Experienced a Significant Increase in the Cost

¶ … experienced a significant increase in the cost of health care. In 2004, 16% of the Gross Domestic Product (GDP) was spent on health care. In 2010, President Obama signed the "Affordable Health Care for America Act (HR 3962)" that has been a topic of heated debate since discussions began decades ago. Health care funding and design has been a major issue for U.S.

Provide a discussion that demonstrates you have an understanding of the impact the cost of health care has on the economy. Be sure to discuss the Gross Domestic Product (GDP).

According to Forbes (2012), America does not have a debt problem; it has a healthcare one. The price of health care is eating up the economy.

Health care spending is growing to almost 1.5 times the rate of growth of its gross domestic product (i.e. The market value of all its goods and services within a certain time) and is already close to 20% of how much it earns.

The graph below shows how, if this pattern continues, healthcare costs will eat up U.S. GDP within the next three decades.

Source; U.S. Health Care Expenditure As A Percent of GDP; Data via bea.gov & cms.gov

The blue line indicates federal government's projection of health care spending. The red line projects the effect on U.S. GDP if trend were to continue the way it has for the next 20 years.

The problem is that this cost of healthcare may exact such as massive onus on U.S. Treasury that it will have little to no fiscal resources set aside for social security, defense, or any other critical national need. Taxes will rise sharply or the U.S. will have nil fiscal credit. (Forbes. (2012)).

Moreover, financial crises produce more recipients of healthcare benefits increasing the burden on the Government. Health care costs, for instance, were 20% of GDP before the recession. 20012 saw them rise to 24%. With the increase of needy recipients, and the increase in costs of healthcare technology as well as introduction of new technology and demand for this technology, healthcare costs are expected to grow. The U.S.A. is the hotbed of new technology and both hospitals and payers demand services for its use despite shrinking resource to pay for its usage. People want the "latest and the best" especially when insurance can be used to pay for this service. Hospitals compete for clients on the basis of this new technology. Legal risks and health plans also push hospitals to invest in this new technology. Technology is on the rise and parties such as Medicare are predicted to have an even harder time making ends meet to provide government insurance for those who need it.

In short, the cost of insurance keeps mounting making insurance even more intimidating for those who can barely afford it. Third party payers (such as Medicare and Medicaid) do little to hold down the costs, and new technology and prescription drugs as well as labor costs just increase it.

2. Health care legislation impacts an array of factors such as quality of health care, insurance coverage, the free market, etc. Select two to three (2-3) areas impacted by health care legislation such as HR 3962, and provide an argument in support of the health care act and two arguments that are in opposition to such a health care act.

Legislation such as HR 3962 intends to provide affordable care to all Americans. Results would be like that which Obamacare. signed in 2010, intends. These include the following three:

1. widened access to insurance where there will be less deaths and casualties due to all American citizens receiving at least the rudiments of medical treatments;

2. quality improvement in the services provided to those who can least afford it so that there is ideally little distinction between quality of medical service reduced to the rich and between that provided to the poor;

3. Financing long-term care for an increasing aging population. (Focus on Health Reform)

The advantages are obvious: it seems only fair that people who cannot afford insurance should be allowed access to something that is one of the basic rudiments of life: medical care. America touts itself as democracy. Democracy entails equal treatment to all regardless of socio-economic differences. All people, therefore, should be entitled to medical care regardless of whether or not they can afford it. Employers too should be made to contribute to employees' insurance as the HR 3962 recommends. Differences should be removed between vulnerable (in all sectors) and powerful. This is the spirit of a democracy; and this is the intent of the HR 3962.

On the other hand, opponents provide 15 reasons for opposing the HR 3962, obamacare, and similar legislation. Three of these include the following:

1. 1. Employer Mandate -- Employers are obligated to provide employee insurance. Unsustainable costs are, however, the primary issue facing small business and this mandate does not recognize that.

2. Payroll Tax Penalty -- The HR demands that all business with a payroll of $500,000 or more pay a payroll tax of up to 8% if they do not provide "qualified" health insurance to their employees. The business may, however, be unprofitable and unable to pay this tax.

