What is the role of the United States government in regards to the delivery access and provision of health care services?
PDF Available Here The U.S. health care system is unique among advanced industrialized countries. The U.S. does not have a uniform health system, has no universal health care coverage, and only recently enacted legislation mandating healthcare coverage for almost everyone. Rather than operating a national health service, a single-payer national health insurance system, or a multi-payer universal health insurance fund, the U.S. health care system can best be described as
a hybrid system. In 2014, 48 percent of U.S. health care spending came from private funds, with 28 percent coming from households and 20 percent coming from private businesses. The federal government accounted for 28 percent of spending while state and local governments accounted for 17 percent.[1] Most health care, even if publicly
financed, is delivered privately. In 2014, 283.2 million people in the U.S., 89.6 percent of the U.S. population had some type of health insurance, with 66 percent of workers covered by a private health insurance plan. Among the insured, 115.4 million people, 36.5 percent of the population, received coverage through the U.S. government in 2014 through Medicare (50.5 million), Medicaid (61.65 million), and/or Veterans Administration or other military care (14.14 million) (people may be
covered by more than one government plan). In 2014, nearly 32.9 million people in the U.S. had no health insurance.[2] This fact sheet will compare the U.S. health care system to other advanced industrialized nations, with a focus on the problems of high health care costs and disparities in insurance coverage in the U.S. It will then
outline some common methods used in other countries to lower health care costs, examine the German health care system as a model for non-centralized universal care, and put the quality of U.S. health care in an international context. In Comparison to Other OECD Countries The Organization for Economic Co-operation and Development (OECD) is an international forum committed to global development that brings together 34 member countries to compare and
discuss government policy in order to “promote policies that will improve the economic and social well-being of people around the world.”[3] The OECD countries are generally advanced or emerging economies. Of the member states, the U.S. and Mexican governments play the smallest role in overall financing of health
care.[4] However, public (i.e. government) spending on health care per capita in the U.S. is greater than all other OECD countries, except Norway and the Netherlands.[5] This
seeming anomaly is attributable, in part, to the high cost of health care in the U.S. Indeed, the U.S. spends considerably more on health care than any other OECD country. The OECD found that in 2013, the U.S. spent $8,713 per person or 16.4 percent of its GDP on health care—far higher than the OECD average of 8.9 percent per
person.[6] Following the U.S. were the Netherlands, which allocated 11.1 percent of its GDP, then Switzerland also at 11.1 percent, and Sweden, which allocated 11 percent of its GDP to health care in 2013. In North America, Canada and Mexico spent respectively 10.2 percent and 6.2 percent of their GDP on health care. On a per
capita basis, the U.S. spends more than double the $3,453 average of all OECD countries (see chart[7] below).[8] Health Expenditure per capita, 2013 (or nearest
year) Drivers of Health Care Spending in the U.S. Prohibitively high cost is the primary reason Americans give for problems accessing health care. Americans with below-average incomes are much more likely than their counterparts in other countries to report not: visiting a physician when sick; getting a recommended test, treatment, or follow-up care; filling a prescription; and seeing a dentist.[9] Fifty-nine percent of physicians in the U.S. acknowledge their patients have difficulty paying for care.[10] In 2013, 31 percent of uninsured adults reported not getting or delaying medical care because of cost, compared to five percent of privately insured adults and 27 percent of those on public insurance, including Medicaid/CHIP and Medicare.[11] While there is no agreement as to the single cause of rising U.S. health care costs, experts have identified three contributing factors. The first is the cost of new technologies and prescription drugs. Some analysts have argued “that the availability of more expensive, state-of-the-art medical technologies and drugs fuels health care spending for development costs and because they generate demand for more intense, costly services even if they are not necessarily cost-effective.”[12]In 2013, the U.S. spent $1,026 per capita on pharmaceuticals and other non-durable medical care, more than double the OECD average of $515.[13] Another explanation for increased costs is the rise of chronic diseases, including obesity. Nationally, health care costs for chronic diseases contribute huge proportions to health care costs, particularly during end of life care. “Patients with chronic illness in their last two years of life account for about 32% of total Medicare spending, much of it going toward physician and hospital fees associated with repeated hospitalizations.”[14] The National Academy of Sciences found that among other high-income nations the U.S. has a higher rate of chronic illness and a lower overall life expectancy. Their findings suggest that this holds true even when controlling for socio-economic disparity.[15] Experts are focusing more on preventative care in an effort to improve health and reduce the financial burdens associated with chronic disease.[16] One provision of the Patient Protection and Affordable Care Act, commonly referred to as simply the Affordable Care Act (ACA), implemented in 2013, provides additional Medicaid funding for states providing low cost access to preventative care.[17] Finally, high administrative costs are a contributing factor to the inflated costs of U.S. health care. The U.S. leads all other industrialized countries in the share of national health care expenditures devoted to insurance administration. It is difficult to determine the exact differences between public and private administrative costs, in part because the definition of “administrative” varies widely. Further, the government outsources some of its administrative needs to private firms.[18] What is clear is that larger firms spend a smaller percentage of their total expenditures on administration, and nationwide estimates suggest that as much as half of the $361 billion spent annually on administrative costs is wasteful.[19] In January 2013, a national pilot program implemented under the ACA began. The aim is to improve administrative efficiency by allowing doctors and hospitals to bundle billing for an episode of care rather than the current ad hoc method.[20] Health Insurance in the U.S.: Uneven Coverage While the majority of U.S. citizens have health insurance, premiums are rising and the quality of the insurance policies is falling. Average annual premiums for family coverage increased 11 percent between 1999 and 2005, but have since leveled off to increase five percent per year between 2005 and 2015.[21] Deductibles are rising even faster. Between 2010 and 2015, single coverage deductibles have risen 67 percent.[22] These figures outpace both inflation and workers’ earnings. The lack of health insurance coverage has a profound impact on the U.S. economy. The Center for American Progress estimated in 2009 that the lack of health insurance in the U.S. cost society between $124 billion and $248 billion per year. While the low end of the estimate represents just the cost of the shorter lifespans of those without insurance, the high end represents both the cost of shortened lifespans and the loss of productivity due to the reduced health of the uninsured.[23] Health insurance coverage is uneven and often minorities and the poor are underserved. Forty million workers, nearly two out of every five, do not have access to paid sick leave. Experts suggest that the economic pressure to go to work even when sick can prolong pandemics, reduce productivity, and drive up health care costs.[24]
