Economics

Issues that border on human health have become increasingly controversial in the recent times owing to the fact that for a long time there have remained many challenges regarding their access to health care and their subsequent payment for the services they get. Every person in this country as is everywhere else requires health care once in a while, whether for oneself or for loved ones. The need for health care services has become a mater of controversy owing to the fact that it has been almost half a century now since the last ever health care reforms were put in place in this country, a fact that has made access to health care services, whether medical care or medical aid, a more than complicated endeavor (Cryan 1). Perhaps the greatest controversy has stemmed from the fact that the ability for anyone in the American society to gain access to health care is determined to a very large extent by how well one is able to pay for them, meaning that the rich are in a better position to have access to healthcare than those who do not have as much income.

This has created a situation where all those people opposed to reforms in the health care sector are deemed to be supporters of discrimination based on social class, and the ensuing debate has been ceaseless. The health care sector in this country has for a long time had a lot of problems, many of which have never been addressed fully owing to lack of political goodwill, opposition from some groups with interests in the sector, lack of adequate public and civil society activism, among other factors (The House Committee on Energy and Commerce 1). This paper explores the underlying  problems in this all-important sector, proposes a lasting solution to the problem, and critically assesses the impacts that this solution will have on the various sectors of the economy in general, and specifically on people andor organizations with interests in the  sector like pharmacists, doctors, private insurers, among many other stakeholders. The impacts to the economy of the country are also analyzed with a special focus being placed on how such a solution can be financed.

The Health Care Problem
That this country is among the most populated places in the world is an undeniable fact. What is deniable, instead, is that with such a huge population not everyone can be able to access health care services whenever one needs them. This countrys health care system has remained one that has so successfully managed to remain skewed to favor the interests of a few people, leaving the rest at the mercy of fate as regards their health (U.S. Congressional Budget Office 1). As such, a majority of the people live at the constant dread of falling sick or encountering any problem that might require any kind of health care intervention. This dread has been solely due to the wider problem that access that medical services in the country are very costly and it is virtually impossible for all people who need health care services to afford them. Health care insurance, the way that has been used to solve similar problems elsewhere in Europe and Asia, is also beyond the reach of many Americans. Try as they may, all their efforts to have health care insurance have hit a snag, leaving them exasperated and unable to make sense of the situation.

Although this country is among the leading nations in the world as far as expenditure on health care as a proportion of the Gross Domestic Product is concerned, coming second with about 20 after East Timor, it is hard to understand why it is very difficult for many of its citizens to get access to health care services (Matcha 56). The main cause of the problem can be best understood by considering other developed countries. In the European Union, for instance, health care accessibility is a universal privilege, and is in fact worthy being considered a right because it is unheard of that people are not able to get health care services when they need them. Instead, everyone, especially in the leading industrialized countries like the United Kingdom, France, Germany, and Italy, is in a position to have all forms of health care services because health care insurance in those countries has been made affordable to all people, or at least to the majority (Matcha 56). This is very ironical because the budgetary allocations of these countries to health care are a distant low compared to that of our country. As such, this country is still in need of doing a lot more to help bring about a state where all people are able to get health care services without having to pay at the point where they are to receive such services.

Not that this is an entirely new trend but an old one which has been there for a very long time. The fact that health care in this country is both expensive and those who do access it get poor quality service means that there is a need for a system that is both capable of providing health care affordably but also the health care offered ought to be of the highest quality possible. The closest that this country came in seeking to reform the health care sector was way back in 1965 when Congress passed the compromised bill that gave the seniors in this nation a chance to have access to medical care (U.S. Congressional Budget Office 1). This is the basis of the current Medicare and Medicaid programs which are meant to benefit the people who are above 65 years of age, the very young, and to some extent the needy. However, as has been demonstrated so far, the current situation does nothing substantial to help all the people who need health care services. Instead, those helped are actually people who can afford at least the most basic health care services. Those who are totally not able to have it have been left behind.

The Solution to the Problem
Therefore, more than ever before, this country needs to come out of self-denial and face this problem head-on so as to ensure that health care is affordable to all. The health care problem is deeply embedded in the very fabric of this nations political, economic, and social fabric (Matcha 56). It will take an understanding amongst players in these three sectors to have a comprehensive plan in place which will give all Americans equal access opportunities to health care services. This is because although everyone has admitted to the fact that this country is lagging behind in health care matters when it is supposed to be offering leadership as in many other aspects, the efforts to come up with a sustainable solution have been hampered by constant opposition stemming from the fact that the plan ought to be all-inclusive  giving all people a chance to get any kinds of health care service without having to hurt other people in the process (The House Committee on Energy and Commerce 1). Currently, the main solution that can work for the country is a comprehensive health care plan which allows all people to have compulsory health care insurance offered by the state. Yet this is where the real problem lies, even as it has lain there for a long time.

