In January 2021, the Department of Health and Human Services’ Office for Civil Rights announced that Excellus Health Plan, a health insurance provider, had agreed to pay $5.1 million. The money was paid as a penalty for a HIPAA violation case for a data breach that affected 9.3 million individuals (Cohen, 2021). The company’s computer systems had been accessed by hackers for two years between 2013 and 2015. The malware had been installed into the company’s computers and data for approximately 9.5 million customers accessed (Cohen, 2021). This data included names, contact information, dates of birth, social security numbers, health plan ID numbers, claims data, financial accounts, and clinical treatment information. Investigations revealed that the company was not in compliance with several HIPAA regulations and was, therefore, fined.
Mitigation or Prevention of Breach
Excellus Health Plan could have prevented the breach of the HIPAA privacy and security regulations by conducting regular risk analyses to identify weaknesses in their systems. These investigations into the electronically protected health information would have helped them invent means of strengthening their systems to combat malware. Additionally, the company could have ensured that its data is appropriately protected by ensuring that only authorized persons access it since the breach resulted from unauthorized access. The company could have established policies for regular reviews of the information system. These policies would have been a source of immense assessment of the electronic data and devices to ensure maintenance is within company needs and regulations. The company could seek the services of electronic system developers to ensure their electronic devices were installed with the latest malware detection and elimination tools.
Office for Civil Rights Enforcement Activities and Results
Similarities
In the majority of the cases, there is a third party entity that gains access to confidential information belonging to clients, therefore, violating their privacy. The access to data in most situations results from an insufficiency on the part of the party entrusted with the information, whether an insurer or a hospital (HIPAA Journal, 2021). The cases of HIPAA violations result in huge financial losses for the organizations entrusted with safeguarding such information.
Differences
A major difference arises in the nature of the institutions entrusted in safeguarding health information which includes hospitals and insurance agencies. There is a wide range of information that is divulged during the violation of the HIPAA rules, ranging from personal information to medical and financial information (HIPAA Journal, 2020). The nature of the HIPAA violations also varies, ranging from hacks of electronic devices using malware, diverging of information by staff, and data leak through unauthorized access.
Security Rule Violations and Privacy Rule Violations
Most of the security rule violations also involve privacy rules violations as there is the access of restricted information and divulgence of the same. Most cases present with the use of malicious malware to access protected data without the consent of the insurers and inappropriate use of that information (HIPAA Journal, 2019). The information is reportedly sold to the highest bidders who use this information for their own marketing needs, interfering with the lies of the patients.
Types of Cases and their Resolution
The cases were mostly due to negligence on the part of the organization entrusted with protecting the information. The most popular method of punishing the culprits involved fining them lsums of money for compensation (HIPAA Journal, 2019). This is appropriate, alongside proper modifications to their systems to ensure compliance with HIPAA rules. Additional monitoring is also crucial and is part of the resolution of most cases as it ensures such errors are avoided in the future.
Cooperatives are organizations that are owned and run by those members that enjoy their services. In the United States, nonprofit health insurance cooperatives have been recommended as the third option to the tradition private health insurance and the newly suggested public health insurance. In United States, different cooperatives offer their members diverse services that range from credit loans to electricity. Thus, the issue of cooperatives and specifically the concept of health insurance cooperatives is not a new phenomenon to Americans. The introduction of health insurance cooperatives in US will enable an approximately 47 million uninsured Americans who belong to the low social economic status receive affordable medical care.
Health insurance cooperatives have lately received a considerable political support from various political personnel’s such as the senator Kent Conrad as they are known to reduce the insurance premiums paid by their members considerably. He considers them as the best option to provide insurance covers to Americans since they are neither governmental project nor one for profit making, but instead a project tailed at helping the public. Despite the great support the project has received from various stakeholders, there are few people that view it as a wrong focus that cannot match the superior government program. They are of the opinion that the government should establish health insurance cooperatives as an alternative to the government public health insurances, but not as their substitutes.
They argue that health insurance cooperatives cannot expand robustly as the public health insurance projects can do. This controversy has raised a considerable debate worldwide of whether the United States should opt for a public health insurance program or health insurance cooperatives which are regarded as more economical, efficient and effective in addressing the health issues of majority of Americans who cannot afford to access the high insurance costs associated with private insurance coverage (Debate: Health insurance cooperatives, 2010).
History of Insurance Cooperatives in United States
Health Insurance Cooperatives are health insurances schemes that are designed to offer insurance services to their members at a reduced cost than the private insurance companies. Health insurance cooperatives are jointly owned by all those people that insurer with them, unlike private insurance companies that are owned and controlled by private investors with their main objective of making profits. The concept of health insurance cooperatives is not a new phenomenon in United States since it has existed in United States as early as 1983 in many some of its States such as California and Minnesota.
Such cooperatives are generally known to be formed and managed by employers with a common agenda of enhancing the health care of their employees. For instance, annually Santa Ana Strawberry a farm that is owned by Mack Ramsay Pores offers its 35 employees insurance coverage from a health insurance cooperative based in Irvine. The insurance cooperative covers roughly 15,000 Californians agriculture laborers. Due to its cost effective mechanism, this nonprofit health care system is currently being reviewed as an appropriate model by the proposed insurance cooperative. The Irvine health insurance cooperative is referred as the United Agriculture Benefit Trust and operates like a normal private insurance company.
The reason why it is more profitable to its members than other insurance firms is because it uses its power of collective bargaining to negotiate better rates with doctors and hospitals. Ramsay commends that the services that are received from health insurance cooperatives as being better and cheaper than those provided by their counterpart private insurance companies. The services that the health insurance cooperatives offer are superior to the one given by private insurance companies because cooperatives do not operate for profits and any profit they realize in their operation together with their savings is usually reinvested back.
Nevertheless, there are some critics who argue that health insurance cooperatives are not in the long term profitable to their members since they are noted to be more likely to face insolvency due to being poorly regulated, unlike their compliment private insurance companies that are better managed. The allegation about health insurance cooperatives being faced with insolvency is not true according to California Insurance Commissioner Poizner who advocates that all insurance trust face similar challenges and all could ruin if hit hard financially (Stukel, & Deller, 2009)).