3. Creates New and Expands Existing Government Programs

The HR, as other legislation, talks about diverting some of its fiscal burden to private sources (such as business and rising tax). At the same time, it aims to introduce and expand other health care programs. This only introduces a voracious cycle where more money will be needed, healthcare costs will rise, tax will rise, and the private individual will be increasingly pursued. (NFIB. online)

3. Compare the three (3) main types of health insurance in the U.S. And assess the solvency of each. Make a prediction regarding the longevity of each type over the next 30 years.

1. Medicare is designed for Americans age 65 and older but does not cover all costs, particularly long stay in a hospital or nursing care at home.

2. Medicaid is available to people with low incomes. These also include people who have reached a certain age, blind, disabled, and families who have dependent children. The problem is that there is difficulty in describing 'low income' and many people who do deserve it are not on it.

3. Children's health insurance program (chip) is for children no older than 19 years are eligible for cheap or even free medical insurance. CHIP covers visits to doctors, payments for drugs, hospital stay, etc. For example, a family consisting of four people and receive up to $34,000.00 per year is eligible for a subsidized insurance.

Other programs are the State Children's health Insurance Program intended to cover children without insurance as well s federally Qualified Health centers.

None of these, however, eradicate the problems inherent in these federal programs (especially Medicare and Medicaid) that not only have gaps in coverage, and fail to provide insurance to many who most need it but demonstrate spiraling costs and disproportionate attention to certain sectors of the population. (Squidoo.)

All three too have problems with waste, abuse, and fraud, and the future at least with heightened costs does not look good for Medicare or Medicaid. Studies show that patients on Medicaid have the worst health outcomes of any group in America. All three too pay their physicians little, have long waiting time, and invest in poor quality services. There result is an increase in casualties, mortality, and demonstration of very poor quality care. (Hood, 2010)

. Debate whether or not private health insurance violates the standard principles of insurance.

Private health insurance certainly violates the standard principles of insurance. Insurance comes through 4 quarters: (1) those that have it form employers (2) those that are able to afford it independently (3) those who can afford it form private funds (4) those that get it from a government health program.

Ideally, medical insurance is supposed to provide the same level of care to all regardless of socio-economic class. However, problems such as Medicare experience waste, abuse and corruption with their money and end up paying their doctors little, investing minimal in technology, and providing poor care on all counts.

Studies show that patients on Medicaid have the worst health outcomes of any group in America -- worse than those on private insurance, and sometimes worse that those with no insurance at all. These studies show that:

Medicaid patients were almost twice as likely to die as those with private insurance; their hospital stays were 42% longer and cost 26% more. Compared with those without health insurance, Medicaid patients were 13% more likely to die, stayed in the hospital for 50% longer, and cost 20% more. (Manhattan Institute (2012))

The health care system is still largely fee for system i.e. people pay for quality services. Problems with the FFS are numerous including the fact that there is discrimination in health delivery with a great swaths of the population receiving inadequate or utter lack of care and with service being questionable and of limited value.

Another difference between private insurance and government insurance is that the cost of insurance keeps mounting making insurance even more intimidating for those who can barely afford it. Third party payers (such as Medicare and Medicaid) do little to hold down the costs, and new technology and prescription drugs as well as labor costs just increase it.

Private insurance too focuses more readily on prevention than doe's public insurance (such as Medicaid) which focuses on sickness and therefore has less of a salutary effect.

4. Analyze the evolution of the promotion of health and disease prevention in the U.S. And identify the point at which a clear shift in the thinking in the dominant culture occurred resulting in the greatest impact on the health care insurance system in the U.S.

Health promotion as a whole is defined as the best way to promote health of the patient, be that by preventing disease from occurring, by impeding the illness in its beginning stages, or by reducing pain and helping the patient feel comfortable.

Critics contend that the government is spending too much one health care costs. America, they say, should focus more on prevention rather than treatment, of consumer-driven health plans, and of greater reliance on alternative treatment. Greater onus, conservatives, says should be placed on individual responsibility. To that end, the U.S. Preventive Services Task Force (USPSTF/Task Force) was established in 1984 and since then the healthcare environment in the U.S. has shifted to greater emphasis on prevention rather than on illness. Delivery of clinical preventive services such as immunizations, mammograms, and cholesterol screening has become more common over the last two decades, whilst 90% of employers have to include well-child visits, childhood immunizations, screening tests, and adult physical examinations among covered health benefits compare to less than half of those who did so before 1988. Also too health plans and clinicians are being held more accountable for the quality of their preventative care. (Woolf SH and Atkins D. 2001).