US Healthcare System Overview
What causes the US healthcare system to be so expensive?
Over the past decade healthcare costs have more than tripled in the United States. Deductibles have gone from three hundred dollars in 2006 to over one thousand dollars today before insurance even takes effect (Levey, 2015). The source of the price increase has been brought about by many factors. From deteriorating health of employees, minimal wage increases, and compensation to supplement uninsured individuals, American citizens are forced to pay more out of pocket costs for healthcare than ever before.
As obesity has become an epidemic in the U.S. healthcare costs have sky rocketed to combat the chronic diseases that are a result of obesity. High blood pressure alone costs the nation 47.5 billion dollars a year in direct medical costs (Stinson, 2013). With chronic diseases costing employee sponsored healthcare billions of dollars each year, many corporations now offer health and wellness incentives to encourage employees to take control of their health thus abating the needs for long term medications and decreasing healthcare costs for businesses. Inactive employees spend an extra fifteen hundred dollars per year on health related issues, while employees who participate in wellness programs can save more than three hundred ninety dollars per year on their health care premiums (Fuscaldo, 2010). Obesity is crippling the healthcare system; however with these incentives in place healthcare costs may eventually be lowered.
Rising healthcare costs are not only affecting businesses, but employees as well. With the rising cost of health care, employees see minimal wage increases. With many companies still paying the bulk of their employees’ insurance plans, many corporations simply cannot afford to offer raises. On average, employer sponsored healthcare paid five thousand dollars for a single person plan and over twelve thousand dollars for a family plan (Levey, 2015). Having paid such exuberant prices, most employers do not have the means to increase wages. This leaves most employees struggling to pay high deductibles and copays, thus making the cost of healthcare even more expensive on a modest budget.
High health insurance costs are not just limited to the work place. Those who do not receive employer sponsored healthcare usually are faced with high deductibles through government sponsored programs. The Affordable Care Act was designed to provide affordable healthcare options; instead most individuals are faced with an unrealistic deductible. The LA Times reported that the average deductible for a silver plan option through the Affordable Care Act is over two thousand dollars (Levey, 2015). In order to provide healthcare for the uninsured, healthcare costs have risen as a way to compensate for lowered priced plans. Since it is mandatory for all citizens to have healthcare, insurance companies charge higher premiums to businesses to combat the cheaper plans through the Affordable Care Act. The LA Times reports that as soon as 2018 a so called “Cadillac Tax,” could be implemented causing corporation with high quality health plans to pay a higher percentage in taxes (Levey, 2015).
As American citizens we can continue to place blame on who we believe to be responsible for soaring healthcare costs, however, if we do not act on these accusations we will be struggling to pay impossible prices. If we do not implement change to this broken system, healthcare will cease to exist as an affordable amenity to any American.
- Fuscaldo, Donna. “Wellness Programs Lower Insurance Premiums.” Bankrate. Bankrate Inc., 25 Mar. 2010. Web. 25 Apr. 2016. <http://www.bankrate.com/finance/insurance/wellness-programs-lower-insurance-premiums-1.aspx>.
- Levey, Noam N. “Healthcare Law Helps Sickest Americans–depending on Their State.” Los Angeles Times. 19 July 2015. Web. 25 Apr. 2016. <http://www.latimes.com/business/healthcare/la-na-obamacare-cancer-20150719-story.html>.
- Stinson, Sonya. “The Cost of Chronic Disease.” Bankrate. Bankrate Inc., 9 Aug. 2013. Web. 25 Apr. 2016. <http://www.bankrate.com/finance/insurance/cost-of-chronic-disease-1.aspx>.
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