Increasing Health Care Costs: What you need to know

US Citizens pay more than 1.5 trillion dollars for medical care every year and costs associated with all manner of health care, such as prescription drugs, continue to skyrocket. While a few of the reasons behind this booming bill are comprehensible, Americans caught in a cash crunch may be surprised to find out some of the lesser-known causes of escalating health care costs.

The phrase health care may invoke images of doctors, nurses and hospitals, but the reality is that the medical field is an industry and a pitiless one at that. Individual practitioners, researchers and participants may have marvelous intentions and a genuine need to help people, but the structure of the US health care system assures profit is the highest issue of importance.

Here are some facts that could help explain the escalating costs of American health care:

Pharmaceutical research and development companies expend approximately $20 billion each year on Research and development, and approximately a similar amount on advertising and self-promotional marketing activities.

Also, drug companies have as many sales persons as there are doctors in the United States. One of the responsibilities of this sales force is to convince doctors to attend pharmaceutical company-sponsored seminars where drugs are showcased.

According to some economists, the acquisition of new technology is responsible for more than 50 percent of new health care spending over the previous three years.

A great deal of the money North Americans pay for health care finds its way into the spiraling profits on health care-related products and services such as the provision of medical insurance. Even greater costs have been envisaged for the future, particularly for prescription drugs.

For many US Citizens who are unable to afford the health care they need, spiraling prices represent an ever-increasing barrier to medical services and products. The financial burden is also found on the larger national scale with about fifteen percent of gross domestic product going toward health care costs. That is equal to around a quarter of the annual federal budget.

Relatively, Canada invests in the area of 10 percent of its Gross domestic product on its public health care program. Unlike the U.S.A., Canadas health care program is universally available to all citizens and permanent residents without cost. Other countries, such as Germany, in which there is a public/private delivery system model for health care, manage to serve their populations for even less whilst still having better longevity than Americans. This proves that the quality of health care does not increase proportionally with the amount of money spent to achieve it.

While many Canadians supplement their overall health care with added insurance to the cost of medication and benefits such as semi-private or private hospital rooms, health care insurance is much more necessary in the United States. Unfortunately, costs have been spiraling dramatically, making health care insurance inaccessible for many Americans. Presently, more than forty million Americans do not receive any type of health care benefit.

For employers, offering health care insurance for workers is also becoming more expensive, with increases dramatically outpacing inflation rates. Some years, the difference is four or six fold. Even if premiums were to remain static, providing health care insurance to workers still costs several thousand dollars per worker. For smaller companies, or for those who employ a large number of people, these costs can be prohibitive.

Measures to shrink health care costs are always under consideration, though many are not popular choices. Suggestions that have been raised by various sources have included:

Increased drug awareness and education. Millions could be saved if health care insurance covered only generic variations of drugs that have been found to be just as effective as their more expensive brand name counterparts.

End expensive treatment alternatives will only add a small amount of time to a patients life, particularly if it will not be quality time (i.e. patient is in a coma).

Promote preventative care such as smart lifestyle choices, proper nutrition and exercise.

Examine ways to control drug advertising to consumers. There is supposition that advertising has led to prescriptions of non-necessary drugs.

Restrict malpractice liability so doctors and medical professionals do not feel forced to cover themselves by ordering unnecessary diagnostics to substantiate conditions they already know to be present.