Health care's economic impact - Research Paper Example

Health Cares Economic Impact Currently, the growth of health care spending in USA has overtaken the growth rate of the population, gross domestic product and inflation. It was rated at 6.5% in 1990 and it has from since risen gradually. At 2005, it was rated at $6,667 per capita (Samuelson 4). This represented 16% of the American GDP. The projections states that the heath care will consume 20% of the GDP by 2015. This increase is expected to have adverse effects to many economic indicators such as per capita GDP, inflation and employment (Samuelson, 3).

The measures expected to be put in place to ease the situation are likely to adversely affect other sectors of economy. The interrelatedness between various sectors of economy is expected to worsen the situation in the U.S economy. The increased costs will make the government reduce investments and consequently unemployment will increase (Samuelson, 5). According to Congressional Budget Office, 2009, the changes in the health care will definitely have various adverse effects on citizens. The plans are expected to extend health care insurance to nearly four million children from both low income and middle income families by the end of 2013. The U. S.

health care spending exceeded $2.5 trillion in 2009. This represented 17.6% of the GDP. With no major reforms in the health sector, the projection of the spending is expected to be one-fourth of the GDP by 2025 (Congressional Budget Office 8). The spending is similarly, expected to reach one-third of the GDP by 2040. This will be a very high burden to many families and individuals. According to the current research, the average family income in the U. S has dropped by 4.3% in the period between 1999 and 2008.

This research further shows that the weekly earning of a full time worker increased by 1.8% while the total spending of employer sponsored health insurance increased by 69%. The federal spending on the health care has also increased from 11.1% in 1980 to 25.2% in 2008 (Congressional Budget Office 8). On the other hand, American Heart Association, 2009, the health care program is destabilizing the economy of the United States. The unemployment is in the rise as it has been noted to be at 9.5% in 2009 which was more than double increase from 4.

65% in 2007. This is because the program is consuming a big portion of the GDP which has translated to low investments hence low employment opportunities. The health care spending is too high for many people as the research has shown that every one employee in four earns 2000% below poverty received health coverage (American Heart Association 6). The analysis of any issue by difference sources provides a better understanding because each source uses different point of view. These sources provide a clear picture which can be used to make excellent decisions to better the economy.

The health care program can destabilize USA economy only when the necessary measures are not put in place. With proper mechanisms in place to control fluctuations in the economy, the program will be definitely of benefit to USA citizens. The well being of the general public is likely to improve as the poor will be greatly assisted to meet their health care expenses. The current complications are only due to numerous changes that have been brought on board. Works Cited American Heart Association.

Americans Skimp on Healthy Activities in Bad Economy. May 17, 2009. Print. Congressional Budget Office. Patient Protection and Affordable Care Act, Incorporating the Manager’s Amendment. Letter to the Honorable Harry Reid. December 19. 2009. Print. Samuelson, Robert. Let’s not hide health costs. Newsweek. February 5, 2007. Print.