Health Care Management – Health Care Cost

Background information

The cost of health care in the United States has increased through the past several years to the present. Kimbuende, Ranji, Lundy, and Salganicoff (2010) affirm that health care expenditures in the U.S. were over 2.3 trillion dollars in 2008. As a result, cutting this growth has become a prominent policy priority, with the government, workforce, and consumers in a constant endeavor to match the increasing health care costs.

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Despite the numerous benefits that Americans get from the various investments in health care, the current fast growth of health care costs together with the economic slowdown and increasing federal arrears is placing a whopping load on the financing of the system health care. Family premiums for employer-supported health coverage have augmented by 131% thereby exerting a rising cost load on employers and employees (Kimbuende, Ranji, Lundy, & Salganicoff, 2010).

This situation is overwhelming to employers because their wages are growing at a relatively slower rate than the cost of health care so many have problems affording out-of-pocket care payments.

The federal and state governments have developed various strategies to contain the unprecedented health care costs. This research discusses the use of managed care towards the mitigation of health care costs. Particularly, it will underscore the impact of rising health costs on the well-being of American families.

Impact of rising health cost

The majority of employees who drop access to employer health insurance enjoy minimal coverage options. Most of them end up in the individual insurance market. Here, coverage is usually unaffordable and occasionally unavailable for seniors or people in need of care (Commonwealth, 2006, p.3). On the other hand, families that maintain employer coverage, experience ever-rising deductibles, as well as other cost-sharing, are increasingly consuming a large portion of family income. This especially affects families with low or modest incomes.

Many adults who want to purchase insurance coverage using individual markets ultimately do not buy a plan, because they find it difficult or impossible to get one that satisfies their expectations or is cost-effective. Then again, adults with entity market insurance grant their health plans a lot lower ratings, face increased deductibles, pay more out-of-pocket on premiums, and spend a larger proportion of their earnings on health care expenditures and health insurance premiums.

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Increasing health cost is adversely influencing the wellbeing of many American families. Only 34 percent of the 8.5 million Americans who have been covered via the entity insurance market rate their coverage as exceptionally praiseworthy or excellent against 54 percent under employer coverage. Policymakers often find themselves pondering over what stakeholders of the system can do to alleviate costs.

Managed care

The beginning of a novice administration and the economic recession provides an opportunity for health care restructuring and for containing health care costs. Nevertheless, the past struggles to manage health care costs have not had a substantial long-term effect, sparking a debate on what approaches can consistently lower costs. Managed care that signified a swing towards increased control over the consumption of services initially appeared to generate savings with its widespread adoption through the 1980s and 1990s. However, the big question remains, can managed care achieve this objective?

Many people believed managed care could help mitigate a load of health care costs for not-so-fortunate Americans. This alternative for containing health care costs took a drastic turn when many people enrolled for Medicaid-managed care in 1996 (Lillie-Blanton & Lyons, 1998, p. 238). This alternative is favorable for many poor and sick Americans.

Characteristics of Managed care beneficiaries

People who enroll in this program possess unique characteristics. Lillie-Blanton & Lyons affirm that two-thirds of Medicaid recipients and over half of low-income, privately insured individuals were in managed care programs in 1995 and 1996 (2008, p. 240). Therefore, managed care in some way helps poor Americans access health care.

Seventy percent of the Medicaid managed care recipients were poor according to the federal poverty standard, while 28 percent did not go beyond 12 years of education, and 45 percent worked part or full time. On the contrary, only 22% of low-income privately insured managed care recipients were poor, 9% had an education of fewer than twelve years, while 84% worked. Managed care program recipients possessed varied socioeconomic characteristics.

Benefits of managed care

Most of the aforementioned beneficiaries of managed care were previously enrolled in their recent health plan for a comparatively short time, less than two years. In addition, there was more likelihood of insurance lapse in Medicaid managed care recipients, with 36 percent experiencing a lapse in their respective coverage within the past two years, relative to 21 percent of their low-income counterparts with private coverage.

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Managed care has helped many Americans access health care. Many managed care beneficiaries did not have a regular health care practitioner from who they sought care after falling sick (Lillie-Blanton & Lyons, 1998, p. 242). The authors affirmed that about one-third of managed care collective enrollees did not have a regular care provider. The high cost of health has reduced access to health for many Americans.

Because of the high cost of care, a considerable amount of people do not access care, such that they stay with their sickness until they get so miserable. As a result, so many managed care enrollees report having visited an emergency room (Lillie-Blanton & Lyons, 1998, p. 243). Managed care beneficiaries were more likely to rate their health services as fair or poor.

Conclusion

Health care management intervention is not straightforward in addressing the costs of health care. Although poorer and sicker Americans enroll in Medicaid and managed care, they do not get full and equal care compared to their counterparts. Therefore, policymakers should consider another alternative to contain health care costs.

Reference list

Commonwealth. (2006). Squeezed: Why rising exposure to health care costs threatens the health and financial well being of american families. Medical Benefits, 23(22), 3-4. Web.

Kimbuende, E., Ranji, U., Lundy, J., & Salganicoff, A. (2010). U.S. Health care costs. Web.

Lillie-Blanton, M., & Lyons, B. (1998). Managed care and low-income populations: Recent state experiences. Health Affairs, 17 (3), 238-247. Web.

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