Healtcare Costs and Their Driving Factors in the US | Free Essay Example

Healtcare Costs and Their Driving Factors in the US

Words: 320
Topic: Health & Medicine

The United States of America has the most expensive health system in the world. Specialists identify seven main reasons for the increase in expenditure on health care. The first reason is the payment of insurance, which implies specific medical services, which often do not correspond to the necessary medical care for patients when they enter the hospital (Appleby, 2012).

Secondly, in the US, a large percentage of the population is obese. Treatment of this disease is not an entry into medical insurance and requires additional costs. Thirdly, physicians require the use of new technologies and medicines, the effectiveness of which has not yet been proved, but their cost is several times higher than the technologies tested by time.

Fourthly, it is the excessive use of health care due to tax coverage of costs by employers. Fifthly, it is the lack of information on the effectiveness of treatment methods. Sixthly, prices on the sphere of medicine are dictated by monopolists and are groundlessly overestimated. Seventhly, it is the overestimation of the cost of maintenance because of the appointment of unnecessary medical measures (Appleby, 2012).

Based on medical practice, the above mentioned seven reasons can be attributed by incomplete public funding of the health system. It receives financing from public and private funds. In the US, the total budget for health care is composed of the following funds: state program “Medicaid” makes up 10%; state program “Medicare” is 17%; other government programs are 15%; means of private medical insurance make 33%; funds from other private sources comprise 4%; personal funds of citizens are 21% (Groves, Kayyali, Knott, & Kuiken, 2016).

A significant part of the population remains uninsured. The current medical system is characterized by the unresolved intercommunication between the public and private areas of the economy. Even though the state allocates huge amounts to the industry, it does not have effective levers for controlling prices and costs of services and drugs.


Appleby, J. (2012). Seven factors driving up your health care costs. Kaiser Health News. Web.

Groves, P., Kayyali, B., Knott, D., & Kuiken, S. V. (2016). The’big data’revolution in healthcare: Accelerating value and innovation. Center for US Health System Reform. Web.