English 101

For your argument essay, you’ll write a 2,000- to 2,200-word research
paper on an issue related to your field of study and future career. In your opinion, what is the biggest problem facing your future
profession, industry, or market? In your essay, you will present the
problem, clearly define and explain the issues, and then identify the
best possible solution.
You should use the third-person point of view. You are writing for an
audience unfamiliar with your topic, so your goal is to use language
your readers are familiar with and can relate to; be sure to define any
technical terms you use.
Research
You are required to use six to eight reputable secondary
sources. Evaluate your sources to ensure that the information you are
using and passing on to your readers is accurate and reliable.
Incorporate evidence from your secondary sources into your plan for
your essay. You’ll need to use parenthetical citation and include a list
of references on the last page of your exam. Refer to the APA style
section in your textbook and the APA style guide in the Writer’s Block
Format your prewriting and essay exams according to the following
instructions. Refer to the sample APA-style essay in your textbook.
1. Start with a title page that includes your
Title
Name
Student ID
Address
Email address
2. Use the header function to insert your page number in the top
right margin of your document.
You do not need to include your essay title in the header.
3. Begin your document on page 2 after the title page.

ANSWER

Rising Healthcare Cost

Introduction

Hospitals and healthcare institutions are among the most vital institutions in offering healthcare services. Hospitals have highly experienced experts and advanced technologies that are all gathered within the unique healthcare setting.  People rely on healthcare services to facilitate, diagnose and cure diseases thus maintaining and improving their body function. Healthcare services have also enabled patients to obtain information about their health conditions and progress. The Healthcare delivery system has changed over the last few decades. The changing patterns of care, new and improved drugs, and improved tests and procedures have led to the development of the healthcare system. However, improved healthcare systems have also led to higher costs of healthcare delivery.  This paper will focus on the rising cost of healthcare, its impacts, and strategies to reduce healthcare costs.

One of the major factors affecting healthcare efficiency is the cost of healthcare. The healthcare cost is highly rising leading to health inefficiencies. The rate of healthcare spending has increased, leading to constant pressure on healthcare systems and hospitals (Probasco, 2018). The massive pressure to reduce healthcare costs has led to mishaps within the healthcare industry. For instance, in the United States, healthcare spending has increased greatly in different categories such as physician services, hospital care, clinical services, prescription drugs, and home healthcare (Probasco, 2018). Healthcare systems have sizable fixed costs, which have made it difficult for organizations to maintain financial flexibility. Healthcare costs continue to grow due to an increase in chronic illness, rising health insurance programs, aging population, increased ambulatory costs, the rising cost of Medicaid, and medicate and administrative burden.

Aging Population

Healthcare is getting more costly due to the growing population. Considerably, as individuals get of age, most of these individuals experience high healthcare spending in both outpatient and inpatient hospital care, dental care, emergency departments, and pharmaceuticals (Dieleman et al., 2017). Ideally, a growing population means that there is an increase in how often individuals use healthcare services. Demographics tend to influence both the consumption of health care as well as the level of healthcare needs in the population.

The aging population within the western culture has spurred attention in the age profiles and distribution of healthcare costs. World Health Organization has linked the elderly population to the rapid increase in chronic conditions such as diabetes, hypertension, arthritis, dementia, cancer, and congestive heart failure that have a great impact on the aging population and the healthcare costs linked to the elderly population. The healthcare cost associated with the aging population is expected to continue growing as the baby boomers get older and requiring more health assistance.

Increased Ambulatory Costs

Ambulatory care entails medical services that are performed on an outpatient basis without admission to the healthcare institution. Ambulatory care has one of the highest margins and fasted growing segments within the healthcare industry. Surveys and commercial claims data indicate that there is significant growth, but the significant opportunity has been influenced by the increasing cost of ambulatory care (Dieleman et al., 2017). The rise of ambulatory care has been linked to health consumerism and new technologies, which are leading influences of outpatient care. Ambulatory care, comprising of outpatient healthcare services and crisis room care, has been on the rise. The ambulatory cost is becoming a great concern as there is a prevalent variation in costs across healthcare settings which has increased the expenditure of ambulatory care.

Administrative Burden

The administrative costs in hospitals refer to the back-end functions within the healthcare system rather than the direct patient care such as medical billing, employment, and documentation. Most of the administrative costs are linked to insurance and billing-related activities (Dieleman et al., 2017). A significant amount of paperwork required related to reimbursement, billing, and duplication tasks is a major component of administrative spending. For instance, claim payment errors and billing errors have contributed to delays and have led to huge healthcare expenditures that have lowered the profitability of health institutions. Marketing-related costs such as campaigns, product marketing, market research, and public relations have increased the costs of healthcare expenditures. Marketing and sales budgets have significantly increased the portion of administrative costs.

