Insurance based markets have unstable prices mainly because hospitals and private institutions overcharge patients who are well insured. Private healthcare insurance, mainly through employers, is higher than anywhere else in the world. Unfortunately, the United States does not negotiate with our healthcare providers aggressively enough thus leading to providers charging exorbitant …show more content…
We pay more but aren’t living longer nor are our health outcomes superior.
Many believe that the cause of high health insurance premiums is from Americans being unhealthier that other countries or that high malpractice occurrence are high which in turn leads to physicians ordering patients to get unnecessary test in order to cover themselves from malpractice. This practice is also known as defensive medicine. Unnecessary healthcare provided with a high volume or cost is not appropriate. Data shows that Americans do not go to doctors more than other countries nor do Americans utilize hospital stays. Since we have fewer smokers and less alcohol consumption than Ireland and France, it shows that disease prevalence does not affect healthcare costs. The unfortunate fact is that Americans spend twice as much on healthcare as people in other developed countries, but receive lower quality care and less efficiency.
Since the Affordable Care Act (ACA), also known as Obamacare was signed into effect in 2010, the healthcare industry has seen record growth and increased revenues. The ACA …show more content…
A solution may be to divest in healthcare as a commodity and create universal healthcare or single payer government coverage similar to Medicare. Under our current system, the more you earn the better coverage you can afford. If you cannot afford high premiums or deductibles, you can opt out of insurance and pay a penalty fee. We recognize and accept that the fortunate majority pays to subsidize the unfortunate minority. But with consumer choice, the young and healthy may decide not to buy into insurance or opt out of insurance and this will no longer subsidize the cost of care for the old and sick creating an adverse selection. An example of health insurance markets that began to unravel because of adverse selection in the late 1980s and 1990s include the coverage of mental health care in Federal Employees Health Benefits Program and the NY state and NJ state individual insurance markets. With more doctors jumping ship and healthy patients choosing to take the annual penalty rather than buy extremely overpriced exchange plans, there isn’t much left to prevent a healthcare economic