4 factors that drive up U.S. health care costs
It’s difficult to say whether the Affordable Care Act is a blessing or a curse. On one hand, this type of health care reform means the millions Americans who don’t have access to decent medical resources when they get ill will get health insurance. However, it also means that the cost of health care will continue to rise drastically, and cause those actually paying for medical insurance premiums can expect to pay even more!
The raising costs of health care can be blamed on many different things. For instance, one can point fingers at physicians for their lack of transparency when it comes to the costs of care. While others might blame hospitals and their constant “need” for new and expensive medical technologies for a very select group of patients. Still, many blame the patient who might use their health insurance for things like the common cold when really they could rely on over the counter medication instead of making a health claim.
Regardless, after conducing quite a bit of research, I’ve uncovered four main factors behind the raising costs of healthcare…
Hospital costs add up to almost one-third of U.S. yearly health care expenditures. Those costs, according to the American Hospital Association, come mainly from the goods and services used for patient care—that could be new equipment, medical staff (both nurses, doctors, and those needed for general surgery jobs), regulatory requirements, and IT systems to run operations. When you consider that neither Medicare nor Medicaid reimburse for hospital care, you can see why costs continue to rise to keep them running efficiently.
And particularly those with insurance who insist on covered medical care for something as simple as the common cold cause the price of health care to soar. Why? Because even though a medical prescription or treatment is a “freebie” with no cost consequence from the customers pocket, every time health providers pay out; they’ll set higher premiums and deductibles the following year as the cost increase of doing business.
Even doctors who accept insurance claims need to recoup the higher it takes to keep a practice somehow. So because they are locked into negotiated fee rates with insurers, they look to consumers to make up the difference by adding out of pocket costs not covered by their insurance network.
4. New medical technologies
Advanced technologies, things like robotic surgical arms in 36-percent of US hospitals, definitely improve the quality of patient care in hospitals. However they simultaneously drive up costs for consumers, because they are high-cost procedures that take years of research and development. The costs need to be recouped somehow.