she taken the latest, they might have been able to prevent a serious medical problem a few years later. Good thing they saved $90.
Physicians, driven also by making more money, increasing their clout in their communities, and paying off all their student loans from their very expensive education, contract with certain insurance companies - usually the ones who pay them the most per procedure. Getting paid, after all, is what delivering medical care has come to in these times. As a result, the physicians are scheduling patients far too close together to give them sufficient attention, and so our average Americans probably don't understand what is going on with their health. But, there are so many forces at work with every aspect of the medical field, that there is no other solution within the current framework.
Obviously, this is just one point of view, but personally, I feel that there is too much business in health care right now for much of this to conceivably change. The scenarios above don't even get into the other systems (Medicare, Medicaid, VA, IHS, SCHIP, etc) in the US and why they cost so much money, but suffice it to say that the basic reason we spend so much money on health care is because someone, somewhere is profiting from the necessity of medicine.
All I want to know is, why can't we all band together and change this, once and for all?
A Thought Experiment
I believe it's so difficult to determine exactly what is contributing to the rising costs of healthcare that any research that definitively points to any particular factor is probably suspect. Han Tun cited the report by Ginsberg via the Robert Wood Johnson Foundation (which is an excellent and comprehensive study that I would highly recommend reading), and even though his well-constructed analysis leads him to the conclusion that medical technology is one of the major contributors to rising healthcare costs, Ginsberg notes in his conclusion that, "the area covered by this synethesis that is least understood is medical technology...the process of selecting technologies [to study] is so unstructured so as to leave real concerns about how representative those technologies are."
Rather than trying to pinpoint specific factors, which will only lead to specific reforms, I feel that it is more constructive to examine the fundamental economics behind healthcare spending, which will lead to broader, more comprehensive reforms.
Health economics can get exceedingly complex (with lots of very awesome math), but let's just whittle it down to a very simplistic thought experiment that will flesh out the major issues:
The thriving nation of Example consists of 100 people. The people are divided into two populations: the healthy and the sick. At any given time, there is a dynamic equilibrium where 10 are sick and 90 are healthy (that is, some of the 10 sick people will eventually become healthy, but they will be immediately replaced by some healthy people that become sick. Crucially, the sick population does not always consist of the same 10 people).
There is only one sickness: skin cancer. It is non-contagious but cannot be resolved without significant medical intervention. The cost of curing skin cancer is $1,000. Everyone in the nation earns an identical income of $500 per year.
Right away, the fundamental challenge of healthcare financing is apparent: if the cost of treating skin cancer is twice as much as what any single individual can pay in a year (even if they spent their income on healthcare and nothing else), then how can anyone afford to become healthy?
Let’s say the nation as a whole makes two assumptions at this point:
The cost of treating sickness cannot be significantly reduced from $1,000.
At any given time, 10 people in the nation will be sick (and this number cannot be reduced).
Under these two assumptions, the only solution is for the sick to use other people’s money to pay for treatment.
This is where the health insurance system comes in. Its existence is justified by the inability of a single individual to pay for the cost of treating his own illness. Instead, risk is pooled; that is, everyone pays into an insurance fund to which any of them can lay claim once they become sick. All 100 people in the nation have an incentive to obtain insurance because any one of them could become a member of the sick population at any time, without warning. Under a perfect insurance system, the cost of the treating the sick ($1,000 x 10 people, or $10,000) will at any given time be distributed among 90 healthy payers (only $111 per person, which can be paid out at a rate of $3/year per person for 37 years).
Because health insurance is a service like any other service in Example’s economy, people have a choice between different types of insurance, and can also choose to have no insurance at all. However, because they are given a choice to obtain insurance, it is only fair that insurance companies have the corresponding choice to accept or reject people from their pool to prevent abuse of the system (via certain prerequsites like the lack of a preexisting condition).
Let’s see if we can predict how costs will be shifted under this system.
First, let’s figure out what happens to the basic supply-demand model behind treating skin cancer. Now the people of Example no longer pay their doctors for their services. Rather, the people pay an intermediary--the insurance company--who then pays the doctors. The people of Example are, in other words, insulated from the potential cost of their care. What the sick population of Example sees on their bills is not $1,000 (the real cost), but installments of $3 (their insurance premium). As the real cost ($1,000) changes over time due to inflation or provider supply, the premium will not be able to adjust immediately. In time, it will no longer be perfectly representative of reality.
