The Rising Cost of Healthcare in America

The rising cost of Healthcare In America

The cost of healthcare has risen dramatically, over the last half of the century in the United States. Essentially, the U.S. spends trillions of dollars in healthcare annually. The Centers of Medicare and Medicaid Services noted that, that in 2014, U.S. health care spending increased 5.3 percent following growth of 2.9 percent in 2013 to reach $3.0 trillion, or $9,523 per person ("National Health Expenditures 2014 Highlights"). Furthermore, I would suggest that the U.S. spends way more money on healthcare, than a lot of the other industrial nations. Ultimately, politicians in America have been debating for years on how to fix the broken system.

Initially, in the 1960’s healthcare was essentially less expensive. In 1960, businesses, households, and other private sponsors financed 77 percent of health care expenditures, while government sponsored the remaining 23 percent (Catlin and Cowan). Health care expenditures were less expensive per capita in the 1960’s. The typical American household paid less money annually than they do today. The Centers For Disease Control and Preventions reported that in 1960, the per capita health expenditures were $125, compared to $9,523 in 2014 (CDC). Ultimately, one paid $9,398 less in healthcare in the 1960’s than they do now. One could argue that these were the good old days. Nevertheless, some of the cost may be potentially attributed to the innovation of technology in the U.S. healthcare industry. For example, we use a lot of MRI and CT scans to help identify and diagnose existing health problems, which ultimately cost a lot of money. The equipment used to perform MRI’s and CT scans are really expensive, however play a central role in trying to identify a health related problem or issue. However, the government has really expanded its role in the healthcare industry since the 1960’s. One could potentially argue that less government may equate too less expensive healthcare. The federal government has passed numerous programs since the 1960’s in attempt to provide affordable healthcare to its citizens. Some of the government healthcare programs include: Medicare, Medicaid, and the Affordable Care Act. I would simply ask, “Has these government programs worked?” In the next few paragraphs, I will be essentially providing a brief summary of each government program and how effective it was throughout history.

First, I would like to discuss Medicare. In July 1965, Lyndon B. signed into law the bill that led to Medicare and Medicaid. Medicare is a federal health insurance program designated for people who are 65 and older. In 1965, the budget for Medicare was around $10 billion and 19 million individuals signed up for Medicare during its first year (Anderson). Before the “Great Depression” in the 1930’s many of the elderly were dependent on their children to help take care of them in the later years of their lives. However, after the “Great Depression” many of the adult children were unable to take of their elderly parents, therefore the government felt compelled to intervene. Furthermore, it only made sense to make the elderly pay only 20% of the cost versus 100% since many of them were not working full-time jobs anymore. Subsequently, in the 1970’s the federal government added people with disabilities to the Medicare program. In the fiscal year of 2015, the budget for Medicare was $546 billion, which ultimately provided coverage for 55 million Americans (“Policy Basics: Where Do Our Federal Tax Dollars Go?”). There is an absolutely significant