Paper on Analyzing U.S. Healthcare Costs: Factors, Challenges, and Nurses' Role in Cost Containment

Introduction

Despite being technologically advanced, the healthcare services in the United States remain to be expensive. In 2018, the total healthcare expenditure was approximately $3.6 trillion, meaning that the country's healthcare is higher than any other country globally (Schreck, 2020). Also, the proportion of the gross domestic product (GDP) spent on healthcare is higher than any other country in the world. In 2018, 16.9 percent of the GDP was spent on healthcare in the US, compared to Switzerland, at 12.2 percent, and the European countries spent an average of 11 percent ‌ (Schreck, 2020). The high expenditure on health care can be associated with several factors, including funding sources, reimbursement methods, economic factors, business influences, cost containment, and nurses’ role as discussed in the paper.

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Funding sources

Most healthcare funding is sourced from government expenditure, which is sourced from taxation, community contributions, and insurance premiums. Funding sources form one of the most significant factors, as the resources allocated determine the quality of care provided. These resources also determine the methods that the practitioners can use, including healthcare technological infrastructure. Alternatively, private funding through insurance contributes significantly, as it enables individuals to cater for their health spending, thus reducing the expenditure amount of the State (Committee on Public Health Strategies to Improve Health & Institute of Medicine, 2012).

Reimbursement Methods

Healthcare institutions receive reimbursement from the government through programs such as Medicaid and Medicare, ensuring that the hospitals are adequately compensated to address the patient’s cost of care (Bruen et al., n.d.). Efficient disbursement programs enable hospitals to take care of their patients without financial strains. The practice reduces the burden of the associated health care expenses, with the Affordable Care Act methods assisting the workers with their health insurance premiums (Bruen et al., n.d.). However, this does not reduce healthcare costs, as the hospitals' total spending remains the same.

Affordable Health Care

Affordable health care (ACA) has assisted millions of citizens in gaining affordable health insurance plans. It is the best solution for Americans since it protects individuals with pre-existing terminal conditions who are the biggest spenders. It has also expanded the insurance coverage to a sizeable population, meaning, if funded well, the Americans will be covered bringing the out-of-pocket payment down.

Economic Factors

The existing economic condition influences the quality of healthcare. In a booming economy, there exist sufficient funds that can be directed to healthcare, thus enhancing the delivery and vice-versa (Swain, 2016). When individuals are economically stable, it means that they can be able to meet their health care costs or better insurance programs that enable them to access the best care, and also increase the government earnings through taxation, translating to more spending on critical state factions (Swain, 2016).

Socioeconomic Factors and Health Outcome

There exists a strong relationship between the socioeconomic status of individuals and the associated outcome. Factors such as income, employment, and social support substantially affect how well an individual lives (Swain, 2016). For instance, if employers provide good income it determines housing, childcare, medical care, and education, all of which translates to enhanced health outcomes (Swain, 2016). Alternatively, low income or unemployment reduces the choices, leading to individuals abandoning some critical areas such as health to cater to more urgent needs leading to distress in times of healthcare need.

Business Influences

As a business, the healthcare system is subjected to the same fundamental issues that affect any business model. For cost efficiency, the medical institution requires leaders who understand the policy issues and the consequences (Volpp, 2012). The leaders must also understand the critical balance between business acumen, medical judgment, and nimble problem-solving skills. Lack of these qualities may lead to mismanagement, service unaffordability, and lack of practical planning.

Cost Containment and Role of the Nurses

Cost containment means controlling the spending associated with healthcare. One way of achieving this is through the nurses since they are the most expensive group in a hospital as they constitute the highest percentage of healthcare workers. Nurses play a critical role in assisting institution's cost-efficiency through how they deliver their services and the corresponding patient recovery. Exceptional services mean that the patients recover more quickly, thus reducing the associated care costs. The reduced patient cost means that the savings can be used to compensate them or develop enhanced systems, that will further enhance healthcare delivery.

Conclusion

Healthcare is a human right and not a privilege. Poor health exposes an individual to life-threatening situations, which contravenes their ability to work, get an education, or participate in positive economic activities. As such, the governments must do everything possible to ensure that every individual access this critical right. In America, an ideal healthcare system is the highest achievable standard that addresses all the fundamental rights of an individual, accessible, affordable, and without discrimination based on demographic factors, economic, or socio-economic factors. Such a healthcare system can be achieved through sufficient and efficient funding systems and sources, using the best business practices, including enrolling business minds that are health conscious, cost containment, and improving reimbursement methods. Better economic policies are also critical as they will ensure growth meaning the government will have more funds to allocate to critical factions.

References

‌Schreck, I., R. (2020, March) Overview of Health Care Financing - Fundamentals. MSD Manual Consumer Version. https://www.msdmanuals.com/home/fundamentals/financial-issues-in-health-care/overview-of-health-care-financing

Committee on Public Health Strategies to Improve Health, & Institute of Medicine. (2012, April 10). Funding Sources and Structures to Build Public Health. Nih.Gov; National Academies Press (US). https://www.ncbi.nlm.nih.gov/books/NBK201025/

Bruen, B., Docteur, E., Lopert, R., Cohen, J., Dimasi, J., Dor, A., Neumann, A., & Desantis, R. (n.d.). The impact of reimbursement policies and practices on healthcare technology innovation final report | February 2016. https://aspe.hhs.gov/system/files/pdf/188741/ImpactofReimbursementonInnovation.pdf

Swain, G. R. (2016). How does economic and social disadvantage affect health. Focus, 33(1), 1-6. https://www.irp.wisc.edu/publications/focus/pdfs/foc331a.pdf

Volpp, D. A. A., and K. G. (2012, September 13). What Is the Business of Health Care? Harvard Business Review. https://hbr.org/2012/09/what-is-the-business-of-health‌