Now let’s reexamine the incentive for the healthy people to purchase insurance. Their onlyyou would fall in that 10% in your lifetime? Or maybe you feel that there are bigger and better things to pay for, like a flat screen television, or your child’s education. Or maybe all those different plans seem too complicated, and you can’t bother to buy something you don’t even understand. Or it just seems too expensive. Or whatever. incentive is that there is a possibility that they may contract skin cancer. But how likely is that? After all, only 10% of Example is sick at any time. As a citizen of Example, what are the chances that
So you decide to risk it. You don’t buy into the insurance pool, or you buy into it much later, such that you only pay $3/year for 10 years instead of the full 37. As a result, the cost for the remaining 89 individuals to buy into the pool increases marginally. This initiates the vicious cycle that's the bane of every insurance system ever conceived: you decide not to pay, so the cost of insurance increases. The cost of insurance increases, so other people decide not to pay. And so on, and so forth.
There is a solution for this problem that can compensate for Example’s insulation from healthcare costs and prevent the vicious cycle from beginning in the first place. The solution is obvious and fairly simple: mandate insurance. In this way, everyone buys into one insurance plan or another the moment they are born, and pays their dues until they get sick. If they aren't yet sick, then their contributions are used to treat those who are currently sick.
There is no denying that healthcare is subject to the same market forces as any other service. If this is the case, then we need to find a way to make the market function properly, such that supply and demand are matched through adequate competition or price negotiation. There are many, many ways to do this, but they all attempt to compensate for the consumer's insulation from the cost of care. This, I feel, is the fundamental problem in healthcare financing, and the best solution (whatever it is) will address this first, rather than point to a specific cause (technology, administrative inefficiency, etc.).
It's All About the Money
I think it would be difficult to identify a single defining factor which could account for the increase in spending on healthcare, but some possible/obvious candidates could be the increased cost of healthcare (technology etc), increased burden of disease (i.e. higher rates of "expensive" diseases), highly inefficient care, lack of prevention, and the extremely complex system through which medical care is paid for.
As is the case with the problem, the solution would be multifactorial, however a start could be the reduction in bureacracy by simplifying the healthcare system and implementing a single-payer system (or a national health service?) to make everything run a bit more smoothly while at the same time providing coverage to as many people as possible. Other steps could be to reduce hospital spending by increasing outpatient care and reducing the number of inpatients admitted. Of course, increasing health-awareness and prevention measures could potentially be the biggest factor in reducing money spent on healthcare, as a vast portion of today's major health conditions are "preventable."
As is the case with the problem, the solution would be multifactorial, however a start could be the reduction in bureacracy by simplifying the healthcare system and implementing a single-payer system (or a national health service?) to make everything run a bit more smoothly while at the same time providing coverage to as many people as possible. Other steps could be to reduce hospital spending by increasing outpatient care and reducing the number of inpatients admitted. Of course, increasing health-awareness and prevention measures could potentially be the biggest factor in reducing money spent on healthcare, as a vast portion of today's major health conditions are "preventable."
Saturday, January 24, 2009
It's All About the Money $$
Health care spending has been on the rise for numerous reasons. There are 40 million uninsured individuals in the United States. Whenever these individuals need medical attention, they go to the emergency room. When ERs are unable to pay their bills, the hospital must somehow make up for this loss. In turn, they raise the prices of medical services. This directly contributes to the rising cost of health care. It’s like a vicious cycle, those without insurance are running up the costs for others, but they don’t have insurance because it is so unaffordable. Rising costs can also be attributed to the cost of paying the administrative staff of insurance companies. The U.S. requires more administrative staff for payment reimbursement than any other country. Health care in the U.S. is already so high and with these tough economic times, it is only getting worse. More people are becoming unemployed and losing health benefits. Prices of services will increase as more services are utilized without payment. Universal healthcare could be an option. Everyone would have some sort of insurance and we would all pay for it. The only thing being cut out would be the insurance companies. A “single-payer” system might be beneficial. The government would collect all health care fees, and pay for all health care costs. Currently, there are thousands of different health care organizations (billing agencies). In a single-payer system, all hospitals, doctors, and other health care providers would bill one entity for their services. As a result, everyone saves money and health care can become more affordable for those who don’t have it.