Health insurance cooperatives results when owners of small enterprises join together and negotiate for lower insurance coverage using their multitude as their negotiating power. It is through this process that the California agriculture Trust was initiated in 1983. Cooperatives are successful in ensuring low rates, unlike tradition insurances. The health insurance cooperatives are able to offer their members better rates because their premiums are exempted from being taxed.
Nevertheless, they are thus exempted from guaranty funds that are meant to pay claims in case an insurer becomes insolvent. This is a major failure that is associated with health insurance cooperatives in America since all those cooperatives that have become insolvent were unable to pay their members and thus bringing a dilemma of whether they are really profitable to their members at all (Longley,2009).
Pros and Cons of health insurance cooperatives
Cooperative health insurance programs have a number of merits. One advantage that is associated with them is their ability to strike a good deal with relevant stakeholders due to their collective bargaining power. By aggregating together cooperative members are in a better position to receive insurance coverage at lower costs. The lower costs that are associated with collective bargaining may encourage even those firms that were not previously offering health coverage to their employees being encouraged to do so. In addition, to the lower costs associated with health insurance cooperatives as a result of collective bargaining, the premiums that are paid by cooperative members are also lower because they are not taxed like other premiums paid by the members of for-profit insurance companies.
These exemptions enable cooperatives to offer their employees insurance coverage at more affordable rates since they are not subjected to the same regulations as other private insurance firms. If the United States adapts the proposed health insurance cooperatives, the high number of the uninsured Americans will greatly reduce since many of them will now be in a position to afford the new insurance coverage as it will be more affordable.
Health insurance cooperatives are programs that are designed to cater for the health needs of their stakeholders, but not meant for profit making. Though the venture are required to operate profitably, the profit realized is reinvested back to the system to enhance the services delivered, rather than being channeled away as a bonus to the shareholders as it is common by private insurance companies. Thus, health insurance cooperatives are then more profitable as they are more likely to offer their members more benefits due to the profits and savings they reinvest back to the system instead of distributing them to the shareholders.
Analyst believe that if well supported and managed, health insurance cooperatives can support up to 12 million customers which can make them among the leading nations insurers. Since the project is community based, it uses community networks, infrastructure and resources to offer its services better and at a more affordable price to its consumers who are also its members, unlike private insurance companies that first invest heavily on these facilities and then raise their coverage costs considerably to get back the money they invest and make a profit. Health insurance cooperatives seem to be the best alternative health insurance system for the Americans.
It is believe that given appropriate regulatory system coupled with necessary funding, health insurance cooperatives are sustainable and will be very effective in providing American with health services that are exemplified internationally. To enhance their efficiency, it is recommended that establishment of a national body that will oversee negotiation of the reimbursement rates will be very important. The health insurance cooperatives to be established should be tailed to be patient-centered, performance oriented for providers and one that helps to control and keep costs low so that many Americans can enjoy its services (Wicks, 2002).
Private insurance companies have dominated very much the American market. Their dominances have resulted to them offering insurance coverage at very high costs a move that has rendered many Americans without insurance covers. The current government is now very concerned about how it can increase the number of Americans that are insured and if possible ensure affordable coverage for all Americans. Thus, the introduction of health insurance cooperative will be a very strategic move for it.
This is because health insurance cooperatives will create a stiff competition to the existing firms because cooperatives will be able to offer their coverage at a lower cost to their members due to the exemptions they enjoy. This competition will intern make other firms that offer insurance covers to lower down their coverage costs in order not to be phased out of market. Fair coverage will help more Americans take insurance covers and help them reduce the risks they expose themselves to without the covers (Hennigan, & Linthicum, 2009).
Despite the many advantages that are associated with health insurance cooperatives, they are also faced with a number of limitations. For instance, health insurance cooperatives are known to suffer from the challenge of scaring. To reduce the large number of uninsured people in United States, the system will require a considerable time and billions of dollars being invested to oversee its success. The biggest challenge is on how to build up a system that will overwhelm the current insurance system owing in mind that the current health insurance cooperatives in US accounts for only 1 percent of the existing health insurance market. Analysts predicts that with the current environment, these cooperatives will not be able to win any market in many areas due to the stiff competitions they are likely to experience from the established private insurance firms.
As mentioned earlier, health insurance cooperatives have a problem in scaring and thus, addressing the need of 47 million of the American who are not insured will be a major challenge to them. Therefore they have to be strategically positioned to be successful in realizing their main objective of insuring the millions of Americans that are not insured. In addition, if they fail they will not even succeed to offer better packages to Americans who are already insured with other companies, but cannot afford certain packages from their current insurance companies. These analysts are advocating for the program to receive unfair market edge through specific government interventions. They recommend that the members of health insurance programs should not be subjected to pay premium taxes that are associated with for- profit insurers. Thus, the system is to be greatly supported by taxpayers’ money which will give it the required advantage to compete healthy and greatly boost help it in spreading (Richardson, 2011).
Health insurance cooperatives are known to suffer from the problem of portability. Its problem in portability may act as a very big slow down in the expansion of the new insurance scheme, since many Americans will hesitate to embrace it as they will not be aware of what will happen when they relocate to new States. The problem will occur because a member of a certain health insurance cooperative will be forced to buy coverage of another cooperative when he relocates into another state since it will be very difficult to guarantee equivalent insurance coverage. This problem occurs since cooperatives are not well spread and one may not be in a position to take one plan from one Estate to the other. Due to their portability failure, health insurance cooperatives will be considered as inferior to their counterpart private insurance companies. Thus, lack of flexibility in portability is likely to greatly compromise their spread which might render them unprofitable in the long run (Richard, 2010).
The histories of many health insurance cooperatives have revealed that most of them have failed due to their inability to compete effectively with other insurance companies. Moreover, they are also known to have failed as a result of building of tension between the doctors and consumer-oriented governing boards that are known to compromise their compensation of physicians very much. This compromise results to reduced performance and quality among the physicians. This makes doctors to be discontented and less motivated which greatly compromises their services. Thus, with this major shortcoming health insurance cooperatives may not seems to be the best insurance alternative to have since they are more likely not be effective and hence not profitable eventually to invest in (Nakhasi,. & Thigpen, 2009).
