THE RISING COSTS OF HEALTH CARE AND SERVICES By: Jerry Buissereth

WHY THIS TOPIC?• I am a firm believer in that everyone deserves health care.• If a person is sick and there are people out there that can help treat

them, then that should be enough for the person to get treated.• Unfortunately, in the United States there are a bunch of other things that

come into play.• One of the main points that prevent people from being able receive care

are the costs of the health care services.

WHY THIS IS IMPORTANT TO HEALTH CARE?

• People cant afford to go to the doctors and get treated.

• That leads to people avoiding doctors for themselves and their families.

• That could lead to them getting a lot more sick than if they were able to have gone in earlier.

• That could also lead to disease spreading more quickly and putting a bigger burden on the hospitals when those people do finally come in.

RISING COSTS HISTORY• In 2014 U.S health care spending increased 5.3 percent following growth of

2.9 percent in 2013 to reach 3 trillion or $9,523 per person.• Hospital care- spending for hospital care increased 4.1 percent to 971.8

billion in 2014 compared to 3.5 percent growth in 2013. The increase in growth in 2014 was influenced by a reappearance in growth of non price factors, such as the use and intensity of services.

• Physician and Clinical Services- Spending on physician and clinical services increased 4.6 percent in 2014 to $603.7 billion from 2.5 growth in 2013 when spending was a historical low.

https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/downloads/highlights.pdf

RISING COSTS HISTORY• Prescription Drugs- Retail prescription drug

spending accelerated in 2014, growing 12.2 percent to $297.7 billion compared to the 2.4 growth in 2013. The rapid growth in 2014 was due to increased spending for new medications.

• Other Health, Residential, and personal Care Services- These services spending increased 4.1 percent in 2014 to 150.4 billion.

https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/downloads/highlights.pdf

HEALTH CARE IN OTHER COUNTRIES

• The United States health care system is the most expensive health care system in the world.

• That does not mean they are number one in rankings.

• The US actually ranks 11th among other wealthy nations, France, Australia, Germany, Canada, Sweden, New Zealand, Norway, the Netherlands, Switzerland, and the U.k.

• Based on quality of care, access to doctors, and equity throughout the country.

• Hellmann, M. (2014, June 17). U.S. Health Care Ranked Worst in the Developed World. Retrieved December 01, 2016, from http://time.com/2888403/u-s-health-care-ranked-worst-in-the-developed-world/

WHY ARE COST RISING?• Chronic Diseases- half of all adults in U.S have at least one chronic

disease such as heart disease, cancer, and diabetes. • The population is getting older, so more people are in need of health care

services. • Chronic diseases contribute to rising health care costs because they are

expensive to treat. • 86% of all health care spending is for patients with a chronic disease. • Taube, S. (2016, January 12). What's Driving Rising U.S. Healthcare Costs? - United States

Common Sense. Retrieved December 01, 2016, from http://uscommonsense.org/research/whats-driving-rising-u-s-healthcare-costs/

WHY ARE COSTS RISING?• Unmanaged Pricing- prices for drugs and

hospital services are rising quickly and faster than overall health spending's. Patients and providers are commonly unaware of how much drugs and services cost before agreeing to pay for them.

• Administrative Obligations- administrative costs are the biggest toll when it comes to health care spending.

• The cost to administer the Affordable Care Act alone estimated at $273.6 billion.

WHY ARE COSTS RISING?• Over Treatment- occurs when physicians and patients request

unnecessary tests and treatments.• Fee for service healthcare payment model: provides payment for each

visit, test, or procedure. So patients can be ordered more than needed services and physicians and hospitals make more money.

• Fear of malpractice lawsuits: physicians fear getting sued so they order more tests and services on patients.

WHY IS THIS IMPORTANT TO A HEALTHCARE ADMINISTRATOR?

• As a health care administrator you want to give the best quality care to your patients.

• This includes the best prices for services as well.

CHALLENGES FACING THE HEALTHCARE ADMINISTRATOR

• Patients complaining about high costs of the services. • Physicians and other health care providers requesting raises probably due

to increase in patients. • Lowering costs would mean physicians salaries would be decreased or

increasing their salary would mean higher cost for services.• Having higher salaries for healthcare providers could lead to not being

able to afford adequate staff. • Having to follow new ACA regulations costs money which could increase

prices.

WHAT TO DO AS A HEALTHCARE ADMINISTRATOR

• Hold staff meetings to discuss the changes brought on by the ACA and hold trainings so all staff becomes familiar with changes and what needs to be done. This will help hold costs to the minimum in terms of the ACA.

• Make sure ALL physicians, nurses and other staff are happy so they don’t feel it necessary to ask for salary increases.

• Make customer service a number one priority in the department or hospital.

• Having patients feel satisfied will make them feel better when it comes to paying the costs for the services they received.

• Have the most up to date equipment as this will help decrease the number of times a test or procedure needs to be done, and give better outcomes.

RECOMMENDATIONS• As a health care administrator I would make it my priority and my staffs

priority to always put the patients first and to never turn down or treat a patient differently based on their ability to pay.

• Having that understanding among staff would allow room for learning as a group (the department, or hospital) on ways to decrease cost or ways to increase staffing salary.

QUIZ!• http://whatifpost.com/health-care-quiz

VIDEO!• https://www.youtube.com/watch?v=Ro56CoQ7GoY

• https://www.youtube.com/watch?v=LOGyKz6NSxE

REFERENCES • 1. Hellmann, M. (2014, June 17). U.S. Health Care Ranked Worst in the

Developed World. Retrieved December 01, 2016, from http://time.com/2888403/u-s-health-care-ranked-worst-in-the-developed-world/

2. https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/downloads/highlights.pdf3. Taube, S. (2016, January 12). What's Driving Rising U.S. Healthcare Costs? - United States Common Sense. Retrieved December 01, 2016, from http://uscommonsense.org/research/whats-driving-rising-u-s-healthcare-costs/