Overall Healthcare and Economics

¶ … Healthcare and Economics:

Health care costs have continued to increase in the past few decades despite of the numerous health reform initiatives. Currently, these expenditures account for more than 18% of GDP in the United States, a percentage that is expected to continue rising significantly. Actually, it's projected that the share will rise to 34% of GDP by 2040 if health care costs continue to increase at historical rates. The increased health care costs have considerable impacts on households, insurance companies, and government budgets. For instance, households with employer-financed health insurance will have a progressively minimal portion of their total compensation in the form of take-home pay. On the other hand, a progressively larger fraction of compensation will be in the form of employer-provided health insurance. Governments will be forced to cater for more than 50% of health care expenditures if they continue to increase at historical rates. Therefore, the current trends in health care economics continue to have significant impacts on households, health insurance companies, governments, and healthcare organization.

Current Trends in Health Care Economics:

As previously mentioned, one of the major trends in health care economics is the significant increased of health care expenditures or costs to an extent that it accounts for a huge share of the Gross Domestic Product. The dire implications of this trend is demonstrated in the fact that federal, state, and local governments are currently forced to cover nearly 50% of current health care spending ("The Economic Case for Health Care Reform," 2009). The increase in health care costs and its impact on government budgets is partly attributed to the failure by small firms to provide coverage despite of the huge number of people without health insurance.

The second trend in health care economics is medical innovation, which is the major driver of significant growth in health care spending. While an aging population, increased per-capita income, and expanded health coverage have played a crucial role in substantial growth of health care spending, medical innovation account for nearly 75% of this growth (Philipson, 2013). Third, many small employers and consumers are seemingly unable to afford their health insurance premiums. As a result, many small employers are incapable of providing health care coverage at all while firms with less than 10 workers can only provide coverage for half of their employees. Moreover, many people are experiencing tremendous difficulties in paying for health care while other consumers with coverage experienced a substantial increase in the share of health care coverage.

These current trends in health care economics have had significant impacts on healthcare organizations to an extent that they hinder the ability of the country to undertake other important initiatives required to deal with other valuable issues. One of the major impacts of these trends on healthcare organizations is their contributions to rising prices for care. Health care organizations have been forced to increase the costs of care services, especially for privately insured individuals. The increase in prices of care services has occurred in all major categories of health care i.e. surgical procedures, outpatient care, and hospital stays. Secondly, the trends have increased consolidation of the hospital industry as mergers and acquisitions of health care organizations have increased considerably. These mergers and acquisitions lead to hospital market concentration, which in turn increases the prices of care services ("The Facts About Rising Health Care Costs," n.d.).

The current political, social, and demographic trends have also affected the patient population and delivery of health care. From a political and social perspective, the main trend has revolved around health care reform initiatives that are geared towards ensuring the accessibility and affordability of care services. One of the major political and social trends is the implementation of Obamacare plan that has attracted considerable support and criticism in the past few years. The main demographic trend is the increase in numbers of elderly people who need increased medical care and attention. These trends have had significant impacts on the patient population by increasing the number of people in need of medical care. While health care reform initiatives have been adopted in increase accessibility and affordability of care services, they have contributed to the increase of the number of uninsured people. There has also been an increased in the aging population, which contributes to increase in health care spending. These trends have considerable effects on delivery of care by contributing to the need for more health coverage, the need for better care services, and increase in prices of care services.

Nursing Strategies for Cost-effective and Efficient Care:

In light of the impact of current health economics on delivery of care and the ever-increasing health care costs, it's increasingly important to develop cost-effective and efficient care. Nurses have adopted various strategies for cost-effective and efficient care, which is essential for success in the nursing field as resources allocated to health care continue to decline. One of the major nursing strategies towards ensuring cost-effective and efficient care by controlling costs is resource management. Generally, the largest costs of resources are attributed to personnel, supplies, equipment, and information technology.

Since the costs of each of these resources is easy to measure, resource management focuses on the use and costs of resources. This nursing strategy involves standardization of supplies and equipment, enhanced inventory management, and incorporating staff in the assessment of equipment and supplies (Harrington, 2011, p.46). It also involves customization of equipment and supplies for various provider costs. Resource management contributes to cost-effective and efficient care by increasing the ratio of registered nurses to patients, increasing use of unlicensed assistive personnel, and lessening inputs. Finances that are saved by lessening staff can be used to improve efficient care by eliminating costs resulting from lower quality care.

The second strategy is care management that focuses on costs that are directly linked to patient care. This strategy is based on the belief that resource management has restricted opportunities to significantly lessen costs. Therefore, it enables nurse leaders to focus on the main drivers of costs associated with actual care of patients. Care-based cost management is primarily based on practice variation, which is the largest target that affords the greatest opportunity for providing the highest quality, most cost-effective care.

CINAHL Systems Theory in the Healthcare Industry:

CINAHL Systems Theory is an important theory in the healthcare industry that can help the industry to operate more effectively. The Cumulative Index to Nursing and Allied Health Literature contributes to more effective operation of the healthcare industry by providing comprehensive coverage on issues related to nursing and other allied health disciplines. It provides a multidisciplinary scope and approach towards nursing, biomedicine, health sciences, consumer health, and 17 allied health disciplines. The information provided in the literature can be used to select appropriate standards for professional practice that contributes to improved operations.

Utilization Review on Health Care:

Utilization review occurs when a health care insurance company requests for an opportunity to review a request for medical treatment. The review is usually geared towards confirming that the health plan provides coverage for the individual's medical services. Utilization review plays a crucial role in health care by acting as a safeguard against inappropriate and unnecessary medical care (Spector, 2004). For providers, utilization review enables them to review patient care in terms of care quality, place of service, medical necessity, length of hospital stay, and suitability of decision-making. For payers, utilization review helps in lessening costs and determining the suitability of recommended treatment. For patients, the review helps them to determine whether the health plan offers enough coverage for the specific medical condition.