During 2012, the average health care spending per person in the United States was $8,895, which is among the highest rates of healthcare spending in the world. In general, the medical care available today is expensive because of all the training, research, administration, and technology involved in making the care possible. This can be further broken down into specific aspects of care and actions of patients and health care professionals that contribute to high overall medical costs in the United States. Here are a few:
Patients accept high costs
Whether payment is made directly to a provider, to a traditional insurance company, or to a healthcare alternative that shares medical costs, the typical household is required to buy a qualifying form of health coverage under the Affordable Care Act. When people have health coverage, they typically pay less attention to the bill being sent to their insurance company after treatment. Unlike almost every other industry, people generally do not ask the price before they undergo treatment. This lack of overall market discipline leads to high costs and low competition.
Medical malpractice insurance is costly
Physicians are held accountable for their medical decisions, and the United States has developed a litigious climate with regard to health care. If something goes wrong that could be attributed to a physician's negligent behavior, the patient can bring a lawsuit. This leads to defensive medicine, where doctors order extra procedures to ensure they are being thorough and not letting something slip through undiagnosed.
Patients need to understand, though, that they have the right to decline medical procedures. When using a healthcare alternative where the cost of care directly relates to the cost of share amounts, patients are more likely to decline unnecessary procedures.
Administrative costs are high
The health care system in the United States operates with quite a bit of overhead, including advertising, collections for payments, and customer service to field questions about bills and services. Plus, many healthcare institutions, including hospitals and insurance companies, have high administrative and compliance costs.
At Liberty HealthShare we are a not-for-profit company with a low, fixed, 12% administration cost. We also have fewer compliance costs because we are not an insurance company and do not supply insurance but rather medical cost sharing.
Developing prescription drugs is expensive
Prescription drug research and development has taken off in recent years as companies have worked hard to develop more effective drugs. This research costs a lot, as does the manufacturing and marketing of the resulting drug. One way that individual patients can lower their health care costs is to choose generic prescription drugs instead of brand names when possible.
People engage in unhealthy behaviors
One of the largest underlying factors contributing to high medical costs is the fact that many people live unhealthy lifestyles. Tobacco use, a sedentary lifestyle, alcohol abuse, and a diet high in sugar and fat are all risk factors that can lead to the need for medical procedures. If people take ownership of their own health and choose to live a healthy lifestyle, they typically end up with fewer medical problems and lower medical costs. That is why many Christian healthcare options include a healthy lifestyle requirement, which can help keep share costs low for everyone.
These are some of the many reasons healthcare costs have gotten so high. At Liberty HealthShare we help drive healthcare costs lower through behavior while still facilitating the sharing of medical costs for our members.
If you or someone you know is interested in medical cost sharing, feel free to call us at (855) 585-4237. You can also take a look at our three sharing programs or request our free decision guide for more information.