Health Care Costs

Topics: Health insurance, Managed care, Medicine Pages: 4 (1184 words) Published: January 29, 2011
Health Care Costs
Health care costs have become a major issue in the United States, both socially and politically. According to the U.S. Census Bureau, 50.7 million people, or nearly one in six U.S. residents, were uninsured in 2009 (Kaiser Health News, 2010).This is because the high cost of health care has driven the cost of insurance out of the reach of many Americans. Contributing factors to the continuing increase in the cost of health care are the generally unhealthy lifestyle practiced by many Americans (obesity, smoking, etc.) and the advances in medical technology. Insurance companies have sought ways to keep the cost of health care down by offering incentives to insured persons to live healthier lifestyles and use less coverage, and by making discount arrangements with providers. The government has tried to make health care more accessible and affordable through the Social Security Amendments of 1983, the Health Insurance Portability and Accountability Act of 1996 and the current Patient Protection and Affordable Care Act.

Historical Trends in Financing Health Care
Modern health insurance traces its beginnings to the 1920s when hospitals began providing pre-paid plans for hospitalization days to individuals and groups. These hospitals joined with the help of the American Hospital Association under the name of Blue Cross. Physicians then began to provide their own pre-paid plans under the name of Blue Shield (randomhistory.com 2009). As the market for health care coverage grew, the government encouraged participation in employer-employee benefit plans, which were often backed by strong labor unions. In 1954, the Internal Revenue Code exempted employer and employee contributions to these plans (Thomasson 2003). In 1965 the government entered the health care arena as a third-party payer with the signing by President Lyndon B. Johnson of the Social Security Act Amendments. These amendments created Medicare, a health insurance program for the...
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