Increasing Health Care Costs: What you need to know

Americans pay more than one and a half trillion dollars for medical care every year and costs associated with all types of health care, such as prescription drugs, continue to rocket. While some of the reasons behind this booming bill are understandable, United States Citizens caught in a cash crunch might be amazed to discover some of the lesser-known reasons for high health care costs.

The words health care can invoke images of doctors, nurses and hospitals, but the reality is that the medical field is an industry and a remorseless one at that. Individual practitioners, researchers and participants may have tremendous aims and a genuine desire to serve people, but the structure of the American health care system guarantees profit is the first issue of importance.

Here are some facts that might assist in explaining the soaring costs of U.S. health care:

Pharmaceutical research and development companies expend roughly twenty billion dollars each year on Research and development, and roughly a similar amount on advertising and self-promotional merchandising activities.

Additionally, drug companies have as many sales persons as there are doctors in the U.S.. One of the duties of this sales force is to convince doctors to go to pharmaceutical company-sponsored seminars where drugs are showcased.

According to some economic experts, the acquisition of new technology is responsible for more than fifty percent of new health care spending over the last three years.

A good deal of the hard cash US Citizens pay for health care finds its way into the increasing profits on health care-related products and services such as the provision of medical insurance. Even greater costs have been envisaged for the future, especially for prescription drugs.

For numerous United States Citizens who are not able to afford the health care they need, spiraling costs typify an ever-increasing impedance to medical services and products. The fiscal effect is also experienced on the greater national scale with about 15 percent of gross domestic product going towards health care costs. That is equal to close to one quarter of the yearly federal budget.

Comparatively, Canada invests in the area of 10 percent of its GDP on its public health care program. Unlike the USA, Canadas health care program is universally available to all citizens and permanent residents without cost. Other countries, such as Germany, where there is a public/private delivery system model for health care, manage to serve their populate for even less whilst still having greater longevity than US Citizens. This proves that the caliber of health care does not increase proportionately with the amount of money spent to achieve it.

While many Canadians supplement their universal health care with extra insurance to the cost of medication and perks such as semi-private or private hospital rooms, health care insurance is much more of a necessity in the United States. Unfortunately, costs have been spiraling dramatically, making health care insurance inaccessible for many Americans. Currently, more than forty million Americans don't receive any type of health care benefit.

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

Steps to bring down 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 training. Millions could be saved if health care insurance covered only generic versions of drugs that have been found to be just as effective as their more expensive brand name counterparts.

Stop expensive treatment alternatives will only add a small period 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.

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

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