My views concerning Health insurance cooperatives
Health insurance cooperatives are well known to cut down the costs involved in health insurance coverage. The reduced costs are necessitated by their collective ability to bargain for low coverage costs. In addition, their exemption from paying taxes on their premiums makes them be able to offer their customers covers at a lower cost. Despite the critics that they are not portable and not well established, the American government should go ahead and take health insurance cooperatives as their alternative option to private insurance. This is because health insurance cooperatives will greatly reduce the number of Americans who are not insured considerably since their premiums are lower and thus will be affordable by many Americans.
The existence of an alternative insurance system in America and especially health insurance cooperatives will be a very strategic step for the government to introduce an insurance competitor to help and regulate the pricing of insurance coverage that is currently highly infatuated. The new program will initially encounter some challenges as highlighted by its limits mentioned above, but with proper funding and support from the government it will eventually succeed and be the solution the Americans are looking for (Melbourne, Australia Discussion Paper No 3, 1997).
Expected Outcome
The establishment of health insurance cooperative in America will encompass in acting of a policy that will exempt members of health insurance cooperative from paying taxes on their premiums. In addition, for successful operations of the health insurance cooperatives, they have to file with appropriate departments of insurance, although they will be required to offer lower capital requirements than the other insurance companies. According to the US president Barrack Obama, the enactment of health insurance cooperative as an alternative insurance system in America will result to an increase in the cost of private insurance such that only very few people will afford it. Nevertheless, the new insurance will greatly help many Americans that are not insured get an opportunity to get coverage. The new insurance will be offered at a cheaper rate and thus more affordable than the current one. Many people that have insured with the private companies will be forced to take covers with health insurances cooperatives since they will be more affordable than the former (Torrey,, 2010).
Reference List
Debate: Health insurance cooperatives (2010) Web.
Hennigan, W. & Linthicum, K. (2009). United Agricultural Benefit Trust spotlighted as model for healthcare cooperatives. Web.
Longley, R. (2009). What are Nonprofit Health Insurance Cooperatives? Web.
Melbourne, Australia Discussion Paper No 3 (1997.) Opportunities for Co-operatives in Health Care. Web.
The American health care system has been regarded as a failure and one that does not meet the direct needs of ordinary American citizens. The ever increasing cost of health care is believed to have led to the existence of scores of uninsured Americans (Himmelstein and Woolhandler 1).
Unlike most other nations, it is alleged that the United States spends a huge chunk of its Gross Domestic Product (GDP) on health care services. According to analysts, what the United States spends on health care should be sufficient to cater for the needs of all Americans (Boychuk 15). This, however, is not the case given that many Americans are still unable to benefit from the apparent heavy expenditure on the provision of health care services by the US government.
As noted by Laham (13), many patients continue to suffer despite more than 20% of America’s GDP being used to meet health care costs. In the year 2012, for example, several individuals and families became bankrupt as a result of spending quite heavily on health care services. Ostensibly, insured individuals have not been spared considering that their health insurance covers are inadequate to meet all their medical expenses (Laham 14).
For this and many other reasons, it is obvious that the United States needs a national health care insurance program that can effectively address health concerns of its citizens. The heavy allocation of the national budget to the provision of health care services certainly needs to be justifiable.
Important Requirements for a National Health Insurance Program
It is imperative for the US government to identify various stakeholders who can be consulted in the process of designing an effective national health insurance program. Stakeholders may be individuals, private and public organizations or community heads. Apparently, leaving out key players in the process has been seen by most medical practitioners as a hindrance to effective delivery of health care services to US citizens.
Rather than denying them an opportunity to be heard, they should involved at every stage in order to alleviate loop holes that may be hidden within policies put in place to govern the provision of health care services. Presumably, the involvement of key stakeholders in policy making will eliminate any form of bias in the health care system and ensure that it can meet the needs of all Americans equally.
Unfortunately, institutions such as the American Medical Association (AMA) have been accused of working against the implementation of plans meant to benefit individuals who may be unable to meet the cost of insurance (McCanne 115). Instead of promoting fairness AMA has been on the forefront of those accused of promoting unfairness. By and large, this has made it possible for greedy individuals within the medical sector to gain heavily while millions of Americans are denied the opportunity to access affordable health care services.
The high cost of health care services in the United States can thus be linked to the activities AMA and other like minded organizations. Allegedly, these organizations have contributed to the suffering of many by being biased and only focusing on the affluent in the society while ignoring families and individuals who cannot afford the cost of insurance services.
It is thus critical for the US government to constitute a group that is well balanced and able to represent individuals at all levels in the society. The group must be include people of strict morals who will treat everyone the same and show favoritism to no one. Of paramount importance is to protect the interests of all patients regardless of their status in the society. Whether poor or rich, every individual should be able to access affordable health care services.
Apparently, many people are poor to such an extent that they can not afford the cost of health care services. A number of physicians have argued that the US government should take up the responsibility of funding health care services instead of leaving everything in the hands of private health care providers. In this way, the government will guarantee fairness to all individuals and ensure that everyone benefits.
The State of Insurance in the United States
Scores of people in the United States are subjected to poor health conditions as a result of lack of a well organized insurance program. Without access to affordable insurance cover, the health of individuals will progress from bad to worse. In a worst case scenario, some of the patients eventually succumb to death (Kovner 52). The case is, however, different for those able to access medical insurance. Considering that they can access insurance services easily, they seek highly specialized medical attention that makes it possible for them to recover from their health challenges easily and go on to live for even longer periods.
The increased cost of insurance also has ripple effects that are felt by both individuals and employers. While a certain percentage of the Americans can access insurance, it is alleged that insurance covers may not be sufficient to meet all their health care needs.
Employers are equally affected as they may not be in a position to effectively have their employees covered due to the escalating insurance costs. Due to lack of affordable medical care, sick employees fail to get adequate treatment and this affects their performance at work. Decreased performance on the job later creates a situation where employers do not get value for their investments.
