US Shaping Health Care Economics - Coursework Example

HEALTH CARE COSTS AND EVENTS SHAPING HEALTH ECONOMICS Why does health care cost so much in the United s? Does everybody receive the same amountof care? What are the events shaping health care economics? Figure 1 indicates that states of the United States vary with regard to medical spending per capita. In 2005, some states are spending as low as about US$5,200 per capita while others are spending as high as US13,000 per capita for health care. Figure 1. Medical spending per capita in the United States, 2005 Source: Dartmouth Atlas of Health Care as cited by the Congressional Budget Office 2008 Meanwhile, Figure 2 on the next page suggests that health care spending per beneficiary in the United States is in the neighborhood of US$4,500 to nearly US$8,000 per beneficiary in 2004. Yet, as indicated by Figure 2, there seems to be no correlation between the amount spent for health care and the quality of health care. We put into context Figure 2. According to Carey et al. (2009, p. 2), health care outcomes in the United States rank poorly among the Organization for Economic Cooperation and Development (OECD) countries but it is also in the United States where health expenditure is highest. However, the public share of health expenditure in the US is much lower than the other OECD countries except Mexico (Carey et. al., 2009, p. 11). The high cost of health services in the United States reflect higher relative prices compared with the other OECD countries. Carey et al. (2009, p. 21-22) say that a growing percentage of the US population is uninsured. The US, together with Mexico and Turkey, are the only OECD countries without universal health insurance (Carey et al., 2009, p. 21). The number of persons in the US without health insurance increased from 38 to 46 million from 2000 to 2007, reflecting also a percentage increase from 14% to 16% of the US population (Carey et al., 2009, p. 21). Likewise, they also point out that an increasing percentage of the US population is underinsured (Carey et al., 2009, p. 23-24). Figure 2. Spending for medicare and quality of care, 2004 Source: Congressional Budget Office (2008, p. 2) Unfortunately, according to the Committee for the Elimination of Racial Discrimination (CERD), Americans may not be receiving health care equitably. According to the CERD in 2008, there are disparities on health care received based on race. Figure 3 next page describes the situation. Figure 3 suggests that only 8% of white Americans report that they have received poor or fair health services while this is about 14% for Hispanics, 15% for African Americans, 16% for American Indian, and around 13% for Americans coming from two or more races. At the same time, controlling the variable educational attainment, Figure 3 also suggests that infant mortality rates are highest for African Americans and American Indians compared to White Americans. Figure 3. Health outcomes according to race Source: CERD 2008 (p. 10) In summary, therefore, health spending is high in America and Americans are not receiving health services equitably. What are the events shaping health economics in the United States? One event shaping health economics in the United States is the on-going debate on the key issues of health reform. According to Jaffe (2009, p. 1), the key issues of health reform in the United States are the role of the federal government in financing and delivering health services, lowering the rate of increase of medicare spending, and advance planning for serious illnesses. The health reforms undertaken in these areas will definitely affect the quality of health services but it is unclear whether equitable access to health services will improve because the definition of health reform issues does not seem to address the concern for equitable access to health among races. Perhaps Jaffe does not recognize the concern to be even real. Another important event is the ongoing economic crisis or risk of a depression in the United States. Describing the ongoing US crisis or threat of crisis as a financial crisis, the World Health Organization (2009) has expressed its deep belief that the ongoing crisis will have a severe effect on health worldwide. The crisis that is widely attributed to the sub-prime crisis of the United States, will also have an impact on American health. Many Americans have been out of work and this number can increase if the crisis worsens. As firms close down and as Americans become out of work, tax revenue earnings of states will decrease and there will be little allocation for services related to health care. Many Americans can lose or decrease their health insurance coverage. It may mean that many Americans would be unable to get the rest and nutrition they need as they become out of work or as their incomes decrease. The third ongoing event shaping health economics in the United States are the US wars in Iraq and Afghanistan. There are two fundamental impacts on health as the United States go to war with any country. On one hand, the war effort uses funds and competes against health in Congressional budget allocations. At the same time, the other fundamental side to the situation is that a war can produce soldiers in crutches and who are disabled who must be eventually be brought back home on American soil. American society has a responsibility to take care of these soldiers in their places of location and when they are eventually returned home. A caring society should have adequate allocation for these veterans as they return home in crutches or disabled. The fourth ongoing event that will inevitably shape health economics in the United States are the rise of new health threats in the 21st century. In the last several years, as international mobility significantly increase, several diseases threatened to become world pandemics: AIDS, SARS, H1N1-influenza and the like. It is highly likely that there will be more threats of pandemic in the years to come. This implies that governments must allocated funds for pandemic preparedness, detection, and response. This means that the United States government must have stocks of medicines more than the usual, hospital beds that exceed the usual requirements, and facilities that can be converted easily to health care centers. Another implication is that the United States must have adequate funds for health research and must be ready to deploy a large team of health researchers to discover a cure for an emerging pandemic. This may mean that it may not be enough to rely on the market alone. The fifth event that will shape health economics in the United States comes from the change in lifestyles that the United States is experiencing. The developments in the 20th and 21st centuries favored a sedentary lifestyle. Some of the ailments associated with a sedentary lifestyle include stroke, heart ailments, and diabetes. Risks on these ailments may be greater than the usual and health insurances must be reviewed if coverage for these ailments is adequate. Preventive measures can help a lot in avoiding the diseases and any form of insurance does not cover this. Government, therefore, has to undertake measures related to the prevention of the onset of ailments related to sedentary lifestyle. Finally, the sixth event that will most likely shape health economics in the coming years is the ongoing global warming and its impact on the world and the United States. Global warming is definite. What is only being debated is whether the global warming is anthropogenic or natural. Of course, the United Nations Intergovernmental Panel on Climate Change has concluded that it is most likely anthropogenic. Nevertheless, whatever the case is, global warming is ongoing. Most likely, there will be ailments that are positively or negatively correlated with the warming. Health research must discover what these ailments are and stockpile medicines, as necessary, based on the ailments foreseen to be on the rise or on the decline. In conclusion, health economics must continue to assess how markets and governments can complement in producing the best outcomes for health for everyone in American society. The outcomes must be that those that do not discriminate. One area of possible discrimination is race but other forms of discrimination may be based on gender and age. Reference Carey, D., Herring, B., & Lenain, P. (2009). Health care reform in the United States. Working Paper No. 665. Organization for Economic Cooperation and Development: Economics Department. Committee for the Elimination of Racial Discrimination (CERD) Working Group, (2008). Unequal health outcomes in the United States. A report to the U.N. Committee on the Elimination of Racial Discrimination (January). Jaffe, S. (2009). Health policy brief: Key issues in health reforms. Health Affairs, 20 August. Robert Wood Johnson Foundation. US Congressional Budget Office, (2008). Health care and behavioral economics: A presentation to the National Academy of Social Insurance, 29 May. Retrieved 26 May 2010 from http://www.cbo.gov/ftpdocs/93xx/doc9317/05-29-NASI_Speech.pdf World Health Organization (WHO), (2009). The financial crisis and global health. Geneva: World Health Organization. Read More