Thursday, 28 July 2011
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Reasonable Health Care Cost Analysis
Health Care cost continue to increase due to the population of aging people. Patients are sicker than ever before. Hospital costs are on the rise. The history of health care cost control suggests that the likelihood of long-term success of any particular idea are low. Is it feasible that we can reduce health care cost by giving better care ? I heard this story on NPR a couple weeks ago and it is fascinating to me because the rising cost of health care has become a obstacle to my early retirement plan. The increase of drug use and poor various living styles has increased medical costs. The increase in patients filing Mal-practice suites on doctors also increases medical costs. Some insurance companies are promoting programs for good health.
During these programs people are awarded for healthy eating habits, exercise programs and making good choices in their lifestyle. Dr. Brenner and his team were able to lower the all around health care cost by taking better care of those most difficult cases. They followed up with patients to make sure they took their medication, tried to get them to quit smoking, and encouraged them to rejoin their churches and communities. These were basically coaching these patients to consider better care of themselves. Their efforts were successful and many patients improved their long term health and their overall costs were lowered consequently. The analysts posited that the effect of excess cost growth on economic outcomes depends on the percentage of workers with employer-sponsored insurance (ESI). Health care cost growth would have a stronger effect in industries that have a larger percentage of workers with ESI:
Increased health care costs can result in higher labor costs, that might cause firms to hire fewer workers, produce less output, or raise prices. This back-and-forth between the government and industry signals the difficulty of developing, enacting, and implementing effective measures to bend the health care cost curve. What should be clear, however, is that a strictly voluntary effort to slow the growth in costs is unlikely to be successful, and that health reform will need to incorporate legislative provisions and enforcement mechanisms to make sure that spending targets are met.
The extent to which an increase in health care costs affects output and employment in different industries depends on how much total compensation rises because of health care cost inflation. Industries where health care benefits are a larger share of total employee compensation are experiencing a larger increase in total compensation, consequently leading to a larger reduction in employment and output. I believe our Nation's long-term fiscal problems, and the problems resulting from the growth of per capita health care spending, are higher priorities to solve than reducing the number of uninsured Americans now. I would rather solve America's health care cost problems of the future than expand government now. This really is my value choice. I expect and believe that others will disagree.
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