Health Policy Analysis

Health Policy Analyses

Answer-1

Drivers of Higher Health Care Spending

It is apparent that there is a rise in costs when it comes to health care and it must be controlled however when it comes to the driving factors there are different schools of thought which have a different belief in terms of the driving factors that has led to an increase in the health care spending (www.content.healthaffairs.org). Major factors that have contributed to the cost growth are:

Administrative costs: It has been researched that nearly 7 percent of the expenditures of health care are invested in the cost of administration of the government when it comes to the health care programs. Simultaneously, the total cost of private insurance specifically when it comes to profits/losses, administrative costs, taxes as well as reserves. There has also been an opposition in terms of mixed public-private system that develops larger profits and overhead costs that are boosting the spending in health care.

Prescription Drugs and Technology: The expenditure on Technology and Prescription Drugs can be termed as a major contributor in boosting the health spending at a macro level. On the contrary, it has been analyzed that the spending rate on the prescription oriented drugs has deteriorated. Analysts have stated that the premise behind the fueled up health care spending in terms of development costs of the expensive medical technologies but at the same time they also tend have intense demand for such costly services ignoring the lack of cost effectiveness.

Rise in chronic diseases: Due to longer life spans and illnesses at a chronic level; there has been a greater demand of health care system which has been estimated to account for 75 percent of expenditures in terms of national health when it comes to the treatment of chronic disease. It has also been noticed that there has also been an increase of obesity which in turn leads to a rise in obesity oriented chronic diseases eventually impacting the health care spending. The dynamism of illness has said to spark an interest in the crucial role of controlling costs (www.kaiseredu.org).

Impact of ACA

The impact of ACA entails government failure and the health insurer regulations in terms of practices and premium. There will be higher price transparency and competition when it comes to the policies of insurance via exchanges of health insurance. Implementation of payment reforms that is said to be aimed at the reduction of payments ...