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As a manager in the health care division, I would like to give you all the insights in to the current US healthcare system. As per our previous analysis,you might have understood the Medicare program in detail. So now let me explain you all about the current status of US health care system. Current status of nation’s health care: Healthcare will grab more and more headlines in the U. S. in the coming months. Any service that is on track to consume 40 percent of the gross national product of the world’s largest economy by the year 2050 will be hard to ignore.

Business management already feels the effects of healthcare costs more acutely than most consumers. Several recent studies and proposals shed light on the problem and possible solutions. They leave us with questions, too. http://hbswk. hbs. edu/item/5645. html 1. There has been a dramatic slow-down in annual health care spending growth. 2. Yet even with the slow-down, health care spending is at an all-time high, and the United States continues to spend much more than other countries without achieving better outcomes.

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3. Health care spending will continue to grow faster than the economy and threaten the fiscal health of the United States. 4. There has been significant improvement in several key measures of population health 5. Many Americans continue to experience major barriers to needed medical care. 6. Many millions still do not have health insurance 7. Health reform is beginning to reduce barriers to care for millions. As a direct result of the Affordable Care Act of 2010 (ACA) 8.

There has been a substantial increase in the number of primary care physicians, and other health professionals in designated fields experiencing shortages, who are receiving scholarships and loan forgiveness through the National Health Service Corps (NHSC), resulting in improved access to care for millions of people in medically underserved communities. http://www. acponline. org/advocacy/events/state_of_healthcare/snhcreport12. pdf Role of government in US health care: The federal and state governments are the largest supporters of health care services in the United States.

Examples of support that our government provides include assisting those who are in need of health care with numerous options such as Medicare and Medicaid, the employment of millions of people, and billions of dollars each year for new discoveries, treatments, and cures. To start off, the government does indeed offer great assistance with programs such as Medicare and Medicaid, two of the largest programs that the government is involved in. Medicaid serves low-income families, and Medicare is for those that are sixty-five years or older, as well as those that are disabled.

Medicare is the “second largest segment of the federal budget, second only to Social Security payments” (Manning) . Medicare alone covers about 45 million people, with 38 million being 65 or older, and the other 7 million being disabled. Medicare is “funded by the federal government as well as individual contributions from beneficiaries for premiums, copayments, and coinsurance” (Jaffe). On the other hand, Medicaid covers about 61 million people and is paid for by a combination of federal and state funds. http://www. studymode. com/essays/Government-s-Role-On-Health-Care-1044804. html National health care spending in 2002 was $1.

55 trillion, 14. 9 percent of GDP. By comparison, the manufacturing sector constituted only 12. 9 percent of GDP. Adjusted for inflation, health care spending in the United States increased by nearly 102 percent over the 1993-2002 period. Hospital services reflect 31 percent of spending; professional services, 22 percent; and drugs, medical supplies, and equipment reflect nearly 14 percent. David Cutler and Mark McClellan note that between 1950 and 1990 the present value of per person medical spending in the United States increased by $35,000 and life expectancy increased by seven years.

An additional year of life is conventionally valued at $100,000, and so, using a 3 percent real interest rate, the present value of the extra years is $135,000. Thus the extra spending on medical care is worth the cost if medical spending accounts for more than one-quarter ($35,000/$130,000) of the increase in longevity. Researchers have found that the substantial improvements in the treatment of heart attacks and low-birth-weight births over this period account, just by themselves, for one-quarter of the overall mortality reduction. Thus, the increased health spending seems to have been worth the cost.

5 This does not mean that there is no moral hazard. Much spending is on things that have no effect on mortality and little effect on quality of life, and these are encouraged when the patient pays only a fraction of the bill. Investment in healthcare: When deciding on a healthcare company in which to invest, keep the following prevalent trends in mind. Changes to or continuations of these trends can have implications for a variety of areas within the healthcare sector.

Positive trends include: * the aging population and the baby boomers * people living longer with chronic disease * obesity and diabetes epidemics * technological advances * the global reach of disease * personalized medicine Negative trends include: * a single-payer system (Medicare/U. S. government) * expenditure as an increasing share of gross domestic product (GDP) * the uninsured * cost controls * consumerism Preventing Chronic Disease:

A Smart Investment * Chronic diseases – such as heart disease, cancer, stroke, and diabetes – are responsible for 7 out of 10 deaths among Americans each year. They account for 75% of the nation’s health spending.

Focusing on prevention can both improve the health of Americans and help control health care spending. In fact, a report from Trust for America’s Health entitledPrevention for a Healthier America concluded that investing $1 in proven community-based programs could yield a return of $5. 60. * The Prevention Fund helps states tackle the leading causes of death and root causes of costly, preventable chronic disease; detect and respond rapidly to health security threats; and prevent accidents and injuries. With this investment, the Affordable Care Act helps states and the nation as a whole focus on fighting disease and illness before they happen.

* Since the Affordable Care Act was passed in 2010, the Department of Health and Human Services has awarded $1. 25 billion in Prevention Fund grants. http://www. healthcare. gov/news/factsheets/2011/02/prevention02092011a. html Venture Investment In Health IT: A Bright Spot 0 comments, 0 called-out + Comment now In sharp contrast to an 18% drop in overall venture investment in the first quarter of 2012, health IT companies raised $102 million—a 75% increase over the same period last year, according to Dow Jones VentureSource.

The main drivers continue to be government subsidy of electronic health records, and the move toward so-called accountable care organizations, which reward hospitals and doctors based on patient outcomes. The number of deals remained flat at 18, however, as more money flowed into existing portfolio companies, which included clinical decision support software, bioinformatics, and health care administration software. The latter represented the largest number of deals (9), followed by 4 in clinical decision support software.

“We’re seeing a dramatic shift from biopharmaceuticals to these sectors,” says Jessica Canning, global research director for Dow Jones VentureSource. Investments in biopharma were down 46% during the same period. Here’s the Dow Jones VentureSource top 4 health IT ranking: 1- Kinnser Software, Austin, Tex. Sells management software to home health agencies. Founded in 2003, it raised $40 million in March in a first round from Insight Venture Partners. 2- PerfectServe, Knoxville, Tenn. Sells tools to facilitate clinical communication among health care providers. Clients include Catholic Healthcare West and St.

Jude Medical Center. Founded in 1997, it raised $10. 9 million in February in a Series C round, led by Piper Jaffray; investors included National Healthcare Services (investment arm of MemorialCare Health System), and CHV Capital (investment arm of Indiana University Health System). Existing investors River Cities Capital Funds, Spring Mill Venture Partners and Village Ventures also participated. 3- Truveris, New York, NY. Manages pharmacy benefit plans and tracks claims payments for prescription drugs. Founded in 2009, it raised $10 million in a second round in February, led by New Leaf Venture Partners;

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