HCS/440 Read Me First

Read Me First HCS/440

Week Five

Introduction

Health care reform has been on the political calendar since the founding of America. Presidents Teddy Roosevelt and Truman tried and failed to get universal coverage. In 1965, coverage for catastrophic health care was added to Social Security benefits. This plan was Medicare and, in the first year of operation, had millions of enrollees. During the 1990s, President Clinton tried and failed to implement health care reform. In 2006, an amendment was made to the Social Security Act that covered payment assistance for outpatient medication.

Barack Obama was inaugurated as president of the United States in 2009. One of his major campaign pledges was to implement health care reform and cover American citizens without insurance coverage. This effort has led to the Affordable Care Act of 2010, and that Act is still being challenged in court.

As health care reform legislation takes shape over the next 5 years, our challenge as health care leaders is the implementation of new legislative requirements. Preparation is underway in many health care institutions to ensure that they anticipate the change in supply and demand, so they maintain a viable and affordable service to all consumers.

This week in relationship to the course and the program

This is the final week of the course. The objectives include projecting the future use and cost of health care in the United States, and evaluating the drivers and barriers for health care reform. So far, this course has explored health care suppliers and buyers, the public and private payment for health care, and demographic and scientific trends. All are factors that must be analyzed before looking to the future.

By this point, it should be clear that the average person cannot pay for any significant health care event. A simple illness or injury will quickly turn to thousands and tens of thousands of dollars. This is the major driver for some form of universal insurance. The answer seems clear: such coverage is necessary.

Health care for the elderly has led to staggering costs. These costs have far exceeded government projections and threaten to cripple the viability of Social Security. The tax burden placed on individuals and the industry by Medicare and Medicaid have hampered American goods and services from equal competition in the world marketplace. Should these systems be expanded to cover all citizens?

Even if a choice for universal coverage is made, the details are important. Previous readings show that health care does not follow the same rules as other commodities in the economic marketplace. Furthermore, there are value judgments attached to illness and payment for conditions that are not part of other economic decisions. These include the difficulty on putting a dollar value on health and life, and in assessing the responsibility for lifestyle choices. Thus, understanding the finance of health care is the beginning in understanding issues surrounding the debate.

By the end of this program, you will have the skills to make decisions about these details. This class has provided you with some basic economic skills. Other classes will focus on the ethics of health care, the law surrounding health care, the need to provide care to the individual, and the need to provide health care to communities. You will find that true improvements in health care may be achieved by societies that provide clean food and water, decent housing, adequate education, and equal opportunity. All elements are necessary to achieve health care reform.

Some questions to ask as you hone your critical thinking

The first question to consider this week is “Who pays?” Should health care be a privilege and each individual’s responsibility? Should you be allowed to decide if you want to spend your money on some form of health care insurance or use it for other purchases? Should you be allowed to decide that you live a healthy lifestyle, and you will pay out of pocket for your needs? If you get into a situation that is beyond your ability to pay, should you have to suffer the consequences? Should those consequences include permanent damage or death?

Is illness and infirmity a burden on society and health care for every citizen a right? Think of other rights extended to American citizens. We are entitled to free primary education, a safe food and water supply, public health surveillance for communicable diseases, and police and fire protection. These are all funded by public money, which comes from taxes. Should health care join that list? Is the average taxpayer willing to assume that burden?

If a public health care system is selected, who should be the administrator? Should the same people who run Medicare run a national health system? Is the Medicare system running well enough to be expanded to everyone? If a public option is selected, what happens to the current health care insurance industry? How would the transition from private to public be orchestrated?

The issues of how much and to whom is further complicated by the aging of the population and the rapid advance in health care technology. Both factors have contributed to marked increases in health care costs. How will anyone predict costs in the future? Is rationing health care the only solution?

Summary

You leave this course with a basic understanding of economics and can apply economic principles to health care. You can now identify health care as an industry. This industry is subject to the effects of changes in supply and demand, manpower needs, technological advances, regulations, and customer concerns for quality and price.

The United States spends more currently on health care than any other nation, yet we are far from first in health care outcomes. Our major allocation of dollars is spent at the end of life, with few meaningful years obtained from the expense. We use emergency rooms as our primary care provider for the underserved. We treat end-stage diseases rather than fund prevention or early detection. Is this a pattern of spending sound economics?

Certainly, we have many questions about current and future health care. Unfortunately, the answers are difficult, costly, and possibly painful. Your role as future health care administrators will not be easy, but will be critical to the nation’s health and safety.

1