Rising Healthcare Premiums Health insurance premiums in the U.S. are rising fast. From 2005 to 2015, average annual health insurance premiums for family coverage increased 61 percent, while worker contributions to those plans increased 83 percent in the same period. This rate of increase outpaces both inflation and increases in workers’ wages.[41]
The Union Difference: Union workers are more likely than their nonunion counterparts to be covered by health insurance and paid sick leave. In March 2015, 95 percent of union members in the civilian workforce had access to medical care benefits, compared with only 68 percent of nonunion members. In 2015, 85 percent of union members in the civilian workforce had access to paid sick leave compared to 62 percent of nonunion workers.[44] At the median, private-sector unionized workers pay 38 percent less for family coverage than private-sector nonunionized workers, according to a 2009 study.[45] Across states, there are significant disparities in both the availability and the cost of health care coverage.
High Costs Drive Americans into Bankruptcy Universal coverage, in countries like the United Kingdom, Switzerland, Japan, and Germany makes the number of bankruptcies related to medical expenses negligible.[49] Conversely, a 2014 survey of bankruptcies filed between 2005 and 2013 found that medical bills are the single largest cause of consumer bankruptcy, with between 18 percent and 25 percent of cases directly prompted by medical debt.[50] Another survey found that in 2013, 56 million Americans under the age of 65 had trouble paying medical bills.[51] Another 10 million will face medical bills they are unable to pay despite having year-round insurance.[52] It has been suggested, based on the experience of Massachusetts, where medical-related bankruptcies declined sharply after the state enacted its health reform law in 2006, that the ACA may help reduce such bankruptcies in the future.[53] The Affordable Care Act: Successes and Remaining Challenges In March, 2010, President Obama signed the ACA into law that made hundreds of significant changes to the U.S. healthcare system between 2011 and 2014. Provisions included in the ACA are intended to expand access to healthcare coverage, increase consumer protections, emphasizes prevention and wellness, and promote evidence- based treatment and administrative efficiency in an attempt to curb rising healthcare costs.
Common Methods to Lower Health Care Costs By taking an international perspective and looking to other advanced industrialized countries with nearly full coverage, much can be learned. While methods range widely, other OECD countries generally have more effective and equitable health care systems that control health care costs and protect vulnerable segments of the population from falling through the cracks. Among the OECD countries and other advanced industrialized countries, there are three main types of health insurance programs:
A universal mandate for health care coverage defines these systems. Such a mandate eliminates the issue of paying the higher costs of the uninsured, especially for emergency services due to lack of preventative care.[67] Other methods for reducing costs may include:
An International Case Study: How Germany Pays for Health Care Germany has one of the most successful health care systems in the world in terms of quality and cost. Some 240 insurance providers collectively make up its public option. Together, these non-profit “sickness funds” cover 90 percent of Germans, with the majority of the remaining 10 percent, generally higher income Germans, opting to pay for private health insurance. The average per-capita health care costs for this system are less than half of the cost in the U.S. The details of the system are instructive, as Germany does not rely on a centralized, Medicare-like health insurance plan, but rather relies on private, non-profit, or for-profit insurers that are tightly regulated to work toward socially desired ends—an option that might have more traction in the U.S. political environment.[70]
Quality of U.S. Health Care in an International Context U.S. health care specialists are among the best in the world. However, treatment in the U.S. is inequitable, overspecialized, and neglects primary and preventative care.[77] The end result of the U.S. approach to health care is poorer health in comparison to other advanced industrialized nations. According to the Commonwealth Fund Commission, in a 2014 comparison with Australia, Canada, France, Germany, the Netherlands, New Zealand, Norway, Sweden, Switzerland, the U.K., the U.S. ranked last overall. In terms of quality of care, the U.S. ranked fifth, but came in last place in efficiency, equity, and healthiness of citizens’ lives.[78]Comparing other health care indicators in an international context underscores the dysfunction of the U.S. health care system.
Related reading: August 2016 [1] “National Health Expenditures 2014 Highlights” Center for Medicare and Medicaid Services. Available at: https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nationalhealthaccountshistorical.html What are the roles of government in ensuring good health delivery?Examples of proposed federal actions to reduce medical errors and enhance patient safety are provided to illustrate the 10 roles: (1) purchase health care, (2) provide health care, (3) ensure access to quality care for vulnerable populations, (4) regulate health care markets, (5) support acquisition of new knowledge, ( ...
Does the federal government have central control of healthcare delivery?The U.S. Department of Health and Human Services is the federal government's principal agency involved with health care services. The states cofund and administer their CHIP and Medicaid programs according to federal regulations.
What is health care delivery system in the United States?A national health service, where medical services are delivered via government-salaried physicians, in hospitals and clinics that are publicly owned and operated—financed by the government through tax payments.
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