TOP 10 REASONS WHY HEALTHCARE COSTS ARE HIGH
The effect of the pandemic has subsided but can the same be said for its impacts? This question borders on the interactions that exist in the healthcare industry regarding issues that pertains to health. It is important to understand the factors that are responsible for high costs in the healthcare industry in the US. While there are lots of reasons for high healthcare costs in the US, it is necessary to discuss the chief reasons. The top 10 reasons why healthcare costs are high in the United States are discussed below as:
Greater emphasis on quantity in place of quality: This is a trend in the healthcare sector. The healthcare industry no longer pays close attention to quality of medical services that are offered to the public. There is a greater emphasis on the quantity of services that medical practitioners can offer as insurers pay professionals using this measure. An example is Medicare. In Medicare, doctors and other health professionals are paid under a fee-for-service system. This implies that they are paid for the number of individuals they attend to. This method encourages an increased number of redundant testing on patients that have questionable means of getting improved health.
Higher number of unhealthy population: The research conducted by national Center for Biotechnology Information revealed that a greater percentage of the American population deal with at least one chronic health condition. As the number of the sick population increases, the insurance also increases as well. The risk involved in this also directly affects the insurance premiums.
Technology: This is of a great importance in the healthcare industry. But, technology has comes with a price. This advancement in the medical field does not come cheap. A study has revealed that Americans are more comfortable with newer technology for medical fields even when they have little or no proof about its effectiveness. This erroneous assumption always leads to great demand of technological methods by patients and medical practitioners. To this effect, the cost of healthcare also increases.
Dependence on choice of healthcare: Many Americans rely on their employers to make decisions about their healthcare plan. This is because they get their insurance from their employers. When such power is surrendered to an organization, the employer decided on the type of healthcare plan to choose even when it is too expensive for the employee.
Inadequate information: Regardless of the awareness created on healthcare services, a lot of people are still uninformed about the healthcare services and its costs. There is no certain way of understanding treatment options and its cost. Sometimes, when certain treatment is not very helpful, it takes a longer time before the information is made known to all. Other times, when hospitals make their prices public, a lot of people still find it difficult to comprehend it. Many times, hospitals make use of codes and people with knowledge of the healthcare industry may not be able to decode what is written and understand the process stated.
An advantaged system: The latest trend in the healthcare industry is merging and acquisition. While this is a welcome development, it has reduced the number of competition in the state. Competition in the healthcare industry is largely responsible for lower prices, productivity and efficiency. But, the absence of competition has given rise to a lot of other factors. To this effect, hospitals can charge higher prices without having any competitor to affect its price. This situation is responsible for high cost of healthcare in the United States of America. So, while it a partnership system has brought some advantages, it has also affected cost of services provided in the sector.
The fear of lawsuits: Medical practitioners can be charged to court if they are found wanting of ‘defensive medicine’. This is why doctors can easily prescribe tests to patients out of fear of a lawsuit. Oftentimes, these tests are not necessary and would only make the patient incur costs that can easily be avoided. So, the healthcare practitioners withhold information or knowledge that can be beneficial to patients. Rather than aid them in the way they can, medical practitioners can choose to protect themselves first and avoid the wrath of the law.
Cost of administration: The healthcare sector will not be able to perform well without the administrative team. The administrative arm of the healthcare industry is very important in running the hospital system efficiently. The healthcare industry is taken care of by various payors. As long as many stakeholders are involved, the costs will increase. Thus, administration becomes a complicated process. The medical billing process is very important and also costs a fortune. Billing and insurance related cost is important in the administration of the healthcare industry as it encompasses payment processing and claims submission. All of these affect the costs that patients are faced with in the healthcare industry.
Specialty care: There is an overuse of specialty care in the healthcare industry. The number of primary care physicians has reduced and the number of patients that desire the services of a specialist has increased. Specialty care is very expensive as compared to primary care because specialists are known to demand higher fees for services. In the same vein, the treatment and evaluation of a patient may require more than one specialists and this will require a lot of costs.
Physician fees: The fees of making use of physician services are very high. In the healthcare industry, physicians are more compensated in the US compared to other professionals that are in the United States. This disparity is because of the level of training that is accorded to medical practitioners as compared to other professionals. The cost of physician fees in the US constitutes a major cause of high healthcare cost in the US.
The United States of America is one of the few countries in the world that pays attention to its healthcare industry. While this is correct, there are facts that have shown that the cost of healthcare services in the United States is very high. Although there are many factors that are responsible for high cost of healthcare, ten (10) have been adequately discussed in this article.