Economy and U.S. Health Care Essay

Total Length: 938 words ( 3 double-spaced pages)

Total Sources: 4

Page 1 of 3

The Affordable Care Act (ACA or Obamacare) witnessed a twenty-five percent growth in insured individuals. But the above growth was accompanied by a concurrent sharp rise in insurance companies’ premiums. Furthermore, it led to a tremendous healthcare sector burden, increasing the nation’s budget twofold, from 1.3-2.5 trillion dollars according to 2009 estimates (Tuller, 2017). The above phenomenon constituted a gross domestic product increase of 3.8 percentage points (pps.), committed to America’s healthcare sector. In Tuller’s (2017) opinion, the healthcare structure is a “hidden thief” that may be held accountable for no appreciable rise in the wages of the average worker. Kellerman and Auerbach (2017) contend that swiftly growing healthcare expenditure may end up harming the nation’s economy by bringing about employment and GDP declines and a growth in inflation.



Greater national expenditure adversely impacts economic development, to a considerable extent. Rise in workforce health insurance premiums has deterred investors from investing in the US and led them to turn their attention to Canada and other such economies having appreciably lower employer premium burdens. In sectors like the automotive sector, employee insurance at the time of manufacturing an automobile stands at 1,300 dollars, which is costlier as compared to the steel that forms the automobile’s body. This sort of huge premium decreases companies’ earnings following taxes and the overall income earned for each household.
This coerces the government to minimize infrastructural development spending, diverting those resources towards managing the nation’s healthcare budget.



Governmental healthcare spending’s benefit-cost is rather generous. Healthcare improvements lead to increased labor market productivity and an increase in working hours. Further, avoidable mortality rates are reduced and healthcare personnel’s earnings increase. But the growth in spending as compared with the remaining major economies in the world that depict considerably lower healthcare spending suggests an insignificant general health performance gap. Canada, which displays around 50% of America’s healthcare spending, has witnessed an automobile sector growth of 1.3 percent owing to Michigan-based producers’ shift to Ontario, Canada.



The huge healthcare burden may be attributable to the application of CT (computed tomography) scans, MRIs (magnetic resonance imaging) and the plethora of other such expensive technology that has hit the markets in the course of the past ten years. Some proofs exist of governmental cutbacks on health spending through decreasing provider reimbursement, spending on other economic spheres, and public insurance generosity and entitlement, in….....

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References

Auerbach, D., & Kellermann, A. (2017). Accelerating Health Care Costs Wiping Out Much of Americans' Income Gains. Rand.org. Retrieved 9 November 2017, from https://www.rand.org/pubs/research_briefs/RB9605.html

Fuchs, V. (2013). The Gross Domestic Product and Health Care Spending. New England Journal of Medicine, 369(2), pp.107-109.

Health Care | U.S. Bureau of Economic Analysis. (2017). Blog.bea.gov. Retrieved 9 November 2017, from https://blog.bea.gov/category/health-care/

Podesta, J. (2017). Inclusive Economic Growth: Increasing Connectivity, Expanding Opportunity, and Reducing Vulnerability - Center for American Progress. [online] Center for American Progress. Available at: https://www.americanprogress.org/issues/economy/reports/2013/02/07/52160/inclusive-economic-growth-increasing-connectivity-expanding-opportunity-and-reducing-vulnerability/ [Accessed 11 Nov. 2017].

The Effect of Health Care Cost Growth on the U.S. Economy. (2017). Aspe.hhs.gov. Retrieved 9 November 2017, from https://aspe.hhs.gov/system/files/pdf/75441/report.pdf

Tuller, D. (2017). How Health Care Is Hijacking the U.S. Economy. @berkeleywellness. Retrieved 9 November 2017, from http://www.berkeleywellness.com/healthy-community/health-care-policy/article/how-health-care-hijacking-us-economy
Wang, F., Wang, J. and Huang, Y. (2017). Health expenditures spent for prevention, economic performance, and social welfare.

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