The Problem with the American Health Care System
The American health care system is under duress.Some people praise the US medical system because of the availability of state-of -the-art treatments while some criticize because of the many loopholes of the system and problems with insurance.Because of loopholes in the insurance system and the high price of getting medical treatment in the country, many ordinary American folk do not get basic health while only the high-income earners can handle high medical costs.
Despite of the existence of government health insurance, American citizens still feel the need to buy insurance from public firms since the government insurance system does not cover much of the medical needs of the people.
Before analyzing the American health care system, it is first important to have a clear view of the system and the problems with it. The American health care system is made up of both public and private insurers but the unique part of this system is that the private sector remains dominant over the public sector.
Statistics indicate that 62 percent of non-elderly Americans receive insurance receive from their employers in the private sector while 5 percent purchased their own insurance from private insurance companies. A small 15 percent rely on government insurance systems such as Medicare and Medicaid. Those who do not have any form of insurance account for 15 percent of the total. Public Health Insurance is mainly provided by Medicare and Medicaid (Chua, 2006). Medicare covers people at age 65 and above including some disabled people.
It is a government single-payer program which is funded by tax collections, a payroll tax and paid premiums. It is funded together by the federal and state government. Medicare covers hospital services, physician services, and medical drug benefits but over the years, weaknesses have been spotted in this insurance system such as it includes an incomplete coverage for nursing facilities as well as an insufficient preventive care coverage. It also does not provide for dental, hearing and vision health care.
Because of the lack of services, the elderly folk that avail of Medicare are forced to get insurance plans from private companies, and thus, many of the old folk spend 22 percent of their income for providing their personal health care needs not covered by government health insurance (Chua, 2006). Medicaid on the other hand is an insurance program specifically provided for the disabled and for low income earners. It is stated under federal law that states must provide medical care to the very poor pregnant women, children, elderly, disabled, and parents.
Adults that have no children receive no coverage from Medicaid as well as poor people that have a higher income that make them unqualified for Medicaid benefits but states have the freedom to alter eligibility levels. Just like Medicare, Medicaid receives funding from taxes. Medicaid has many good benefits but many of those who have availed of this insurance program find it difficult to look for health care providers that accept Medicaid because of a rather low reimbursement rate (Chua, 2006).
According to the data from the Organisation for Economic Co-operation and Development (OECD), the US spends the highest on health care among the member countries in the OECD. In 2003, US health care costs accounted for 15 percent of the country’s GDP while the average for all OECD countries only figured at 8. 6 percent. Among all OECD countries, the US also incurs the most spending on health care per capita with $5,635 which is more than double the OECD average of $2,307. From 1999 to 2003, per capita spending on health care increases by an average of 4.
6 percent every year which is at par with the OECD average of 4. 5 percent per year. In most countries from the OECD, health care funding is usually provided by the government except for the US, Mexico, and Korea in which the private sector dominate the health care industry. Only 44 percent of health care spending is provided by the government in the US setting while the average government funding for health care in the OECD is at 72 percent. The US also has the highest health spending from private institutions at 37 percent.
The US also lags behind on physician per population averages, nurse per population averages and hospital beds per population averages (Chua, 2006). These comparative data shows that the US has indeed been putting much budget into health but despite of this, the US has been performing poorly in providing the health care needs of its people. This may be traced from higher costs of health care since private institutions are more focused on profit. As of 2004, government pending on health care rose to 16 percent, in comparison, this is more of what is being spent on food.
The rising costs of medical treatment stems from new medical technology. This results in a division of the population that may be referred to as “insiders” and “outsiders”. Insiders are those that have good insurance while outsiders are those that have little or no insurance. The insiders receive the best medical treatment regardless of the cost while the outsiders receive very little treatment that they should have been accorded. To quantify, one study indicated that those people with no insurance have a 70 percent more likelihood to die from colorectal cancer within a time span of three years (Krugman and Wells, 2006).
The only way advanced medical technology can be provided to all people and not only to the financially capable is through health insurance but it would be difficult for private insurance companies to provide such a need because of the problem of adverse selection. Hence, healthy people would have to pay less premiums for insurance since they are not likely to accumulate large medical spending while those unhealthy people that are expected to accumulate large spending on medical treatment and hospital bills will have to pay higher premiums (Krugman and Wells, 2006).