Demystifying U.S. Health Care Spending?
According to one report from McKinsey Global Institute in 2007, prices, efficiency and insurance administration are the most important reasons U.S. spending is higher than spending in other countries in Health Care. The study estimated that relative to OECD countries, the U.S. pays 70 percent higher prices for drugs, has substantial excess capacity and low productivity in outpatient facilities, and spends six times more on insurance administration.
We can save vast sums of money (recent est. up to $350 billion) by ridding ourselves of the needless middlemen profiteers of the private fragmented health insurance industry. More than enough to cover the current 45 million uninsured.
Here is another interesting report. Dr Paul B. Ginsburg, President of the Center for Studying Health System Change, authored a new report in October 2008; "High and Rising Health Care Costs: Demystifying U.S. Health Care Spending."
The report is part of the Robert Wood Johnson Foundation's Synthesis Project. Three major drivers of health care spending, according to the findings of the study are:
• Technology—not demographics or medical malpractice—is the key driver of health spending, accounting for 38 percent to more than 65 percent of spending growth.
• Other important drivers of health care spending include health status (particularly obesity) accounting for an estimated 12 percent of the health care spending growth and
• Low productivity gains in the health care sector due to extensive third-party payment and to payment policies that reward more units of service rather than efficient care for an episode of illness.
One interesting comment from that report is that "If the efficiency of the delivery of services could be increased by 20% over 10 years, this would roughly close the gap between health care spending and GDP over that period." The bottom line is that if we want to contain our health care costs we need to find productivity improvement in things like technology use, treatment patterns, and administrative overhead.
Today, most health care reform plans focus on things like expanding the number of the insured and wellness initiatives. Those are good objectives.
But, according to Synthesis Project report, covering more people will cost more not less. Improvements in lifestyle--particularly obesity and other chronic diseases--however, might help.
But, there is another interesting Federal Report, published in January-February issue 2009 of Health Affairs. It pointed out that health care spending in U.S. grew at lowest rate in a decade in 2007. But, consumers are still paying more for out-of-pocket expenses, reports say.
Based on those reports, it is imperative that the current health care system is needed to be changed. To combat inefficiencies in health care financing, I think, a single payer model would probably help with the large majority of our troubles in financing care for every citizen. It should be a publicly financed system similar to the way Medicare is funded by our taxes. It should still stay privately delivered with our current nationwide network of physicians and hospitals and ancillary staff etc.
I'm also in favor of allocating more health care expenditure on public health education and preventative intervention like everyone has suggested.
For details of the reports, please check the following websites.
http://health.usnews.com/articles/health/healthday/2009/01/06/health-care-spending-in-us-grew-at-lowest-rate-in.html
http://www.rwjf.org/pr/product.jsp?id=35368
We can save vast sums of money (recent est. up to $350 billion) by ridding ourselves of the needless middlemen profiteers of the private fragmented health insurance industry. More than enough to cover the current 45 million uninsured.
Here is another interesting report. Dr Paul B. Ginsburg, President of the Center for Studying Health System Change, authored a new report in October 2008; "High and Rising Health Care Costs: Demystifying U.S. Health Care Spending."
The report is part of the Robert Wood Johnson Foundation's Synthesis Project. Three major drivers of health care spending, according to the findings of the study are:
• Technology—not demographics or medical malpractice—is the key driver of health spending, accounting for 38 percent to more than 65 percent of spending growth.
• Other important drivers of health care spending include health status (particularly obesity) accounting for an estimated 12 percent of the health care spending growth and
• Low productivity gains in the health care sector due to extensive third-party payment and to payment policies that reward more units of service rather than efficient care for an episode of illness.
One interesting comment from that report is that "If the efficiency of the delivery of services could be increased by 20% over 10 years, this would roughly close the gap between health care spending and GDP over that period." The bottom line is that if we want to contain our health care costs we need to find productivity improvement in things like technology use, treatment patterns, and administrative overhead.
