Issue Faced by Hospitals - Essay Example

Issue Faced by Hospitals School Affiliation This paper is about how hospitals are faced with different economic problems in the world today. The paper gives an insight on how economic recession 2008-2009 brought people to downfall and how with increase in unemployment the percentage of insured patients has lowered. The paper also encompasses the background of the problem, plus it also gives an insight on how the situation is being handled and how I propose it could be handled in a better way. Moreover, it also gives an overview of how the issue might be likely to change in future. This report will help us learn how hospitals as organizations are affected by economic downturn and the extent of effect of such situations on hospitals. Keywords: uninsured patients, recession, economics, hospitals. Background Due to global recession 2008-2009 people throughout the world faced a lot of economic obstacles and have been trying to deal with them ever since. Due to these economical problems a lot of people have become unemployed. Some of the self-employed people had to give up on their businesses; others had to sell their properties. Some had to let go of their properties because they were not able to pay the mortgage loan. Thus, with the recession there was an increase in prices of commodities and due to high level of unemployment people were unable to meet extra expenses. Some even could not pay for their insurance, which is why there was a constant increase in uninsured patients. The higher the unemployment increased, the more there were uninsured patients. Thus, with recession and with all the other organizations facing losses and getting bankrupt, even the hospitals faced this problem and to date are facing this issue. The costs of hospital services increased just like the cost of any other commodity or service in recession. Plus, the customers were unable to make payments and many were even uninsured. “The survey showed a 33 percent increase in uninsured patients visiting the emergency room” (Business Life, 2011) Earlier, hospitals used to be non-profit organizations usually supported by governments and other donations. Now, however, hospitals have become profit generating organizations and have become deadly expensive for the common populace. Having medical insurance is important for the people today in order to pay their medical bills without much stress. Most of the uninsured patients do not pay the hospitals back, thus keeping hospitals in loses and in most cases, the hospitals charge the insured people so high that their cost for uninsured patients is compensated but the burden shifts on those insured or paying for the hospital. According to American Medical News, 2011; “In 2008, hospitals had 2.1 million hospitalizations of uninsured people. About 1.2 million, or 58%, ended up with hospital bills in excess of $10,000. Hospitalizations with costs of more than $100,000 accounted for 6% of uninsured hospital stays.” The above statement shows just how much the hospitals are affected by the non-payment and how they are bound to charge the uninsured patients. Hospitals also have to undergo a lot of costs all of which increased during the period of recession, which meant they had to increase the prices for the patients in order to cover those costs. One of the key findings of a survey held in California in 2008 was that there had been a 73 percent increase in hospital consumers who are finding it difficult to keep up with rising out-of-pocket health care costs. (Whitmarsh, 2011) According to a research report from May, 2011, “Hospital stays for uninsured patients jumped 21 percent between 2003 and 2008.” The same report also states that the uninsured hospital stays were the highest in 2008. All of the data shows how patients are unable to cope with the increasing hospital charges. However, going to hospitals is vital for every patient, which is why this cost has to be covered either by the state or by the hospitals. The hospitals can cover these costs only by sharing the burden with paying or insured patients. What is Being Done About the Situation? Payment for health care is made by the state when it comes to public hospitals. The American government pays about 16% of GDP on healthcare. It is estimated that in coming few years the rate of uninsured individuals will go up even more. The graph (OECD, 2009) above shows how America has been allocating more budget to healthcare each year. The graph above shows which kind of population spends how much on health in U.S. Journal of the American Medical Association (JAMA) proposed several solutions for the healthcare system. Some of which included that the employers should pay for the medical expenses of individuals, secondly individuals can be made to pay for the medical expenses annually just like they pay income tax etc, thirdly some form of partnership or alliance can be formed in order to pay for the hospital expenses and the uninsured patients. Nowadays there is a growing trend of charging patients a lot. This refrains the patients to go to hospitals and increases illness. My opinion I think that the government is allocating a good deal of GDP on healthcare but there need to be more effective ways in order to deal with the uninsured patients in a manner that it would neither affect the hospitals nor would it affect the government as such. Moreover, there are patients who do not go to doctors because they are unable to pay the hospital’s fee. So they stay at home until their pain goes away or the condition becomes worse enough to get the patient to the hospital in Emergency Unit. This increases expense of medicines that could have been saved if the patient had gone to the hospital at the right time. Thus, it increases expense of the hospital, the patient and the government. Furthermore, it causes absence in work place as well because the patient might not be able to make it to work for a few days while he recovers. Also, a lot of lives are lost because of this scenario. I think what needs to be done is either one of the following: 1. Formation of a healthcare body 2. Employers to pay for their employee’s health 3. Government to make medical fee payment integral like income tax 4. Organizations to form a venture with a purpose to help uninsured patients. 5. Hospitals to reduce charges Some medical institutions are thinking in the line that I am thinking. These include American Academy of Orthopedic Surgeons and Journal of American medical Association in my knowledge at least. This issue can change in future if the hospitals and government come up with a viable solution from any of the above or a different one that is more feasible to them. However, there are more chances of the condition getting worse if nothing is done about ti right now. As the uninsured patients are expected to increase even more in the coming years, there is yet another threat to the hospitals and other healthcare institutions. It is high time for the government to take action in order to come up with more plausible solutions to make the condition better. Conclusion Thus, if the government helps the hospitals and sits down with the CFOs and discuses the possible solutions there is every bit chance that the uninsured patients might get help from the government or other institutions. This will help in making the condition of hospitals better and will prevent the hospital from shifting the burden on the insured patients, thus will be of aid for almost all the stake holders in the scenario. References Whitmarsh, C. (2011). Hospitals Facing Economic Challenges. Business Life. Retrieved from http://www.businesslife.com/articles.php?id=1104 Fiegl, C. (2011). Most uninsured Stays Go Unpaid. American Medical News. Retrieved from http://www.ama-assn.org/amednews/2011/05/16/gvse0520.htm Agency for Healthcare Research and Quality, 2011. Uninsured hospital stays surged from 2003 to 2008. Retrieved from http://www.ahrq.gov/research/may11/0511RA18.htm American Academy of orthopedic Surgeons, 2011. What’s to be done about the uninsured?. Retrieved from http://www.aaos.org/news/bulletin/may07/cover2.asp Working Californians, . Health Spending Graph. Retrieved from http://workingcalifornians.com/files/healthspendingKaisergraph.gif OECD Health Data, 2009. U.S. healthcare Spending. Retrieved from http://upload.wikimedia.org/wikipedia/commons/d/dc/Health_costs_USA_GDP.gif Read More