The insurance company would quickly find that because its clientele was tilted toward those with high medical costs, its actual costs per customer were much higher than those of the average member of the population. So it would have to raise premiums to cover those higher costs. However, this would disproportionately drive off its healthier customers, leaving it with an even less healthy customer base, requiring a further rise in premiums, and so on. Krugman and Wells, 2006
Insurance companies have learned how to deal with this problem using risk assessment with the aid of a careful screening process. This results in rejecting or charging more premiums for applicants that are more likely to incur higher treatment costs. This practice bars many of those who are greatly in need of insurance from getting one. If ever a person is allowed to get an insurance despite of the conditions, the premiums would be very high (Krugman and Wells, 2006). Insurance is important for health care since it will affect the health of people.
With the presence of insurance, the people will have a better grasp of preventive care. A study by The Urban Institute indicated that about 50 percent of children that did not have any health insurance did not have a medical checkup in 2003, whereas only 26 percent of insured children did not have a checkup (National Coalition on Health Care, 2008). This shows that people are most likely to pursue early medical treatment in the presence of an insurance policy. People who are uninsured also pay before receiving any medical treatment except during emergencies.
If they are unable to pay, they will be denied medical treatment. In the presence of insurance, a person will not be denied medical treatment because the insurance will readily pay for it (National Coalition on Health Care, 2008). Instead of eliminating expenses, lack of insurance policies only results in more spending for the government since the governments pays for the health expenses of those people who are unable to pay for the medical treatment they received in the absence of a health insurance.
Also, data indicates that hospital accumulate $34 billion of unpaid health care every year while $37 billion is paid by private and public payers for the uninsured while $26 is paid from out-of-pocket for the people who did not avail of any insurance policy for some reason (National Coalition on Health Care, 2008). The number of uninsured people is steadily increasing due to the complexities involved in getting insurance but the highest driving factor is the high premiums. Job instability and other changes such divorce, retirement, self-employment, etc.
are also reasons why people do not avail of insurance (National Coalition on Health Care, 2008). Addressing health care is very important for any country especially for a developed nation that has a high population like the US. The presidential candidates both have proposed health care policies as a part of their agenda. These policies may be viewed from their websites and they both put addressing insurance problems the top health care issues as well reducing the cost of basic health services.
The reason why health care is too costly in the US may partly be because doctors are more highly paid but a better reason would be because much of health care payments are done by private insurance institutions. This results in more expenses since people pay more premiums just to get the better benefits of a private insurance system and since these private institutions are business entities, premiums are higher for higher risks of expensive medical treatment. For the government, profit would never be an issue.
What the two presidential candidates, Barrack Obama and Hillary Clinton are proposing just might work. They are proposing a new health care insurance system that promises affordable premiums and good benefits under the government. If implemented properly and with scrutiny, these plans might be a way to uplift the country’s health care system since it promises more coverage while providing friendlier premiums. Shifting from government insurance that provides good benefits would be the ultimate answer to the rising costs of medical treatment.
It is notable more and more people are getting medical aid from Medicare or Medicaid but this does not stop people from getting another health insurance at a private institution since government funded insurance does not provide all the medical needs of the people. The government should provide insurance policies that are will provide for most or all of the medical needs of the people at friendly-priced premiums. This way, the health care system will improve. References Chua, Kao-Ping. 10 February 2006. Overview of the U. S. Health Care System. Retrieved May 26, 2008, from http://www. amsa.
org/uhc/HealthCareSystemOverview. pdf Krugman, Paul & Wells, Robin. 23 March 2006. The Health Care Crisis and What to Do About It. The New York Review of Books, 53,5. Retrieved may 26, 2008, from http://www. nybooks. com/articles/18802 National Coalition on Health Care. 2008. Health Insurance Coverage. Retrieved May 26, 2008, from http://www. nchc. org/facts/coverage. shtml Plan for a Healthy America. Retrieved May 26, 2008, from http://www. barackobama. com/issues/healthcare/ American Health Choices Plan. Retrieved May 26, 2008, from http://www. hillary clinton. com/feature/healthcareplan/summary. aspx