Summary
Sixteen percent of the GDP goes toward healthcare and that number is rising. Any component of the economy that takes such a high percentage bears scrutiny; one that affects overall health and well-being and is so fraught with emotion even more so. First we must ask if portions of this money could be better spent on other resources like education and economic development, both of which have been shown to affect overall health and well-being. Second, we must ask if we are funding the proper services in the proper amount, e.g. prevention vs. intervention. Employers still pay the bulk of health insurance and rising costs have implications for economic viability and employee out-of-pocket expenses. One approach would be to offer a more basic level of coverage which included prevention, primary care and catastrophic coverage. Broader scope coverage could be purchased at the discretion of the employee based on individual needs and resources.
Analysis
In the long run, increasing healthcare costs are going to affect the viability of businesses as health premium costs exceed profitability. This scenario is a formula for disaster no matter what the expense category. Employees also will face the challenge of having to forgo healthcare for other basic necessities or forgo other basic necessities for healthcare.
In the short-run, healthcare providers, pharmaceutical companies, medical equipment manufactures and insurance companies will benefit from taking a portion of this growing GDP number.
Managed care companies will benefit as more is done with less and the need for determining medical necessity becomes even more critical.