Health Care Expenditure and Quality of Services
As stated earlier, the huge expenditure by the United States on health care in comparison to other countries world wide does not necessarily imply that Americans are all well taken care of medically (Yamagishi 45). As a matter of fact, many citizens face serious challenges when it comes to accessing affordable health cares services. In addition, the heavy spending on health care by the United States does not automatically lead to high quality services for its citizens.
From an international viewpoint, the United States is rated poorly in terms of both life expectancy and infant mortality. While the US government has continued to increase its expenditure on health care, the level of quality has not improved with an equal measure (Mayes 35). Many are persuaded to believe that this is the outcome of an imperfect health care funding system.
To a large extent, health care funding in the United States is channeled through private health care service providers. Apparently, the situation would be completely different if the US government took up the whole responsibility of funding health care services through out the United States. Most health care plans are devised to meet the needs of the affluent in the society and this leaves many poor people at the mercy of unscrupulous business men and women.
Conclusion
Certainly, the United States needs an insurance program that can effectively answer to the needs of all its citizens. More often than not, lack of access to insurance and affordable health care services denies most patients the chance to seek early medical care. This leads to poor health conditions and in some cases, death of patients. Arguably, past efforts by various stakeholders to come up with an all inclusive insurance program are yet to bear any fruit.
The situation is further aggravated by the fact that the society if full of people who are only interested in pursuing their own selfish interests and pay very little attention to the cries of the poor. Greedy business men and women often find their way through a flawed system leaving the poor to suffer the negative consequences of their actions.
Given that an unhealthy population will contribute to national development as expected, it is imperative for all stakeholders to come together and devise a health insurance program that is all inclusive. As explained previously, the US government should consult widely regarding the delivery of health services for all Americans.
Rather than channeling its funding for health care services through private institutions and allowing them to be in charge, concerned individuals have pointed out the need for the US government to be fully involved in the whole process of delivering health care services to Americans in order to ensure that no one is taken advantage of by dishonest business men and women.
Works Cited
Boychuk, Gerard. National Health Insurance in the United States and Canada: Race, Territory, and the Roots of Difference. Washington, DC: Georgetown University Press, 2008. Print.
Himmelstein, David, and Stephanie Woolhandler (1989). “A National Health Program for the United States”. The New England Journal of Medicine. 320.2 (1989): 102-108. Web.
Kovner, Anthony. Jonas and Kovner’s Health Care Delivery in the United States. New York, NY: Springer Publishing Company, 2011. Print.
Laham, Nicholas. Why the United States Lacks a National Health Insurance Program. Westport, CT: Greenwood Press, 1993. Print.
Mayes, Rick. Universal Coverage: The Elusive Quest for National Health Insurance. Ann Arbor, MI: University of Michigan Press, 2004. Print.
McCanne, Don. “A National Health Insurance Program for the United States”. PLoS Medicine. 1.2 (2004): 115-118.
Yamagishi, Takakazu. War and Health Insurance Policy in Japan and the United States: World War II to Postwar Reconstruction. Baltimore, MA: JHU Press, 2011. Print.
The provision of health care services has been a topic generating heated discussion among Americans for many years. This debate has been caused by the availability of two contrasting health insurance policy proposals in the United States that claim to solve the health care crisis in the country.
On one hand, policy makers have been championing for the adoption of universal health insurance, which is a universal health care system that gives emphasis on the community. On the other hand, another group has been campaigning for the adoption of private health insurance, which gives emphasis to more individual risk assessment insurances. This unending debate has put the health care system in the U.S in a crisis.
The ever-increasing cost of health insurance coverage is forcing many people to go without medical insurance. These people include more than 45 million children who are caught in the middle of the raging debate. Politicians are caught between adopting a universal health care insurance that gives an emphasis to the community or the private insurance that gives an emphasis on the individual.
This research paper looks at a comparison of the two policies in terms of efficiency and political influence. The research paper also looks at the issue of private funding for the two policies and gives a comparison on the outcome of the two policies. Finally, the paper gives an analysis of which of the two policies or some combination is most suitable to fix the U.S health care system. (National Council of Churches, 1999)
Efficiency
The pursuit for more efficiency in delivering health care services is unending in a country that uses more money in health care than any other. Attaining efficiency is also important in a country whose growth in spending surpasses its income and is incapable of providing insurance coverage to more than 15% of its total populace.
This is also happening in a country that ranks badly among developed countries in terms of putting up system measures that seek to increase life expectancy and reduce infant mortality. All these issues coupled with the country’s quality problems make it hard for Americans to be complacent about the value they get from their health care contributions. In the real sense, health care can only be termed to be efficient when it improves a patient’s well being while at the same time dissuading the misuse of resources.
For the health care system to be termed as efficient, it should also be devoid of unnecessary care and eliminate any perceived inefficiency in the system. On top of this, any increase in health care cost should go hand in hand with enhanced value and efficiency of care. In these parameters, the U.S health system is far from being effective. (NCC, 1999)
The universal health care system that focuses on the community in the U.S has forever been inefficient. Rural environment where this type of care is mainly centered has been presenting exceptional challenges for health care admission. In most cases, there are deficiencies of medical personnel in rural areas as well as transportation problems. On top of these, there is the existence of distance hurdles from care as well as the ever-rising issue of economic deterioration of rural health care services.
For a long time now, majority of doctors have been shunning practicing medicine in rural areas in favor of urban places. Most of these doctors are in the pursuit of productive practices to help them in repaying high education debts that they might have incurred during their schooling days. On top of this, the doctors have been taught to make use of costly new machineries in diagnosis and treatment.
Countryside practice locations often give lower returns for doctors and have less and more ancient technology resources than cities and uptown locations. Today, graduates from medical school are giving any excuse to avoid putting up their practice in rural places. As a result, rural communities suffer severe doctor shortage, which leads to high inefficiency in terms of quality provision of health care. (Bailey, 2009)
The shortage of physicians is most evident in crucial prevention, analysis, and treatment. Public health systems and a score of other basic caregivers step in to fill in the gaps. These basic caregivers include practicing nurses, general practitioners, and community health workers.