The solution is that America needs a very comprehensive, all-inclusive health care plan which can enable every citizen to have a way of financing ones health care. The problem has not only been the high cost of health care services but the equally high cost of health care insurance. As it stands, this comprehensive health care plan must at least be targeted at these two factors  reducing the overall coast of medical insurance as well as that of overall health care services in the country. The plan ought to make health care compulsory and affordable to all. There has to be a situation where every employer is expected to pay or contribute a certain amount of money towards this health care scheme, with the remainder of the funds being given by the employee and the government (Matcha 56). It ought to be a kind of cost-sharing approach at health care. There will have to be a doing away of the current restrictions which have seen those who have a lot of money being favored, because the insurance options available are all too expensive to afford. The dominance of the private sector in matters of insurance will have to be done away or significantly reduced. This plan ought to have affordability credits so that those people, who might, for one reason or another, fail to meet the minimum requirements of the set conditions will still be in a position to afford healthcare insurance nonetheless (U.S. Congressional Budget Office 1).

In order to reduce the incidences where healthcare insurance goes to only a certain type of health care procedure, the plan ought to have a case similar to the Japanese one where the government negotiates with physicians from time to time to offer standardized fees for all their services. Such an approach, apart from ensuring that there is no partiality and tendency toward discriminating against those who cannot afford insurance for most or some of the very costly medical procedures, also ensures that overall health care costs in the country are brought down. Health care services in this country have been made to take on a form that classifies them as though they were just like any other goods or services (Cryan 1). Goods and services in the contemporary economic world are not to bee likened to health care services because health is paramount. Therefore, giving health care stereotypes like socialized medicine is all wrong.

Considering a nation like the United Kingdom, it has been very successful in its use of a health care system of the nature referred to here as socialized medicine. The social aspect stems from the fact that the government is the sole provider of health care services, and it is the sole financier as well. All people have to do is pay taxes and they will get the health care services they require. This country has from as early 1906 rejected such a health care system based on the fact that it represented socialist approaches to doing things when capitalism was the way to go and socialism was very unpopular (Matcha 56). Today, the United Kingdom is a good example of capitalist nation which has succeeded in using this so-called socialized health care. While it is true that everything is not workable in this system, this country can borrow certain aspects from the UK. There has to be a lot of government involvement in health care matters, particularly healthcare insurance and service provision. It is time the private sector was made less dominant and its place taken over by the government.

There can be incepted a system that allows the government to regulate all the goings-on in the health care sector. In the past, the AMA has been very instrumental in deciding what goes where and who gets what because it has been doing as it has desired (U.S. Congressional Budget Office 1). There ought to be a system where the government will be in a position to hire doctors and so pay them directly. Those in the private practice can be paid through state and local counties which will determine the percentage of money that each private doctor is to get. Specialized medical procedures can be funded at a fixed rate per given length of time, and any deficits in one period can be covered by budgetary excesses in another. In essence, the private practitioners wild have to expect a  given amount per year or quarter, and in turn they will be expected to deal with all patients who come to them for all kind of  services, as long as the clinic provides the given service. Before any private clinic becomes eligible for such funding, it will have to meet certain criteria which can be determined by a special body set up by the government (The House Committee on Energy and Commerce 1).

Compliance will be pegged on ability to offer specialized services in a wide range of areas. This will prevent some individuals benefitting at the expense of others. Because private insurance companies have remained very restrictive in offering their insurance cover to people, and have clearly discriminated against those not able to afford the very high services, it will be beneficial if they are to be compelled to follow the requirements of the government, where although they will have to continue offering their insurance for the interim, they will be required to revert to the government one after some time, when the time given for all the people to have had a new insurance plan expires (Isaacs 137). It will be the role of the same body to distribute the government funds to the hospitals, ands to ensure there is compliance. The money to be paid will be that collected from the employees through contributions to a health care insurance scheme, together with that which the employer and the government contribute. Those companies and private individuals who insist on having their own insurance can then be vetted and their bank accounts accessed to ensure they are complying with the requirements. This way, they will never have to cheat that they are insured when they actually are not (Shi 440).

Every person who is in need of health care services will only be required to find the place that best offers the service one requires and no payment whatsoever is to be made. Like the Taiwanese system of health care, this country ought to have this plan made in such a way that there will be no need for a doctor or physician to refer a patient to another facility because every doc tor is to be empowered and given the capacity to be an expert in ones area of service (The House Committee on Energy and Commerce 1). Referrals have been contributing to delays and have been opening up avenues for fraud and misappropriation as it has been difficult to ascertain who gets what level of compensation for the health care service offered.  As far as the administrative costs are concerned, it will be the work of the government, being the sole provider of health care services, to use part of the money for administrative purposes. The body formed to oversee the working of such funds will require that high levels of compliance be adhered to. As noted earlier, quality as opposed to quantity of health will be the priority (The House Committee on Energy and Commerce 1). As such, it will be required  that a thorough vetting process of all health care providers in the country is done so that the country moves away from caring about how to get health care services to where to get them because they will be lost for choice.

