I suppose we should start at the beginning. I want to talk a little bit about what I hope this blog ultimately becomes; a forum for ideas…not just mine, but yours too! I hope that what I post here will entice people to not only read more but to engage in the conversation. I hope that our conversation will result in increased insight for us all and, hopefully, a better healthcare system that everyone in our nation can enjoy!
If you have an idea for a Healthcarefully! Discussion, please feel free to recommend it to me.
Because so much of our healthcare system revolves around money, I thought that would be a good place for us to begin…with a brief discussion about the economics of our system.
The most basic Economic concept is the exchange of value, like money, for something else that we value more such as a product or service. The foundational aspects of such a trade hold that both parties receive something that they value (both benefit) and both also hold the belief that participating in the trade will result in a higher degree of satisfaction than if they had not done so. However, due to the complexity of providing care in today’s world these types of principles are not as readily apparent as they are in a less complicated transaction. For example, when a consumer wishes to purchase a loaf of bread they simply go to their local store and purchase that product. There is, of course, no need for “third party” payers, insurance, co-payment, or forms to fill out like consent or release of patient information…purchasing a relatively inexpensive (and non-life threatening) loaf of bread is unlikely to require such machinations. However, when we factor in the element of our health, well-being and the costs associated with providing expensive Healthcare services such as; surgeries, transplants, chemotherapy, ostomy and wound care, the need for insurance coverage and governmental subsidies of costs become an enormous factor in offsetting the out-of-pocket costs for the individual patient.
When we examine the costs associated with today’s healthcare from a basic economic perspective, we can only then begin to understand that these types of procedures must be spread over a wider contribution base rather than expecting only the individual to pay for these pricey procedures. This is one reason that insurance has become a necessity in today’s Economic climate. Another reason is mitigation of personal financial risk. “If I am sick, I do not know for certain the outcome of treatments or medications; I hope for the best but realize that adverse side effects can happen. And from a financial perspective, I do not know what my medical bills will be” (Pauly, 2007). For example, Oncology treatments and procedures for Cancer can run into the hundreds of thousands of dollars for a single patient. There are few people who could afford such expensive remedies so the costs are spread not only over many thousands of people paying premiums for insurance but also, in many cases, over several generations.
In conclusion, although we may not see the basic and fundamental mechanics of Economics occurring in today’s healthcare does not mean that those transactions are not happening. It means that the flow of funds is more complex, progressing through more avenues like a vast web of a network of hospitals, suppliers, clinicians and care givers, third party payers and governmental agencies as well as patients. “Nations across the globe enjoy (or suffer) highly varied levels of success in maintaining quality health care systems while controlling cost” (Guse, 2013). Our system of healthcare has grown well beyond the cottage industry that it once was. Today, we can treat (and sometimes cure) conditions which were once fatal. Technological advances are empowering clinicians and patients alike to make more informed choices. Advanced surgical techniques are yielding unprecedented results that the world has never seen before. The price of all of this progress is steep. For this reason, basic economics is at work…just in a more complex world.
References
Guse, A. J. (2013). The economics of public health care reform in advanced and emerging economies. Choice, 50(5), 929. Retrieved from http://search.proquest.com/docview/1296954687?accountid=41759
Pauly, M. V. (2007). Risks and benefits in health care: The view from economics. Health Affairs, 26(3), 653-62. Retrieved from http://search.proquest.com/docview/204504564?accountid=41759
Welcome to Healthcarefully! 