The ever-changing technology, sky rocketing charges coupled with other market determinants have caused many rural health care systems to sink to low levels of operation. The small upcountry health care providers lack the right equipment and workforce to treat the wide range of recent diseases and injury.
Diseases like coronary bypass surgery require specialized medical personnel, which can only be accessed in big hospitals. Patients in rural hospitals have to put up with long distance to access complex medical care that is usually not available in local hospitals. This makes many patients to regard the care offered in rural hospitals to be of inferior quality. This makes people with financial means and who are able to travel to shun rural hospitals in favor of urban ones even for less complex diseases.
This negates the role of rural hospitals to treating only those people who are too weak to travel or those who cannot afford the high cost of care in urban areas. Since the small number of people visiting rural areas cannot support the hospitals’ operations, most of the hospitals end up closing.
Upon the closure of these hospitals, old people, the physically handicapped, and the underprivileged are left with no access to inpatient care. On top of this, the whole community is deprived of access to emergency care. The situation in these rural hospitals shows the inefficient nature of universal health care system that many poor people rely upon. (NCC, 1999)
As expenditures rise, public and private insurers must endeavor to manage their expenses. Prices for services include the least projected cost of providing each examination. Setting price controls adversely influence rural health systems.
Owing to the high distance between service placements, the cost per every unit of service increases compared to that of urban centers. Home based care providers in rural settings spent most of their time hopping from one home to the other to where their patients are located while an urban nurse will find their work cut out since most of their patients live in the same locality.
At the end of it all, the nurse in the city will end up visiting say ten patients while the one in the rural setting only gets to visit a maximum of two. While the urban home care provider gets paid for visiting ten patients, the one in rural areas gets paid for only three visitations despite the fact that both put up the same amount of time.
This calls for stakeholders to rethink seriously about they scheme used to reimburse health care providers in rural places if they are to attract more people to work in such places. Since this has not been the case, we cannot yet claim that universal health insurance providers has attained the required level of efficiency in providing health care in rural areas where the many people who are in need of its services are located. (NCC, 1999)
On its part, many people perceive private health care insurance as being responsible for keeping in check the medical cost inflation experienced in the 1980’s through reducing unnecessary hospital care, forcing providers to reduce their prices, and causing the whole health care industry to gain more efficiency and competitiveness.
This was achieved through private insurance policy of managed care plans. Although consumers first saw managed care plan as their solution to more efficient health care provision, its fast growth led to consumer criticism.
Most of the private health insurers are concerned with making profits than they are concerned with patient’s health. Today, many people believe that private insurers decrease the time that a doctor spends with his patient. Statistics also show that it has become harder for patients to book an appointment with a consultant. On top of this, patients are unable to produce any meaningful health care savings. (Star, 1994)
There have been claims from discontented patients and customer-support groups who claim that managed care initiatives control cost by disallowing required medical services to patients. These disgruntled parties claim that this happens even in life threatening circumstances. There have also been claims that most private health care insurers provide low-quality care that would cost them less money.
This shows that private health insurance is yet to attain the efficiency level that Americans expect. The U.S health care system is tasked with the primary goals of providing high-value care, ready admission to the scheme, and reasonable prices. The realistic problem in proving health care is that following whichever two of these objectives magnifies the third. Therefore, a readily available system of high-value care tends to increase the cost, while a lower cost scheme that is readily available often leads to low quality levels. (Cleveland, 2002)
This makes it important for people to realize that certain reasons of inflated health care prices are advantageous and expected. These are issues like an aging populace and the innovation of latest drugs and equipments. However, other causes of increased health care are unacceptable.
These include the existence of profit minded care organizations that divert billions of health care dollars to their private coffers. If all the existing issues are looked at, there is much room left for the operation of a more efficient and accountable health care delivery scheme in America at a more cost effective price.
Until America gets to that point, people will continue clamoring for a more efficient health care insurance scheme. Since the biggest challenge to attaining a more efficient health care system is good use of resources, there is need for all stakeholders to come up with modalities that address this issue. In the future, the country will still experience the problem of limitless demand against diminishing resources.
This calls for the need to make some hard decisions about what services are to be funded and which are to be ignored. While trying to contain inflation there is also the need to maintain high quality standards in medical care as well as provide better access to the system. As it is right now, both the community and private health care insurance schemes have serious flaws that make them far from being efficient. (Cleveland, 2002)
Political Influence
The provision of medical insurance has been experiencing interference from the political class in America for a long time. Medical insurance has become the subject of every presidential campaign. American presidents have been trying to dictate which medical insurance plan is suitable for the people.
Since different presidents have had different views regarding which system is the best, there have been great misunderstandings between different stakeholders. This has led to the number of Americans without insurance cover to go up in recent years. In the early period of the 1970’s, President Richard Nixon took conscious steps to change American health care from its traditional mode of not-for-profit business philosophy in to a for-profit model that would be under the insurance industry.
This led to congress passing the Health Maintenance Organization Act, which brought some sanity in the business. Although the scheme received acclamation from the public, it lost favor among the public who viewed it as a scheme by organizations to make money from hapless citizens at the expense of their health.
In his office days, President Bill Clinton termed the country’s health care system as “badly broken” and advised that it needed urgent repairs if all Americans were to benefit from the scheme. The president outlined a reform package that would be based on provision of universal health insurance for every American citizen. (Star, 1994)
According to the plan, the federal government would play a key role in funding health care services. According to the president, a new law would be created that would bar people from enrolling in private insurance schemes. In the new scheme, both employers and individuals would be compelled to contribute to meet the insurance cost. This proposal received praise and criticism from different quarters.
The crisis that President Clinton tried to address was out of concern from the high rate at which health care costs were increasing. At the time, Americans were using a large percentage of their earning on medical care. There was also concern over the high managerial costs that the system was spending and the high number of American citizens who were without insurance cover.