Increase in Chronic Illnesses

Chronic illnesses are among the most predominant and expensive health conditions within the United States. There is a growing number of chronic diseases which include hypertension, stroke, diabetes, heart disease, obesity, arthritis, respiratory diseases, cancer, and oral diseases. Considerably, as the world develops, so are some illnesses thriving. The problem of chronic illnesses, such as the cost of health care, has begun to worsen, which is the reason why they are the leading causes of death (Dieleman et al., 2017). Chronic illnesses have been linked to long hospitalization and long-term disability, which have increased the cost of healthcare. They have been among the main drivers of high healthcare costs.

As the population ages with time, the number of individuals with chronic illnesses is rising, which means that the burden of controlling and treating chronic illnesses is on the rise. Ideally, chronic conditions demand great specialists in the emergency departments, which may influence the cost outcomes due to increased training and tools that are needed in the treatment of chronic disease. Therefore, the investment in the prevention and control of chronic illnesses has led to disproportionate health burdens and costs. With regard to findings from the Centre for Disease Control, chronic illnesses have led to more than seventy-five percent of healthcare spending. Relatively, public insurance and treatment of chronic diseases have had a larger portion of healthcare spending.

Rising Health Insurance Premiums

The health insurance premium is the amount of money that individuals pay for their health insurance on a monthly basis. Most of the health insurance costs include coinsurance, deductibles, and copayments. Some of the factors that have led to an increase in the health insurance premiums are the wages for the nurses, physicians, and other hospital staff, doctor charges, cost of technology and medical equipment as well as costly procedures (Amadeo, 2019). For instance, medical providers are being rewarded for doing more rather than being resourceful. Through a fee-for-service system that charges every procedure, test, and visit, the healthcare providers have ordered more services, tests, and procedures than the strictly required, which leads to repetitive procedures, tests, and overtreatment.

Another major effect is that health care is not consumer-centric since most individuals do not pay directly for their healthcare insurance. The healthcare insurance is paid by the employer, which means that most individuals do not check on the treatments and services charged. Therefore, when the insurers incur a surge in benefit costs, they increase the income contribution through raising their premiums which in turn increases the healthcare cost.

Rising Cost of Medicare and Medicaid

Since the introduction of the government programs Medicare and Medicaid, individuals without health insurance can to access healthcare. These programs have been designed to offer low and free healthcare to citizens. However, the health organizations are forced to increase prices on the insured population to make up for the expenditure shortfalls (Amadeo, 2019). The government programs have raised overall demand for healthcare services which has resulted in increased prices. People have continued to misuse low-cost healthcare, which has constantly increased the prices for treatments, modern equipment, and technologies.

Medical service utilization

Healthcare service has been on the rise due to lifestyle changes among individuals as well as the growing population. Therefore, the high demand for medical services has influenced how the health service is received, delivered, and meets the needs of the population (Amadeo, 2019). This has dramatically led to the scarcity of healthcare resources and equipment, thus raising the cost of healthcare. Over the last few years, there has been a growing need to evaluate how healthcare services are being used and how the healthcare systems can be enhanced to meet the increased healthcare needs. The need factors include illness factors and levels that influence changes in healthcare utilization.

Service price and intensity

Intensity and service prices have held the most significant percentage of healthcare spending. Prices have failed to establish the most appropriate way of delivering care due to high healthcare costs. Considerably, the prices for healthcare services vary among the healthcare providers, even for standard tests and procedures, which makes it challenging for the patient to determine their expenses. The service intensity entails the services that patients receive from the healthcare providers (Lyu et al., 2017). The demand for healthcare services has increased due to Medicaid, and Medicaid thus impacts the intensity of healthcare. Overuse of procedures and tests has increased the health care costs and lowered the quality of care, thus exposing patients to unnecessary risks that have burdened them with out-of-pocket expenses.

Inefficiency and Lack of Transparency

Inefficiency and absence of transparency have made it challenging to determine the actual healthcare cost. Patients have been deprived when it comes to a lack of clearness in the cost and price of healthcare services (Dieleman et al., 2017). As healthcare professions, the patients believe that the doctor’s advice focuses on the interest of patient care rather than fiduciary interest. However, competition for market share has influenced the healthcare providers, thus leading to increased inefficiencies and a lack of transparency. Lack of transparency has also led to the dispersion of prices for similar healthcare tests and procedures, influencing the price structure.

