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Healthcare Industry

November 06, 2012
Group owner Richard Martine

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Healthcare Industry

By: Richard Martine   Post Date : November 06, 2012
In 1995, total health care spending in the U.S. was just over $1 trillion. Fast forward to 2010, The U.S. now spends $2.6 trillion on hospitals, nursing home facilities, physicians, dentists, other health care practitioners, outpatient and diagnostic laboratories, home health care services, prescription drugs, durable medical equipment and non-durable medical products. That is a 160 % increase in just over 15 years. Spending on health care now accounts for over 17% of the U.S. Gross Domestic Product (GDP) and according to the Congressional Budget Office, will be 25% of the GDP by 2025 without any changes to federal law. Over 60% of the total spending is driven by hospital care ($814 billion), physician and clinical services ($515 billion) and prescription drugs ($259).

On a per capita basis, the U. S. spent US $8,362 in 2010. In comparison, Canada spent U.S. $5,222; France, U.S. $4,691; Germany, U.S. $4, 668; Japan, U.S. $4.065; UK, U.S. $3,503; Italy, U.S. $3,248 and India, U.S. $54 for each man, woman and child. As a percent of GDP, Canada's healthcare expenditures was 11.3% in 2010 and India's was just 4.1% of their GDP.

Given the relatively high per capita expenditure in the U.S., one may reasonably expect that health care quality measures in the U.S. would be comparably better than these countries. However, this may not be the case. Although, currently there is no generally accepted definition or standard criteria for evaluating health care "quality", these metrics are frequently utilized as indicators of a country' s health care status; infant mortality rate, maternal deaths per 100,000 births and life expectancy. In the most recently concluded decade, the U.S. has either trailed or been amongst the bottom two countries among its developed counterparts list above in each of these measures. However, beauty is in the eye of the beholder. According to a 2011 ABC News poll, among all Americans surveyed, 85% were satisfied with their quality of health care, 83% with their ability to see a doctor, 78% with their ability to see good specialists and 77% with their ability to get the most sophisticated treatments.

There is probably no more contemporary contentious issue than health care reform in the U.S. political arena. The increasing financial burden on many American families due to rising health care costs and a growing share of the population that is not covered by health insurance has not gone unrecognized by those in Washington, D.C. The Obama administration's attempt to deal with the burgeoning costs and accessibility, Patient Protection and Affordable Care Act (ACA), passed by Congress in 2011, in under enormous pressure. The issue is now in the hands of the U.S. Supreme Court which will render a decision during the summer. Irrespective of the outcome, the fundamental problems concerning health care costs will remain. How the U.S. chooses to address these problems over the next several years will influence the country's growth and competiveness and therefore should be of paramount concern to all the citizens.

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