According to sources, the average American spends about 11% of his income on medical care. According to the same source, this figure is expected to rise to about 17% in the next 10-15 years. Coupled to this, the costs of administration constitutes 12% of the overall health care expenditures and at any given time an average of 13% of Americans are without medical insurance cover. (Star, 1994)
According to Clinton, the situation in the health care industry arose due to the use of scarce resources. He reasoned that since all resources have different uses, there are times when one has to quit using some goods in favor of others. This means that consumers will always buy products based on their economic value. When the price of an economic commodity goes up, people tend to preserve the consumption of that product. Clinton reasoned that the consumption of medical insurance would go up if a third party were paying for it.
The people who were opposing this plan claimed that if the government took the responsibility of meeting the full cost of medical insurance, then Americans would never know the real value of medical cover. According to skeptics, this would be like giving free goods to a child who would never know the true value of them. Simply put, this means that people would misuse the scheme since they were not involved in funding it. (Star, 1994)
Although Clinton’s reform program was much hyped, it never saw the light of day once it got into congress. Republicans did everything within their power to ensure that the reforms never sailed through. At the end of it all, Clinton had not only lost his reform agenda but he had also been accused of leading Americans into an illusion. The collapse of the proposed Clinton health care reforms is touted to be one of the worst failures that a government plan has received in the recent past.
Considering the groundwork that had been put up by Democrats and their fellow Republicans who were considered lukewarm, one soon realizes that reforming the health sector in America is not as easy as people think. This is partly because there are vested interests from different stakeholders. Bill Clintons’ reform package probably remains the closest thing that Americans ever came to getting a consensus in to the health care insurance debate.
However, due to majority of politicians favoring the universal health care system, it has remained as the most favorable scheme among Americans who consider private insurance as more concerned about making profits than it is in taking care of people’s health. (Star, 1994)
The health care reform debate was re-ignited once President Barack Obama came to power in 2008. Perhaps taking the cue from his fellow democrat Bill Clinton, Obama came up with reforms that sought to make health care insurance affordable for all Americans. President Obama proposed that the existing universal health insurance was supposed to be made more attractive for it to be able to effectively compete with the private insurance schemes.
According to Obama, this would give Americans a wide variety of choices, make the health care sector become more viable, and make insurance companies become more honest. However, this scheme received instant rejection from Republican lawmakers who viewed it as undermining the spirit of competition in the health insurance industry.
The lawmakers claimed that forcing liberal markets to compete with government-funded programs was creating an uneven playing ground, something that went against the rules of running free markets. Despite rejections by Republican lawmakers and other stakeholders, America is still gravitating toward a fully government-funded health insurance scheme.
Today, the governments pay accounts for about 47% of all health care expenses. This is done through schemes such as Medicare, Medicaid, and the state sponsored Children Health Insurance Program (SCHIP). If the government manages to carry through with its public health scheme, the total amount that the government chips in the health insurance sector would significantly go up. (Bailey, 2009)
Today, the number of Americans covered by private health insurance totals to about 170 million. Employers enroll majority of these people in the scheme.
If the Obama health care plan sails through congress, the premiums that the public pays in the universal health care scheme would go down by between 30-40%. Although this seems to be a great move, analysts claim that it is ill advised since it is achieved by forcing price regulations. Despite the fact that lowering the premiums would attract more people to join health insurance, the scheme has its shortcomings.
According to analysts, the lower premiums would push employers to do away with the private insurance and enroll their workers in the universal health scheme. Analysts predict that if the Obama health package sails through, it would reduce the number of Americans enrolled in the private health scheme to only 50 million down from 170 million. The Nixon, Clinton, and Obama examples show just how U.S presidents have been trying to dictate which health care insurance plan is fit for Americans. (Live Pulse, 2010)
Private Funding
About 85% of Americans have membership in a type of medical insurance scheme. This is either through some form of private health insurance or universal insurance programs provided for by the government. Majority of Americans receive funding for their health insurance from employers.
The employers meet a large amount of the health insurance cost. From the beginning of 2001, the premiums for family coverage have gone up by 78%. On top of the employer contributions, workers under the employer-sponsored insurance scheme are also required to contribute a certain percentage of the total cost.
Every time someone goes to receive medical attention, he is supposed to pay a small fee that the insurance company does not meet. This is done in form of deductions and co-payments. A very small percentage of Americans pay for health insurance from their pockets. Some states have also come up with “high-risk insurance pools” (HRPs) to provide medical cover to people whose health status bars them from accessing coverage under the private health insurance scheme.
Under this scheme, the state governments enter into an agreement with private health insurance providers to allow them to manage the pool. In return, the private insurers are required to offer a variety of health plan options to that group of people who are considered “medically uninsurable”.
The private insurance companies charge higher premiums for HRP patients than those charged for the ordinary people. This pool is funded by money from the state revenue collections. The federal government also chips in some money to help the state governments to set up and fund this pool. (Bailey, 2009)
In the universal scheme, government initiatives directly cover about 27.8% of the total population. These include the elderly people, physically handicapped, children, and a certain fraction of the extremely poor. On top of this, there is a federal law that allows public access to emergency services regardless of whether they are in an insurance scheme or not. The public scheme uses almost 57% of the total sum spend in the health care insurance sector.
Charity organizations also contribute a sizable amount of money toward the universal health scheme. This money comes from non-profit organizations, religious organizations, and services donated by employees to aid the poor. Overall, both the private and the public health schemes heavily rely on third parties to meet the cost of health care. Analysts observe this as one reason why the cost of providing health care has been on the rise. (Bailey, 2009)
Achievements of the two schemes
Over the last fifty years, the phenomenal rise in medical usage has been one of the most outstanding occurrences in the health care industry. Over the years, the total health care expenditures as total share of GDP have grown threefold from the paltry figure of 5% to about 14% at the turn of the century.
According to analysts, this commendable growth was because of the vigorous campaign put in promoting health insurance. Studies show that the consumption of medical usage began showing an upward growth in 1965 when the government introduced the Medicare program.
