CONTROLLING HEALTH CARE COSTS IN THE U.S (Research Paper Sample)

HEALTH AND MEDICINE Name Course code Instructor Institution City/State Date CONTROLLING HEALTH CARE COSTS IN THE U.S * Overview statement of the issue. In the recent past, the growth rate of expenditure in the health care services in US has risen significantly. This rate has even risen above the Gross Domestic Product of the USA, Inflation and the general population in the country. This has raised the health expenditure from 3.6% to 6.5% from 1960s to 1990s consecutively. In 2005, the health care expenditures escalated to about $2 trillion which represents $6697 per capita in the US CITATION Sho14 \l 1033 (Bishob, 2014). This shows that 16% of the US GDP was actually accumulated by the health costs. The rise of health care spending is projected to continue increasing significantly. It is expected to reach about $4 trillion which is 23% of the US GDP by the year 2020.This means that when there is no control of the cost in the US, there will be a significant rise in the health cost which will bur many of the people from receiving the health care. If this rate is not controlled in the US, then it will grow faster than the inflation rates which can become disastrous to the economy CITATION Lau16 \l 1033 (Lorenzetti, 2016). The US has been known across the world to be spending more of the costs on the health care. Ordinarily, 17% entailed in the economy of the nation has been channeled to the health care which is higher than Netherlands by about 50%. Netherlands has been considered to be the second in terms of high health expenditures CITATION Sho14 \l 1033 (Bishob, 2014). Despite the high level of expenditure in the health care, the outcome of the US health has remained worse as compared to other advanced nations outcomes. Furthermore, there is sufficient evidence that their inefficiency and waste of resources. There is also variation of the prices of medicine, drugs, services and other pharmaceuticals in the US. The rise in price of the health care by the various stakeholders has made the costs of treatment to be high and this has remained a problem in the country. This high level of the spending in the US has remained detrimental to the success of the business, household budgets and the government. This leads to unfunded debts and liabilities that divert the resources from the job investment, education and other social needs. There is therefore the need to control the cost in the US since this will not only spur the affordability of the health care but will also ensure that there is quality health care in the US CITATION Ama16 \l 1033 (Trivedi, 2016). However, the costs can be controlled by the government. This takes seeks to analyze the health cost control strategies, the significance of control and the implication of the problem in the US. In a nut shell, there is need to control the expenditure of the staff which normally causes the health services to be high. Secondly, the cost of medicine should be reduced to make it accessible. Lastly there is need for proper education on preventive measures of the diseases which has been considered cheaper. The strategies will help with solving the issue and ensuring that the cost of health remains low CITATION Ama16 \l 1033 (Trivedi, 2016). * Significance of cost control The issue of health care cost control is vital for the development of the US economy in the upcoming years. Failure to control may mean that the economy of the US may reduce. Fundamentally, the issue of cost control is vital because it will not only boost economy but will ensure that there is fairness in the market. As it can be seen from the graph 1the health cost expenditure has been considered as the primary driver of major debts in the US. This implies that over 16% of the state expenditure is used in health leaving other departments constrained. In fact, social security and defense departments have been receiving very little funds over the years because of huge health expenditure CITATION Zek16 \l 1033 (Emanuel, 2016). This makes the governments to borrow money so as to balance the government exchequer leading to huge state debts. This leads to over budget and constrained public resources. This will may cause a general reduction in government expenditure which might translate to lack of employment. The state of joblessness will cause the youth to get involved in crimes so as to get a source of live hood. Therefore, the level of crimes may rise after some time. Graph 1: CITATION Mar142 \l 1033 (Gregor, 2014) The graphs also reveals that the health care cost per capital have also been increasing due to lack of effective control of the cost. This cause many people to spend more on health and thus fail to save. The lack of employment is caused due to increment in the cost of services. Though, the traditional economy model claims that the increase of care costs can not reduce the level of employment levels, this is not true because the employees are often motivated by good pay. Reduction of pay may cause lack of motivation among them and this may cause them to quite the jobs CITATION Mar142 \l 1033 (Gregor, 2014). * Implications of health cost control. The control of health costs in the US has been trivialized in the recent past and this has led to more losses than benefits. Lack of control of the costs by the government implies that there will be various effects. Firstly, the rise of health care cost will cause many of the people in the US not to take insurance policy. This means that most of the insurance companies will not get contracts and this will reduce the profitability of the companies. This will intern affect the economy of the nations in the long run. The scenario will also cause the local, federal or the state government costs to increase. The government has foreseen this has visualized the effects of the not controlling the costs and thus has tried to reduce the reimbursement to the providers, increase sharing costs of the patients and reducing the eligibility of public insurance. For example, close to 8 states were able to restrict the Medicaid eligibility and other benefits accrued in 2005.Though this was able to slightly reduce the cost of expenditure by 2%,there is need to do enough research to ascertain the steadfast rise in the health cost over the years CITATION Mar142 \l 1033 (Gregor, 2014). Lack of control of the health cost will lead to fluctuations in medical health prices that may bring exploitation. The exploitation arises when a company with malicious intension may want to monopolize other companies through reduced costs. The company can choose to offer the lowest cost in the market with a sole reason of making other pharmaceuticals companies suffer and leave the market. This could intern lead to further rise of the costs of care because the demand of the health services will be high. The control of the cost is important because it will enable solve this issue. In addition, when there are no control measures to the cost of health, the mortality rate will tend to increase. This is because many of the citizens in the US will not be in a position to acquire the health services. The increased costs in the hospitals will cause the insurance companies to raise their premium amount making it unaffordable for most of the people CITATION Lau16 \l 1033 (Lorenzetti, 2016). The increasing care costs have greater negative effects on the employment and the general output of the US industries. The rise of health care cost will cause the state of unemployment to increase in the long run. This is because the wages of the employees will be reduced to take care of the health costs. Though the insurance company will be in a better place to make profits; most of the people will not bear with this low income. This means that the employees will lack the motivation to do the jobs in most of the companies. This will intern lead to low efficiency in the companies which will cause low profitability. There is therefore the need for the government and other stakeholder in the health department to control the costs of health before the situation turns uncontrollable CITATION Ama16 \l 1033 (Trivedi, 2016). * Literature review of the issue. US have been trying to control cost of health over the years but this has not reduced the cost of health. The federal state has been using the traditional economic model which asserts that moderate prices in the hospitals are important to ensure that enough revenue in hospital. However, the term moderate has been wrongly defined and this has led to overcharging of the health services. This has caused various problems in the US such as reduced GDP CITATION Sho14 \l 1033 (Bishob, 2014). The high cost of health has made individuals to pay high premiums and thereby using a lot of their income in health related issue. This means that their income is reduced which intern reduced their per capita incomes. The reduced income led to reduced gross domestic income and this reduces the economy. Secondly, the rise of consumer income in the recent past has caused the purchasing power to increase. This makes people to seek better medical services which have higher payment. Most people have perceived that better care is usually accompanied by higher payment which is not always the case CITATION Zek16 \l 1033 (Emanuel, 2016). Lack of control of the costs will have effect not only to the economy but also to the employees. * Government. High costs of health cause the government to be indebted. The high costs of health services have made it impossible for the poor to access quality health. This has because the federal government to intervene causing it to overspend on health. The economic theory asserts that this arises because of income difference. The rich prefer to pay more for quality services. Since it has become...