Abstract
In the history of the United States healthcare system, major reforms have taken place to improve the state of health care affordability, accessibility, equitability, and quality. Despite all the milestones achieved, numerous gaps still underlie the healthcare system that must be addressed to achieve the desired goals. This project exploits primary data collection by reviewing peer studies to obtain information needed in the discussion. Findings place the high cost of healthcare expenditure in the center of the challenges that burden the healthcare industry in the United States. It further illustrates how health disparities created by past discriminatory policies have greatly contributed to the vulnerability of some populations to the high healthcare costs. Moreover, the study finds the inadequate public health workforce and the declining worker-to-population ratio a challenge that contributes to inefficiency in emergency preparedness and response of the healthcare industry. However, on the other hand, the high cost of workforce development and compensation is found to add to the high cost of healthcare spending. The findings show that despite marked improvements to the healthcare sector in the U.S., there still exist gaps such as social justice issues, the high cost of healthcare, provider reimbursement, policy issues, high out-of-pocket expenditure, for-profit interests, universal coverage, and quality and better outcomes that must be addressed to achieve desired outcomes.
Keywords: out-of-pocket expenditure, high health care spending, health disparities, Healthcare policy, cost containment.
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Introduction
Healthcare is an important sector whose level of success reflects any country’s economic growth and development. Due to its distinct nature as a service and its interconnectedness to life, death, and other aspects of the human life of transitions, it is a vital topic in the sphere of public consciousness. The wellness and productivity of a country’s workforce is a measure of the health of her people. In the history of the United States healthcare system, major reforms have taken place to improve the state of health care affordability, accessibility, equitability, and quality. Examples of the recent key reforms include Medicare, Medicaid and the Affordable Care Act of 2010. These reforms have substantively contributed to the improvement of health care delivery in the U.S. Lately, the Patient Protection and Affordable Care Act (2010) has been on the spotlight that despite its remarkable impact in lowering the number of uninsured citizens, several challenges in healthcare still exist that must be addressed in order to ensure the desired healthcare standards and outcomes are achieved. At the center of these challenges is the escalating cost of healthcare expenditure that has drawn the attention of many scholars, the public and other affected parties. This paper examines the cost challenge of the healthcare sector and explores the potential solutions towards ensuring a just and sustainable healthcare system.
In the recent past, budgetary cuts in Medicare and Medicaid have been implemented in efforts to resolve the issue of high costs. Apparently, the impact has negatively affected the whole healthcare system. The U.S. healthcare faces a policy dilemma on whether to address the high cost of health care as an issue of public interest or the for-profit interests that seek to maintain their status quo. Formulation of policy solutions to cut down the healthcare expenditure has been rendered difficult to implement owing to the existence of these conflicting interests (Clarke & French, 2013). The government is to blame for the failure to effectively regulate healthcare markets and properly appropriate healthcare resources through channeling funds and resources towards misaligned interests. It, however, remains unclear how the for-profit interests in healthcare can be eliminated, how the affordability of health care services can be achieved and at the same time taking into account all stakeholders’ interests. In addition, there are policy dilemmas on curbing the escalating cost of health care and whether it is a policy issue or not. The role of research and development in providing solutions is also not clearly known, thus making the whole issue complex.
The escalating cost of health care is one of the greatest challenges facing the industry. In a 2015 study by actuaries of the Centers for Medicare & Medicaid Services, it was established that health care spending cost the U.S. $3.2 trillion which was equivalent to 17.8% of the country’s GDP (Centers for Medicare & Medicaid Services, 2016). Furthermore, in an empirical study by Thornton and Beilfuss (2015), there was a 61% growth in healthcare spending between 1990 and 2009. This growth was associated with growth in incomes, greater provider availability, and other time-dependent factors. Part of this growth in spending is associated with the integration of technology into healthcare. Studies by Branning and Vater (2016) and Baker et al (2005) find high cost of healthcare to be associated with the for-profit motif in the healthcare system. Branning and Vater further state that in 2015, 17.8% of US’ GDP was spent on health care (p. 445). According to Hempstead et al. (2015), healthcare’s out-of-pocket expenses are too high that some populations choose to forgo preventive care services. As a result, providers opt for alternative payment interventions so as to minimize the pressures of negative outcomes such as unsustainable debts.
As a consequence of the high-pocket expenditures, provider debt levels may increase and access to care by low-income patients may be limited owing to the shifts in provider reimbursement and patient obligation (Hempstead et al., 2015). Reinforcing on the effects of high cost of healthcare spending, Mulvany (2014) projects that the escalating healthcare costs may lead the local employers and state Medicaid to shift the pressure onto healthcare providers to minimize vulnerability. He established that high health care spending may prompt employers to adopt value-based strategies for purposes of cost containment. Adding to the literature on healthcare spending challenges, Baker et al. (2005) argue that this state has been worsened by the serious and systematic underfunding of the public health infrastructure (307). State and federal policymakers have played a major role here because of the low priority they have accorded this area. Reports from the media and professional organizations show a reduction of funds meant for routine public health functions (Baker et al., 2005). This is an area that needs more systematic research studies to emphasize these concerns.