Today, most health care reform plans focus on things like expanding the number of the insured and wellness initiatives. Those are good objectives.
But, according to Synthesis Project report, covering more people will cost more not less. Improvements in lifestyle--particularly obesity and other chronic diseases--however, might help.
But, there is another interesting Federal Report, published in January-February issue 2009 of Health Affairs. It pointed out that health care spending in U.S. grew at lowest rate in a decade in 2007. But, consumers are still paying more for out-of-pocket expenses, reports say.
Based on those reports, it is imperative that the current health care system is needed to be changed. To combat inefficiencies in health care financing, I think, a single payer model would probably help with the large majority of our troubles in financing care for every citizen. It should be a publicly financed system similar to the way Medicare is funded by our taxes. It should still stay privately delivered with our current nationwide network of physicians and hospitals and ancillary staff etc.
I'm also in favor of allocating more health care expenditure on public health education and preventative intervention like everyone has suggested.
For details of the reports, please check the following websites.
http://health.usnews.com/articles/health/healthday/2009/01/06/health-care-spending-in-us-grew-at-lowest-rate-in.html
http://www.rwjf.org/pr/product.jsp?id=35368
If only money grew on trees...
Health care spending has historically been shielded from the effects of a declining economy for whatever reason, so in a recession as bad as the one we're experiencing now, it's really not a surprise that health care is taking up a huge chunk of the money pie.
One way to rein in the high spending might be to emphasize the use of generic medications instead of brand-name prescriptions. At least, that was the trend reported in 2007, which showed the smallest increase in health care spending since 1998, moving up only 0.2% from the previous year. I guess an emphasis on using electronic prescriptions would help keep costs down (the Brigham and Women's Hospital and HMS study projected that $845,000 could be saved each year for every 100,000 patients). This is called comparative effectiveness research, and a really interesting report was published by the Congressional Budget Office in late 2007 on exactly how such research (and implementation) could significantly reduce health care costs in the long term. A bill to establish a comparative effectiveness institution was proposed last April, and the initiative was listed as part of Obama's Plan for a Healthy America.
(Full CBO report here for those with lots of free time).
But, higher spending this time around seems to be coming from an increase in chronic conditions such as diabetes and high BP, as reported. Of course, prevention helps, but when you're already afflicted with chronic disease, there's really not much left to do but treat it...which means money spent on doctor vists, treatments, drugs, etc.
Regardless, I agree with Howard and Kate that more emphasis should be placed on preventative education to ensure that the high costs of medical treatment will be less pervasive in the future. In tough financial times, families have to make difficult choices, and usually the urgency to meet immediate needs--putting food on the table, keeping their homes--is given priority over something like a persistent cough that they'd wanted to get checked out.
In such situations, I believe it might be beneficial to increase the presence of nonprofit organizations who can provide basic medical and dental treatments, and give preventative health workshops (all free of cost). A workshop topic might be, for example, how to grow and maintain a vegetable garden, with the purpose of promoting healthy eating for families on a budget. However, due to the recession and the resulting difficulty in obtaining grants (or grants of any substance), nonprofit organizations are being forced to significantly reduce the scope and availability of their programs--which is where the feds could potentially step in and offer some help. Instead of bailing out the automobile industry with billions of dollars, they should have put a chunk of that money towards some of the aforementioned health care services.
One way to rein in the high spending might be to emphasize the use of generic medications instead of brand-name prescriptions. At least, that was the trend reported in 2007, which showed the smallest increase in health care spending since 1998, moving up only 0.2% from the previous year. I guess an emphasis on using electronic prescriptions would help keep costs down (the Brigham and Women's Hospital and HMS study projected that $845,000 could be saved each year for every 100,000 patients). This is called comparative effectiveness research, and a really interesting report was published by the Congressional Budget Office in late 2007 on exactly how such research (and implementation) could significantly reduce health care costs in the long term. A bill to establish a comparative effectiveness institution was proposed last April, and the initiative was listed as part of Obama's Plan for a Healthy America.
(Full CBO report here for those with lots of free time).