Prior to this, the only health insurance cover available to Americans was the private one that many people could not afford. Today, Medicare is one of the major health insurance plans in the world benefiting close to 40 million people and spending a big fraction of the federal budget as well as 2% of the country’s GDP. Before the introduction of Medicare, universal health insurance was unheard of and the private health insurance schemes available then did not cover the aged.
During this time, elderly patients or their relatives had to meet all the medical cost. Once Medicare was introduced in 1965, the enrollment of elderly people went up by almost 100%. Today, even the private health insurance sector has come up with programs destined specifically for the elderly population. (Cleveland, 2002)
By looking at the two schemes, it is prudent to say that both have helped in putting each other in check. The introduction of Medicare has done a great deal in streamlining the health insurance industry which prior to this was only run by private health insurers.
Although the elderly population constituted of only 10% of the total population, their contributions totaled to about 20% of the total expenditure at the time. Today the equation is level between the age divide. Alternatively, many people were able to join insurance schemes after the introduction of Medicaid. Although the universal health insurance program is not anywhere near perfect, it is still a relief for many American people who cannot afford the cost of private medical insurance.
The competition generated by the existence of the two schemes has helped to streamline the industry. However, more work needs to be done if the two schemes are to be effective. Key among this would be to bring down the inflated costs of health insurance and to provide more quality services for Americans. It is also important to look at the group of people who lack medical insurance because they do not fit into any scheme. This group of people earns more money that disqualifies them from joining the public insurance scheme.
At the same time, their salary cannot allow them to fit in the private insurance scheme making them to remain uninsured. However, state governments have been doing an extra job to ensure that these people get group insurance that is given to groups of small employers. All these developments can only be credited to the introduction of public health insurance and especially Medicare. (Cleveland, 2002)
Final Analysis
From the look of things, the woes bedeviling health care insurance are far from being over. Neither the universal nor the private health insurance is capable of solving America’s health care woes on its own. The best insurance scheme would be the one that seeks to reduce the inflated costs of obtaining health insurance.
While the universal health care scheme that most politicians have been routing for tends to gravitate towards this end, it does not actually attain this objective. If the Obama proposed health care overhaul is implemented, it would cost the exchequer about $115 billion in unrestricted spending over ten years more than the initial projections.
If congress approves the plan, the added spending would see the expected revamp costing over $1 trillion. This would go against the people’s wish of seeing a health care reform that brings down the cost of health insurance. This shows that while the program is laudable, it cannot be relied to bring about the much-needed efficiency lacking in the health insurance sector.
Running a universal health insurance scheme that forces people to give up their membership on private health insurance is not only illegal but also lacks morals. The proposed universal health scheme also goes against the tenets of market-based competition. This is because a universal health scheme would give the government an upper hand and hence knock private health insurers out of business. (Cleveland, 2002)
The best health care insurance for Americans would be the one that balances between the universal and private health insurance. This can be achieved by putting the compensation to doctors and hospitals proposed under the universal health insurance at the middle between Medicare and private insurance.
In this set-up, the number of people under private insurance would only drop to 67 million. This would be a big relief given the original figure of 120 million people that the private insurance scheme would lose if the government pushed ahead with its plan to adopt a universal health insurance for all Americans.
The best thing about setting up a corresponding public insurance scheme is that America would end up with an unambiguous two level medical insurance system where citizens insured under the private scheme would have an access to superior medical care. Some developed countries have also come up with this form of a health care insurance scheme.
In the U.K, more people are opting to enroll for private insurance other than enrolling in the government’s National Health Service. This would mean that privately insured Americans got higher quality health care compared to their colleagues in the universal insurance scheme. This policy will not work any time soon since majority of the political class favor the creation of a universal health over private health care insurance issuers. (Live Pulse, 2010)
Conclusion
The health insurance debate has continued to generate heated debate for a long period. Given the vested interests in the different schemes, the debate is not about to die any time soon.
Caught in the middle are American citizens who have to content with inflated prices and others who have to go without insurance cover simply because they cannot afford it. The political elite has been trying to come up with a universal health insurance that focuses on the public. Another group has been pushing for the striking of a balance between the universal and private health schemes.
This tug of war between the divergent groups has made prices in health insurance to soar to levels where most Americans are unable to afford. As it is, both the private and the universal health schemes as they exist today lack efficiency and until they are streamlined, Americans will continue to demand more value for their money. This should be done with haste in order to put America’s health insurance in the same rank with that of other developed economies.
This scenario provides uncertainty facing the XYZ Health insurance regarding the effects of adding the cost of premiums as a result of increasing standard of living because of recession and some risk factors that affects the amount of premiums that needs to be paid.
In order for the XYZ Health to determine the most reasonable increase that will be appropriate in order to avoid making the insured patients seek alternative medical options, it will be of essence for XYZ Health to use statistical analysis to determine the most appropriate premium additions that will aid in the decision making process.
The major aim of this analysis is thus to give reasonable estimates of using statistical tools based on the given data and other external factors to determine the most appropriate premium amount in dollars that will be reasonable for the XYZ Health to add without affection the decision making process of the insured people. Confidence level based on the mean, median and the standard deviation using SPSS will be appropriate in this case (Cooper, 2008).
Probability concepts
During the investigation of XYZ’s health insurance scheme, we looked at various methods of sampling data to come up with conclusive results to use in decision making. Various probability concepts could be used in this scenario, however we narrowed them down to these methods; confidence intervals, point estimates and Poisson distribution.
The probability concepts can be discussed as; the use of point estimates is applicable when it’s used to analyze a single number, in that it is limited to estimating up to a single figure, in this case a single amount like $40.While, confidence interval concept is a statistical method used to sample an array of diverse numbers or scores to come up with a level of accuracy and the figure is expressed in percentages.
Finally the Poisson distribution method is used in sampling the occurrence of various averaged numbers within a specified fixed time and if the occurrence of these numbers are time independent of the last occurrence. Poisson distribution method relies on probability of occurrences and is suited for scenarios which require speculation.
Due to the fact that XYZ sampled a small section of employees within the geographical are they operate; the probability concept that would be most appropriate to apply was the confidence interval method. This is because we were sampling various premium rates provided by employees, which they would comfortable with.
