The Big Healthcare Issues Costs to providers and prices they charge are going up Cost of health insurance going up Costs to individuals, businesses & government going up Impacts international competitiveness and government debt Huge problem for the future 30 – 40 Million Americans not on any insurance A moral issue? Many on insurance have difficulties in coverage or transferability if they change jobs

Healthcare Economic Cycle Patients Employers CARE Providers Doctors & Nurses Hospitals Clinics Testing & makers Pharmacies & drug companies Private Insurance Pool 15% $2.5 Trillion & rising fast 85% US Government - Medicare (+65) - Medicaid (poor) $900 Billion

Insurance Risk Pools The Many pay a little for the expensive Few Incentive to limit the expensive ones in the pool As a business, income exceeds outflow, or else… As costs paid to providers rise, so must premiums Must keep $ promised for benefits in reserve Can invest some of reserve to make $ Regulated locally by each of 50 states Some states regulate better than others. Level of competition varies Rules and benefits vary

Cost Issues for Providers As a business, income exceeds outflow, or else… Must pay for salaries, rent, supplies, technology, investors… Malpractice insurance very expensive Jury awards emotional and sometimes very high By law, hospitals must treat regardless of ability to pay. Where do they make up this cost? Research, testing and licensing of medicines takes many years and costs many millions. Success uncertain Patient privacy and transferability of records Increasing technology very expensive develop and use

Other Issues Affecting Prices Fee for service incentive to do more services Defensive medicine: More testing and procedures Supply of doctors, nurses, testing and medicine limited: Price goes up Patients covered by insurance rarely see or pay cost of specific care, so demand goes up Growing number of older patients Overall costs per person rising four times inflation rate Voters want unlimited, inexpensive, high quality health care, with their choice of doctor. So what is a politician to do?

Medicare and Medicaid Costs Increasing number of customers, and increasing cost per customer

Frequently Mentioned Ideas Government run: Health care system (“socialized medicine” ?) Single payer insurance system “public option” as an alternative to private insurance Boards to exclude expensive procedures and medicines unless they are REALLY worth the extra money More preventive care before people get expensive illness Require all to have insurance, provide help to poor Expand required coverage and portability of insurance Standardize technology of transferring patient info Limit jury awards in malpractice cases Change fee for service incentives

Healthcare Providers Healthcare System? Doctors & Nurses Hospitals Clinics Testing And makers of testing equipment Pharmacies And companies that make the medicine