Whereas ACA (2010) and the competition in health care promoted by the US capitalist system have been cited as measures in lowering the costs, stakeholder interests and profit motives in healthcare business have been cited as the misaligned incentives that have caused the cost implications witnessed in the sector (Thornton & Beilfuss, 2015). Various stakeholders have distinct profit interests. Health insurers that allocate high profits to medical care expenses and pharmacists collect service charges and benefits managers with part of the savings. Also, healthcare providers want to earn large incomes to pay back their student loans as a justification of their devotion to patient care (Clarke & French, 2013). Profits are also derived from huge research and development costs, while pharmaceutical manufacturers regain from marketing (Querci, 2014). On the other hand, patients are motivated to spend the least of out-of-pocket funds as they look up to third-party payers to cover their healthcare costs. Finally, the government’s interest is to apportion minimal revenue for the provision of care for patients and vulnerable groups. These are among the for-profit motifs that govern the extensive healthcare system.
Considering the rising challenges facing health in America, it is important to note that there is an inadequate public health workforce. A 2000 enumeration study’s estimates highlighted a decline in public health workforce numbers registering a worker-to-population ratio of 1:635. In another midrange enumeration study conducted in 2013, a worker-to-population ratio ranging from 1:1010 to 1:909 was established, indicating serious erosion in the public health system’s functional capacity (University of Michigan, 2013). These statistics reflect the inadequacies in both formal graduate training and professional certification in the public health industry that further limit a worker’s career development hence lowering the performance capacity of health care organizations and agencies. It is also evident that public health graduates often seek employment elsewhere in relatively high-paying agencies (Baker et al., 2005). This inadequacy in the healthcare workforce is one of the major contributing factors to the challenges in emergency preparedness and response to disasters such as infectious diseases, natural disasters, terrorist attacks, chronic disease, injuries, and high-risk behaviors. Apparently, also, financing high-quality workforce production, compensation and wages, and incentivizing of healthcare professionals are costly interventions which add to the cost burden in the healthcare sector. While human resource development in health care is critical in enhancing the meaningful use of technology and promoting research and development, Walsh (2015) suggest that a balance in managing its supply and demand must be made.
In addition to challenges related to costs, the healthcare sector is flawed with disparities that are as a result of past policies that promoted separatism, social positioning, residential discrimination, differences in access to quality education, and other economic factors in American society. In a qualitative study examining how socio-demographic characteristics influence health outcomes, Jaffee et al. (2005) found that greater urban stress was reported by African-American caregivers with stress factors relating to employment, housing, and finances. The study further found that differences in social structures, institutional and cultural racism, and economic and political gaps are major determinants in the accessibility to quality health care. These disparities have rendered fruitless the efforts dedicated to the achievement of desired reforms and equity in the healthcare system. Relaying emphasis on this issue, Dubowitz et al. (2016) assert that politics play a critical role policy-making process, hence the necessity of considering the political realities such as hyperpolarization, coalition building, and soliciting for public support in policy formulation. Milo (1994) and Berlinger et al. (2014) highlighted that public housing, financing of food and nutrition, accessibility to education, and environmental well-being are the many ways that government policy that affects a population’s health Such unfair past policies led to residential, racial, and socioeconomic discrimination which renders some populations vulnerable to the high costs of healthcare (Dubowitz et al., 2016). Supporting the need for action, Preda and Voigt (2015) argue that addressing income and wealth inequalities are paramount in solving the existing healthcare disparities based on socioeconomic factors.
In conclusion, the challenges facing the US healthcare industry highlight the policy areas that must be addressed in order to achieve best outcomes desirable to all citizens of the United States. There is need for awareness and advocacy on the need for controlled health care spending by highlighting the policy dilemma that locks the healthcare system. It is important to emphasize that there exists a conflict between addressing the cost issue as a matter of public interest and maintaining the status quo of the for-profit interests (Clarke & French, 2013). In addition, the disparities inherent in the healthcare industry should not be existing in a diverse and civilized society as that of the United States in the 21st century. The government agencies and departments involved with health care have a responsibility in ensuring proper appropriation of healthcare resources and effective regulation of healthcare markets through heightened advocacy and exposure of credible evidence by influential societal groups and agencies. The whole American society, in particular, those in influential positions in both government and private agencies and organizations must work collaboratively to ensure equity, accessibility, affordability, and quality in health care through implementation of effective policies, procedures, and laws. More importantly, despite the heavy funding on research and development in the healthcare industry, their findings have not been implemented or have been underutilized. This is evidenced by the unmatched quality of care and poor healthcare outcomes.
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