Reasons for Rising Health Care Costs

Table of Contents

Introduction1

Reasons for rising Health Care Cost1

Major Factors of rising health Care Cost1

What can be done?3

References4

Reasons for Rising Health Care Costs

Introduction

The health care spending have risen from $256 billion in 1980 to $2.6 trillion in 2010 alone in United States (Centers for Medicare and Medicaid Services, 2012). The prices of health care have increased faster than projections last year and also uninsured people are increasing which is making the bells of danger ringing in the face of U.S. goals to expand health care (Wayne 2012). This paper presents the reasons for rising health care costs and spending, and also presents the extent of problem with some possible solutions.

Reasons for rising Health Care Cost

The reasons for growth in health spending and rising health care cost are diverse and fall in positive and negative domains. Some of the spending on health care can be termed as necessary and life savers, however there are other expenditures as well which are not very effective and have negligible effect on well-being of a person (Sylvester et al. 2009). Also, the increasing demand of health care by economic forces and demographics simply cannot be classified as effective or wasteful.

Major Factors of rising health Care Cost

Below are few important factors deriving the cost of health care:

Technology is raising the cost of health care since they low expensive treatments of diseases not curable earlier and increasing precision comes with a price (kaiserEDU.org 2012). It accounts for 38% to 65% if the growth in health care cost alone (Congressional Budget Office, 2008b).

Insurance is another reason, since people spend lavishly when it is not coming out of their pockets. Since 1965, out of pocket spending has shrunk from 43% to 12% while the health care cost is rising (Centers for Medicare and Medicaid Services, ...