Fraud has been a very serious issue and most of the past oppositions to a comprehensive health care plan have been due to fears that it will not she administered well enough because of cheating and fraud among some of the people involved (Matcha 56). In order to curb this, the proposed plan ought to not only intensify supervising but will have to embrace the spirit of collective responsibility where the private sector and the public one will collaborate to ensure that there is a general success of the plan. The underlying factor, in essence, is to make working together a priority. It is an all-inclusive program that seeks to make all people benefit.  The other aspect that will make this dream closer to realization than ever before is that there has to be a  way of ensuring that even those people who are given insurance by their employers are able to pay lesser premiums to the employer. After all it is a shared responsibility now and no longer will those who have insurance be required to pay for those without as is the case now.

The Implications of the Solution
As expected, the main stumbling block to this solution is the opposition to it that stems from the fact that it has very dire and far-reaching economic consequences. Although this plan is out to help the majority of the people, it will also impact negatively on the countrys different economic sectors.

The Effects on the Countrys Economy
The economic implications of the plan are definitely many especially since it will be an inaugural one. The economy will face many challenges, including the possibility of stagnation. There are certain specific effects that the plan might cause to the national economy. The first area to be affected is the employment market. Many jobs in the health care sector are going to be threatened over the next decade or so as the plan takes effect (Matcha 57). Job losses are particularly expected in the private sector, where most insurance services have been traditionally offered for a very long time. Although the immediate or short term effects to jobs might be minimal, the long term consequences might entail having to have the people who once operated in the insurance industry becoming unemployed. This will result in a case where the government will have the added burden of dealing with more people without employment. This will force it to increase its expenditure, thereby creating deficits in thebudget.

That aside, the plan in itself will require a lot of funds, taking a very significant share of the national income (Mark 1). This will greatly impact the GDP of the country in that such huge spending on a single sector of the economy cannot be sustained without additional government revenues. To get the plan working, the government will have to tax people allot more and this will reduce their disposable income and lower their per capita income. Lower per-capita incomes mean a shrinking economy. There is a risk of the economy stagnating for some time because of the sudden freeze in a number of economic activities during the implementation of this plan. Certain hospitals might have to face patient shortages and so lack income, thereby causing a reduction in the national revenue (The House Committee on Energy and Commerce 1). The fact that the recommended plan is a universal one  all people will have to be included  makes the burden on the economy even greater. A specific case is that of providing health care services to people who might not even be benefitting the country in any way such as immigrants, both legal and illegal, and many other people on temporary missions in the country.

With the global economic crisis still not fully under control, such a plan will be disastrous to the economy which has just been stimulated with so much money. Huge expenditures of the level needed to finance this plan will further cause economic instability when certain economic sectors are still struggling to get back on their feet. There are positive effects as well. The plan is bound to act as a stimulus to the economy because it is going to create a vast number of jobs. Since many Americans are employed in the health care sector or its subsidiaries, increased spending and investment in the sector is likely to spur economic growth (Matcha 58).

Impacts on the Insurance Sector
Although other sectors of the country will be affected negatively by this solution, the health care insurance one will suffer the most. This is because literally all their services to the people will become obsolete once the plan takes effect. This plan does not have any commitment to help insurance companies. In essence, they will all be pushed out of business which they have done for years. This is because the government will be the sole provider of such insurance cover. Although provisions have been made for clients to choose between the government plan and the one they have been using, it is highly unlikely that anyone will be prepared to go for the private insurance policies which have been in place for so long and which are reputed to be very costly (U.S. Congressional Budget Office 1).

Insurance companies are in for a lot of loss-making once such a model is implemented because they will lose their clients to the government. What the model offers is a stab in the back of the insurance sector (The House Committee on Energy and Commerce 1). However, because it is an all-inclusive plan, the insurers, particularly those in the public sector or the non-profit segment, will greatly benefit from increased demand because they will not be required to totally stop providing their services. The competition in the industry is likely to intensify, culminating in a more competitive and so effective industry.

The Effects of the Plan on Pharmaceutical Companies
Medication has been the underlying factor for all health care services. Every person seeks to have medical services at one time or another and they all entail the use of medication. The proposed model will have varying impacts on pharmaceutical companies. The first one is that because of the increased access to health care services by people, the demand for drugs will definitely rise and so these firms will have increased sales of their stocks. Sales for drugs, especially those used in the treatment of chronic conditions and other ailments that require a lot of money to treat, will increase.