But, higher spending this time around seems to be coming from an increase in chronic conditions such as diabetes and high BP, as reported. Of course, prevention helps, but when you're already afflicted with chronic disease, there's really not much left to do but treat it...which means money spent on doctor vists, treatments, drugs, etc.
Regardless, I agree with Howard and Kate that more emphasis should be placed on preventative education to ensure that the high costs of medical treatment will be less pervasive in the future. In tough financial times, families have to make difficult choices, and usually the urgency to meet immediate needs--putting food on the table, keeping their homes--is given priority over something like a persistent cough that they'd wanted to get checked out.
In such situations, I believe it might be beneficial to increase the presence of nonprofit organizations who can provide basic medical and dental treatments, and give preventative health workshops (all free of cost). A workshop topic might be, for example, how to grow and maintain a vegetable garden, with the purpose of promoting healthy eating for families on a budget. However, due to the recession and the resulting difficulty in obtaining grants (or grants of any substance), nonprofit organizations are being forced to significantly reduce the scope and availability of their programs--which is where the feds could potentially step in and offer some help. Instead of bailing out the automobile industry with billions of dollars, they should have put a chunk of that money towards some of the aforementioned health care services.
It's easy to blame the continual rise in national health spending on inefficiencies and technology, etc. However, the fact of the matter is, how can healthcare spending per capita decrease when problems such as obesity, smoking, alcohol consumption, and drug abuse are on the rise?
At the same time, our economy is rapidly heading towards a depression. In this economic crisis, the number of insured patients is rapidly declining, leaving a huge void in primary care/preventative medicine. That, combined with the steady incline in chronic diseases such as diabetes, coronary artery disease, COPD, and heart failure etc., secondary to our sedentary lifestyle including things mentioned before (obesity, alcohol consumption, smoking) is obviating the need for health care spending to increase. Put simply, more people are sick and fewer people can afford insurance.
The solution to the problem is providing insurance to the uninsured so they may have a platform for preventative medicine and primary care. We also need to create an infrastructure that changes the philosophy of the importance of physical activity and eating healthy so that it is clearly understood by all. In addition, making health insurance more affordable will help avoid some of the shifts in costs that are affecting the people who are currently insured.
As long as we target the source of the problem, we have a chance to come up with solutions for it. If we try and look at secondary outcomes, we will never come up with an effective solution.
Friday, January 23, 2009
Preventative Services the Key to Lowering Costs?
According to the National Coalition of Health Care: “Experts agree that our health care system is riddled with inefficiencies, excessive administrative expenses, inflated prices, poor management, and inappropriate care, waste and fraud.” These problems get worse every year in the United States and this causes the continual increase in the price of health care.
If you go to this website: http://www.nchc.org/facts/cost.shtml, you can see how rising costs are affecting families:
1) National surveys show that the primary reason people are uninsured is the high cost of health insurance coverage.
2) About 1.5 million families lose their homes to foreclosure every year due to unaffordable medical costs.
One ideal option to control medical costs would be to offer more preventative services to all portions of the population. This is for the simple fact that performing heart surgery is much more expensive than having a health professional offer good dietary advice about making the heart healthier. In other words, much more government money should be allocated to preventing medical problems by educating the public on how to lead healthier lives.
If you go to this website: http://www.nchc.org/facts/cost.shtml, you can see how rising costs are affecting families:
1) National surveys show that the primary reason people are uninsured is the high cost of health insurance coverage.
2) About 1.5 million families lose their homes to foreclosure every year due to unaffordable medical costs.
One ideal option to control medical costs would be to offer more preventative services to all portions of the population. This is for the simple fact that performing heart surgery is much more expensive than having a health professional offer good dietary advice about making the heart healthier. In other words, much more government money should be allocated to preventing medical problems by educating the public on how to lead healthier lives.
Thursday, January 22, 2009
Interesting Article
Great job last week! Here's an interesting article in the New York Times published a few days ago regarding the growing need for Medicaid during our current recession. Medicaid currently consumes 7-8% of the federal budget and including the states' funding, the cost of the program was $333 billion in 2007, according to this article. President Obama is proposing an increase in federal aid to help state Medicaid programs.
http://www.timesdaily.com/article/20090122/ZNYT02/901223014?Title=Growing_Need_for_Medicaid_Strains_States
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