Health Care Spending
Health Care Spending
HCS/440 Economics: The Financing of Health Care
Today, health care costs are rising significantly faster than the national income. Kellerman (2012) states, “The U.S. spends far more on health care per capita and as a percentage of GDP than any other nation on earth, according to the Organization for Economic Cooperation and Development” (para. 3). Furthermore, health care spending has become a paramount issue that is overshadowing other important affairs, such as education. The level of current national health expenditures, why spending is too much, evaluation of where the nation should cut or add spending, examination of financing of health care, and a forecast of future economic needs of the health care system will be explored.
Level of Current National Health Care Expenditures National health care spending has significantly impacted the economy; however, overall growth has remained slow and steady at 17.9% of the gross domestic product since 2009 (Hartman, 2013). Over the last decade, changes in the economy affected the growth in health spending. For example, from 2004 to 2008, national health spending growth per capita was at 5.1 %; whereas, from 2009 to 2010, the growth decreased to 3.1% (Hartman, 2013). The slower growth is attributed to the decline in intensity and use of health services because of insurance coverage losses, declines in insurance enrollment, and declines in investments of equipment and structures (Hartman, 2010). Funding for health care in the United States is derived from three major sources: individual payers, private health insurance, and government-run programs. In 2007, individuals paid 11%, private health insurance paid 35%, government programs, such as Medicare and Medicaid paid 47%, and other private payers paid 7% (Getzen, 2007). Unlike, nearly a century ago, the majority source of financing health care shifted from individual payers to third-party payers, including corporate, private, and
HCS/440 Economics: The Financing of Health Care
Today, health care costs are rising significantly faster than the national income. Kellerman (2012) states, “The U.S. spends far more on health care per capita and as a percentage of GDP than any other nation on earth, according to the Organization for Economic Cooperation and Development” (para. 3). Furthermore, health care spending has become a paramount issue that is overshadowing other important affairs, such as education. The level of current national health expenditures, why spending is too much, evaluation of where the nation should cut or add spending, examination of financing of health care, and a forecast of future economic needs of the health care system will be explored.
Level of Current National Health Care Expenditures National health care spending has significantly impacted the economy; however, overall growth has remained slow and steady at 17.9% of the gross domestic product since 2009 (Hartman, 2013). Over the last decade, changes in the economy affected the growth in health spending. For example, from 2004 to 2008, national health spending growth per capita was at 5.1 %; whereas, from 2009 to 2010, the growth decreased to 3.1% (Hartman, 2013). The slower growth is attributed to the decline in intensity and use of health services because of insurance coverage losses, declines in insurance enrollment, and declines in investments of equipment and structures (Hartman, 2010). Funding for health care in the United States is derived from three major sources: individual payers, private health insurance, and government-run programs. In 2007, individuals paid 11%, private health insurance paid 35%, government programs, such as Medicare and Medicaid paid 47%, and other private payers paid 7% (Getzen, 2007). Unlike, nearly a century ago, the majority source of financing health care shifted from individual payers to third-party payers, including corporate, private, and