In the past, the affordability of such services has been limited to a few people but this will come to an end once this model is put in place. The more the people who have access to health care services the more the demand for drugs across an entire spectrum of health conditions. Since no-one will be expected to pay at the point of service, according to this plan, it will make it a policy for pharmaceutical companies to better evaluate the market share they are likely to serve (U.S. Congressional Budget Office 1). Their customers will essentially be limited to health care service providers, making the need for marketing to be eliminated.

Impact on Health Care Providers
The consequences of the reforms in health care to health care service providers will be far-reaching and instantaneous. As earlier mentioned, the modern America suffers an acute shortage of good health care services, and the low-quality services available have been an added hindrance to people seeking medical care who are already limited by the high cost. With the new model, however, these problems are expected to be resolved. There will be not only high quality services but also their affordability will be greatly enhanced. Therefore, in accordance with the laws of demand and supply, the demand for these services will shoot through the roof. This will lead to a case where the already insufficient staff in health care institutions will be greatly stretched.

There will be a higher demand for health care service providers and this is likely to cause a compromise in the quality of the services being offered (Cryan 1). This country has had a perennial problem of shortage of health care providers, and these reforms in the health care sector are bound to worsen it as affordability for health care services improves and more people seek the services. To overcome this problem, there will have be a drive to train and subsequently hire more health care prodders, especially physicians, doctors and nurses. Health care institutions like hospitals are also likely to emerge and they, too, will need more personnel. The model will have to make health care service provision to be commensurate with facilities and personnel availability.

Impacts on the Federal Budget
As earlier indicated, the main concern regarding the solution is its financing part. This is because it will greatly increase the expenditure of the federal government, with possible outcomes being that there can be a deficit in the budget. Since it is expected that the reforms could take up to a trillion dollars in the next ten years, budgetary deficits are likely to result unless alternative financiers are sought (Cryan 1). An increase in public debt is also a possible outcome since in an attempt to meet the huge costs the government might just decide to borrow locally. Given that a large proportion of the gross domestic product of the country will go on health care spending, the remaining sectors of the economy might have to be reduced so that the budget deficit is made more manageable. There is a risk that government spending in the areas deemed less important might greatly reduced. The greatest share of the money will have to go into funding what has previously been funded by individuals. Although there will be a cost-sharing approach, this will do very little to control the budget surge.

Financing the Plan
The plan will be financed using a wide array of means, although taxes are to be the main sources of the funds required. Every working citizen will be required to contribute a monthly fee in form of a tax. The employer and the government will contribute the rest. The sum collected will fund the plan. People will be taxed in accordance with their income, the rich paying more to cater for those who are without employment or the low income group.

Impact on Manufacturers of Medical Equipment
Just like pharmacists, manufacturers of medical equipment are bound to benefit from the plan because the increased affordability of health care services will increase the demand for their products. In addition, the increased funding in the entire health care industry will mean that it will attract more professionals, who in turn will require using medical equipment more than ever before (Cryan 1).

The Role of Computer Technology
Over time, the administration of health care programs has been difficult and expensive. This plan will use computer technology to administer most the work. Monitoring the accounts of employees and verifying the details of individuals who are eligible for specific types of insurance cover are some areas that will use computer technology. The technology will also be used to monitor the allocation of the funds to different health care facilities, and for direct medical procedures in the effort to improve quality in the sector (Cryan 1). Electronic communication will make links between the federal government and state and local offices of the program to be easier, thereby greatly enhancing communication.

Health Care Cost Reductions
The plan will cut costs of health care services in the many areas, but notable ones are in the area of specialized services like surgical procedures. Medical equipment and services are also likely to cost less owing to the streamlining that will be done there. Since administrative costs have been a great cause of the high costs, use of computer technology will go a long way in eliminating these costs (Cryan 1).

The Economic Impacts
Because many people will be in a position to save a lot of money through the plan, their disposable incomes will increase as will their per-capita income. Households will therefore be better placed to meet their life goals as they will be a lot healthier. Businesses will thrive because the huge investments into the health care sector will be translated into an economic boom which will be characterized by, among other factors, an emergence of small businesses and an expansion of the existing ones. The general business environment will be boosted (Cryan 1).

Conclusion
Having a health care plan that is all-inclusive is the only solution to the problem of high health care costs and the lack of quality service. This plan ought to remove the restrictions by private insurance companies so that every person can have access to health care. It also seeks to improve quality in the sector by hiring more staff and buying new equipment for the hospitals. Private practitioners with clinics will have to meet strict requirements to qualify, a factor that will ensure high quality service. Although costs are high initially, the plan will drastically cut health care spending by the government, and make health care affordable to all people living in the country.