Portia Green

September 24, 2014

Assess the Effectiveness of the U.S. Health Care System

I think that the reason that there is a paradoxical achievement of the U.S. Health System in terms of money spent per capita is because of the trillions of dollars being spent on healthcare and the fact that even though the government has spent a lot on healthcare, some Americans are still uninsured. The United States spends approximately $1.7 trillion dollars on health care each year and on average about 57,000 per year on each American citizen (Almgren, G. 2007). Even though there are no reasons that have been proven as to why there is a paradoxical achievement in the U.S. Health System when it comes money spent per capita, there are some contributing factors. Some of those factors include: hardship, racism, and rate of increase of wage disparities which signifies that some elements of health care affordability will impact accessibility of health care services (Almgren, G. 2007). The biggest factors is what the U.S. is paying for health care, and the fact that the U.S. has still been unsuccessful in making sure that all Americans are insured.

RISING HEALTH CARE COST

As I stated earlier one of the factors that contributes to why there is an underachievement in the U.S. health care system when it comes to money spent per capita is because of money

spent on quality health care. Currently, health care spending has rose to its 10th year high (Davidson, P, 2014). Cost for health care rose at a 5.6% in the fourth quarter according to the Bureau of Economic Analysis (Davidson, P, 2014). During this increase of health care spending, there was a $ 8 billion dollar rise in hospital revenue alone (Davidson, P, 2014). That was more than the previous quarters all put together. These statistics show that there is a lot of money being put into health care, but the question is why are so many Americans without health insurance?

WHY ARE SOME AMERICANS NOT INSURED?

Another reason there is an underachievement in the U.S. health care system when in reference to money spent per capita is because the U.S. is spending so much money on health care, but there are still many Americans that are uninsured because they can't afford health care coverage. There are many reasons why some Americans can't afford health insurance but the primary reason is because some Americans simply can't afford it. Even with Obamacare now in play some Americans still feel as though health care is too expensive. Unemployment is a big factor into why some Americans don't have health insurance. Americans that are unemployed have a bigger risk of losing health insurances than those who are employed. Being unemployed is more harmful to health insurance status and probability of health insurance loss than not being in the labor force (Fairlie, R. W., London, R. A., 2009). Research shows also show that employees that work at smaller firms are less like to have health insurance coverage (Fairlie, R. W., London, R. A., 2009).

It is safe to say that the reason there is a paradoxical underachievement when it comes to the U.S. health care system in terms of money spent per capita, is because there is so much

money being put into health care despite the fact that so many U.S. citizens are still uninsured. The reason that so many Americans are still uninsured because many can't afford health insurance because of various reasons which include: income and unemployment.

HOW AND WHY OTHER COUNTRIES SPEND LESS PER CAPITA ON HEALTH CARE THAN U.S.

According to the Washing Post the health care system in the U.S. is uniquely inefficient (Bernstein, Jared. n.d). We spend a lot more on things from hospitals stays to MRIs, to prescriptions, and to end of life care more than other countries (Bernstein, Jared. n.d). Part of the reason for this is that private-sectors spending makes up a huge part of health spending in the U.S. than it does in more advanced economies (Bernstein, Jared. n.d).

The U.S. does utilize more health care and does not have better outcomes than more advanced countries, countries that spend less per capita than we do on health care (Bernstein, Jared. n.d). The reason why other countries spend less per capita than we do on health care is because our care is more extensive than those in other countries (Bernstein, Jared. n.d). Administrative costs make up for a quarter of the U.S. health spending, twice more than other advanced countries (Bernstein, Jared. n.d). This reason has a lot to do with the many insurers, plan and health care providers that we have all fighting to get what they think they deserve against an already large industry fighting for the same thing (Bernstein, Jared. n.d).

We see from the chart that the U.S. does spend more per capita when it comes to health care more than any other country. Health care costs are steadily increasing and don’t seem to be declining anytime soon. The question then becomes why is the U.S. spending so much on health care?

A lot of the growth on health care spending in the U.S. for the past twenty years has been connected with population risk factors such as obesity and stress (Thrope, K., E., 2004). Rising disease and new advanced medical treatments account for nearly two-thirds of the rise in spending (Thrope, K., E., 2004). Then the next question becomes what approaches/decisions should be made by the U.S. in order to slow down growing health care cost.

Here below is a chart that shows how much other countries spend per capita on health care compared to the U.S. (http://pgpf.org/Chart-Archive/0006_health-care-oecd). As you can

see by the chart, the U.S. spends 1000 plus more dollars on health care per capita than any other country, which is a lot.

Some economists feel that there are only two approaches to lowering health care costs (Thrope, K., E., 2004). Those approaches are to lower spending on high-cost medical care that produces no benefits, and lower spending on high-cost care that have some health benefits but at even higher costs (Thrope, K., E., 2004). These approaches seem to be great approaches that could really benefit consumers as well as health-care providers.

In conclusion, the reason there is a paradoxical underachievement of the U.S. health system is in terms of money spent per capita is because of the trillions of dollars being spent on healthcare and the fact that even though the government has spent a lot on healthcare, some Americans are still uninsured. The reason that the U.S. is spending more per capita on health care than other countries is because of the extensive care we have here in the U.S. With all things being considered, I feel as though eventually all these concerns/issues with our U.S. health care system will eventually resolved.

References

Davidson, Paul. (2004, April). Health Care Spending Hits 10-year High. Retrieved from http://www.usatoday.com/story/money/business/2014/03/30/health-care-spending/7007987/

Peter G. Peterson Foundation (2014, June). Per Capita HealthCare Costs. Retrieved from http://pgpf.org/Chart-Archive/0006_health-care-oecd.

Bernstein, Jared. (2014, September). The Chart that Shows not just how, but why other countries spend less on health than we do. Retrieved from http://www.washingtonpost.com/posteverything/wp/2014/09/08/the-chart-that-shows-not-just-how-but-why-other-countries-spend-less-on-health-care-than-we-do/

Thorpe, K., E. (2005). The Rise In Health Spending and what to do about it. Health Affairs, 24(6), pg1436-1445.

Fairlie, R., W., London, R., A., (2009). Who is at Risk of Losing and Gaining Health Insrance? Industrial Relations, 48(2), Pg287-310