High cost of pharmaceuticals

The high cost of pharmaceuticals has threatened the healthcare budgets. One of the major factors leading to the high cost of pharmaceuticals is the seriousness of diseases. For instance, the high cost of prescription drugs is being sustained by the treatments of severe diseases and the vulnerability of patients that demand care and prolonged life. For serious illnesses, families and patients are willing to pay any price to prolong life and save their loved ones.  Therefore, since patients highly rely on a particular medication has raised the medical prices. Patients are giving out of pocket than before due to the increased cost of pharmaceuticals, increasing healthcare costs.

The Impact of Rising Healthcare Cost

Increased healthcare costs will influence the accessibility of care since people choose to avoid care due to the high cost. Reduced access to care will lead to an increase in the prevalence of diseases. This may result in high morbidity and mortality rates. Lack of access and inequality in healthcare services affects the population as well as the patient’s well-being. Ideally, high healthcare costs will lead to financial barriers, which lower the likelihood of individuals being committed to health promotion. High insurance premiums or lack of insurance due to the high cost of premiums may lead to bankruptcy due to expensive treatment plans in case of serious accidents or severe health issues. The difficulties in the access of care may influence the health outcomes through increasing the emotional and physical stress of the patient.

Ways to Lower Healthcare Costs

There is a need to focus on cost-conscious care and look for ways that will save financial resources without having to sacrifice quality healthcare. Considerably, hospitals that focus on reduced healthcare costs are more solvent and stable since it enables them to continue providing high-quality services. Cost-cutting measures have major influences on access to care and how patients receive care. Focusing on reducing administrative costs will demand strategies that reduce both turnover and overtime, as well as automation of healthcare processes to lower staffing. For instance, automating administrative tasks can significantly lower repetitive tasks such as entering patients’ health records.

Healthcare settings and payers can work together to have common technology platforms that will ensure reduced inefficiency through efficient data sharing and flexibility, playing an essential role in improving interoperability and transparency (Pierre-Etienne, 2017). Technology-driven capabilities will lower administrative burdens. Measuring performance and improving quality will play a big role in focusing on patients that need attention and close the quality gaps in care. Improved data sharing between the patient, the health insurers, and healthcare providers will increase transparency focused on cost reduction efforts that will benefit all the stakeholders (Porter, Kaplan, and Frigo, 2017).

Overusing of specialists for treatment and diagnosis makes healthcare very costly. The use of technology will lower the costs incurred for specialists and ensures that specialists spend time where they are most needed. For instance, wearables that indicate the real-time data for patients will be used to manage the health of patients, thus reducing ambulatory costs. There is a need to focus on the elimination of unnecessary expenses and waste that results from excessive testing and procedures that increase the cost of resources. Eliminating waste has been one of the most immediate changes for reducing healthcare costs and improving patient outcomes. To reduce the prevalence of chronic illness diseases, healthcare organizations should focus on programs that will educate the public on healthy living to treat and prevent chronic illnesses.

Conclusion

High deductibles, insurance premiums, and out-of-pocket expenditures are some of the costs linked to health and wellness. The rising cost of healthcare costs has greatly influenced healthcare management and access to healthcare. Some of the reasons behind increased healthcare costs include high administrative costs, aging population, service price and intensity, inefficiency and lack of transparency, high demand of medical services, and high cost of pharmaceuticals. Healthcare costs can be reduced through innovative systems, automation of administrative tasks, and cost-cutting measures such as the reduced need for specialists, multi-professional approach to care, and cost-conscious care. Reducing healthcare costs will promote health and access to care.

References

Amadeo, K. (2019). The rising cost of health care by year and its causes. The balance. Retrieved from https://www.thebalance.com/causes-of-rising-healthcare-costs-406487

Dieleman, J. L., Squires, E., Bui, A. L., Campbell, M., Chapin, A., Hamid, H., … & Murray, C. J. (2017). Factors associated with increases in US health care spending, 1996-2013. Jama, 318(17), 1668-1678.

Liu, H., Xu, T., Brotman, D., Mayer-Blackwell, B., Cooper, M., Daniel, M., … & Makary, M. A. (2017). Overtreatment in the united states. PloS one, 12(9), e0181970.

Pierre-Etienne, B. O. S. T. (2017). Rising Healthcare Spending: Is Technology the Solution?. In Healthcare Engineering (pp. 29-36). Springer, Singapore.

Porter, M. E., Kaplan, R. S., & Frigo, M. L. (2017). Managing healthcare costs and value. Strategic Finance, 98(7), 24.

Probasco, J. (2018). Why do healthcare costs keep rising. Investopedia. Retrieved from https://www.investopedia.com/insurance/why-do-healthcare-costs-keep-rising/