How to Drive Down Healthcare Costs

Julie Shenkman
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Health care costs are increasing at an alarming rate, partially due to the Affordable Care Act and the new demand for access. The Affordable Care Act made health care far more accessible to individuals who may have not had the resources to see a doctor before — thus, new patients are filing in by the hundreds of thousands. And the costs associated with new patients and health care may only continue to climb.

How can the United States drive down the cost of health care? One way to lower the cost for providers is to make the cost of procedures, medications and visits more transparent and less obscure. Not only does this outline costs for the patient, but it creates a clear method in which health care providers and hospitals can examine profitability and use administrative, clinical and financial data to streamline what may otherwise be lengthy, expensive processes.

For consumers, health care costs can end up being phenomenally expensive. Even with insurance, some surgeries and brand-name medications can be outrageously priced and can even lead to bankruptcy for some patients. Insurance premiums may be too low for middle- or low-income families. States that allow Medicaid to cover patients just above or at the poverty level are making strides in lowering the cost of health care for patients. Premiums have decreased by 15 percent since the enactment of the Affordable Care Act.

Health care costs, however, are going to continue to climb for businesses — but that doesn’t mean profits aren’t going to keep up. As new patients visit doctors and receive overdue surgeries and medical care, hospitals and primary care doctors may see an increase in revenue. As demand for health care grows, so do the number of jobs available in the health care industry.

Without help from state and federal governments, such as expanding Medicare and children’s health insurance programs, health care costs to both businesses and consumers may only continue to increase. Those who remain without insurance face large, overdue health care costs later, and businesses must now supply enough workers to meet the demand for access. Likewise, hospitals may struggle with profits as the trends shift toward more home-care oriented medical care.

Health care costs make up most of the nation’s spending — in fact, the United States spends more on health care than 46 other leading first-world countries in the world and U.S. health care costs are higher than Russia’s national GDP. Each insured American costs the United States about $8,000 in medical costs and care.

Though it may take several years to see the benefits of the Affordable Care Act, the United States Is beginning to incur the costs in 2014; businesses and individuals are beginning to see the difference in cost and price right away. Whether or not the price will drop is yet to be seen.

 

Image courtesy of Images Money at Flickr.com

 

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