The use of the confidence interval method enables us to come up with a figure which estimates with high accuracy levels of the amount employees would be willing to increase to their insurance premium. Thus in this case confidence interval probability method would be the most suitable approach to use.
Statistical analysis
Based on the data given, statistical analysis to determine the mean, median, variance and standard deviation are done using spreadsheet and SPSS as shown below;
Mean
=$47.225
Median
The middle numbers are 48 and 49 hence
= (48+49)/2 =$48.5
Variance
= 100.9994
Standard deviation
= $10.04984
As shown in the above calculations, the mean is about $47.225 and the standard deviation is about $10.04984 which shows that the dispersion about the mean which is $47.225 is about $10.04984, the standard deviation thus shows the minimum and the maximum amount of dollars that the sample group could tolerate before reaching the ‘breaking point’.
In order to appropriately determine the minimum and the maximum amount that XYZ Health can afford to add without affecting the clients commitment is determined more accurately using SPSS statistical tool.
As shown in the SPSS output, the 95 % confidence level is gained through determination of the maximum and the minimum amount of dollars that the clients are willing to tolerate without opting for other means of taking care of their health insurance. From the SPSS output, the minimum amount is about $44.01 and the maximum is about $50.44.
The XYZ Health can thus add amount between these two figures without affecting the perception or the decision making process of the clients. The figure presented here is based on the dispersion range from the mean which thus present 95 % confidence level. The data distribution above shows the ranges of data based on the standard deviation, the standard deviation marked by red arrows shows the ‘tolerable’ ranges which the clients will not be lost.
The maximum and the minimum amount based on the standard deviation are about $57.27 and $37.19, these values are within acceptable rates but the SPSS confidence level presents a more precise and accurate figure of about $44.01and $50.44.
Accuracy of probability concept
When using the various probability concepts we have to look and determine the accuracy and precision of using these methods. Accuracy and precision help an organization to come up with decisions which to a certainty will make them achieve their business goals.
With the use of point estimate method as statistical sampling technique, we arbitrarily come up with a certain amount to use as an insurance premium increase. This method is not an appropriate concept due to the fact that high accuracy and precision levels cannot be achieved (Lind, 2008).
In the case of Poisson distribution method being used in probability sampling, the accuracy and precision levels are high but they are not appropriate to be used in the scenario of XYZ Health Company. Poisson distribution method’s accuracy levels in this case would low in the range of 60-70%, owing to the fact that this method when used it is tied to occurrences of numbers or events in relation to time.
However XYZ Company’s insurance scheme is not to be implemented within a specific time range as the amount that agreed on will not be tied to the previous figures but due to sampled amount that matches the employees’ expectations.
Accuracy and precision levels with the use of confidence interval method are high and appropriate to this case. The accuracy levels with the use of this method range from 90 and 95%, this is because this method when used with sampled data, it calculates the confidence interval by using the mean (Broyles, 2006).
Confidence levels of 90% and above have fewer marginal errors in coming up with a desired figure or amount to be used, this is an advantage in that the organization will used results from the sampled data to come up with decisions which can be easily agreed to.
Recommendations
Based on the statistical data analysis, the premium rates should not exceed $50.44, this is the highest level that the premiums can be raised by XYZ Health without affecting its clients. The SPSS 95 % confidence level as calculated above supports this figure and hence useful for the firm decision making process regarding its addition of premium cost. The minimum figure that the firm needs to add is $44.01; this figure will provide an even more comfortable addition for most of the clients of the XYZ Health (Broyles, 2006).
I would therefore advice the XYZ Health to add at least $44.01 and not exceed $50, the rationale for this is purely based on the statistical 95 % confidence level which has projected that this range will be suitable for the XYZ Health to add without affecting the loyalty of the clients. The other imperative recommendation that I will give the company regarding the increase of premium is the need to cut down on the other costs through downsizing schemes in order to avoid passing on the overall cost to the customer.
Conclusion
As described in this analysis based on the statistical manipulations, the most suitable range for the XYZ Health to add on its premiums without affecting the response of the clientele is $44.01 to $50, this range provides what is statistically called 95 % confidence level. It is thus recommended for the insurance firm to base its decision making process on this statistics in order to maintain the clientele while trading off the increased cost which necessitated the increase of the premium rates.
On the other hand it is advisable for the firm to look for ways of minimizing the cost as a result of the external factors that the company has no control. One of such ways is company downsizing, this can be easily done to reduce the cost incurred by the company and enable the insurance firm to use the least addition to its clients.
References
Broyles, W. R. (2006). Fundamentals of statistics in health administration. Sudbury, MA: Jones and Barrlett.
Cooper, D. R., & Schindler, P. S. (2008). Business research methods (10th ed.). New York, NY: McGraw-Hill/Irwin.
Lind, D. A., Marchal, W. G., & Wathen, S. A. (2008). Statistical techniques in business & economics (13th ed.). New York, NY: McGraw-Hill/Irwin.
Medicare plays an important role in the United States system of health care by providing more than 45 million American citizens with insurance cover. Medicare is a program established to provide health insurance to individuals regardless of the status of health and income level. Although it is mainly established to cater for health needs of the elderly (65 years and above), the program caters for the needs of about 7 million permanently disabled adults.
Registered members contribute a certain amount of money throughout their working life so that together with their spouses, their health needs are catered for after they have retired. In order to meet the financial obligations faced by the Medicare system, funds have to be sourced from beneficiaries, revenues from the federal government and tax. At present, nearly all people aged 65 and above are insured by Medicare. Although it is a popular program, Medicare is currently faced with many challenges and issues.
Issues Facing Medicare
The greatest challenge facing Medicare is lack of sufficient funds to cater for health needs of the future generation. This is because of the high cost of health care and the increased number of baby boomers in the United States. Annual increase in the cost of health care has in turn increased expenditure. Studies conducted in 2010 show that the number of Medicare beneficiaries is likely to rise from 47 to 78 million by 2030.
For instance, the estimated population of Baby Boomers expected to join Medicare in 2011 (individuals born between 1946 and 1964) was 77 million. To handle this number, Medicare needs some improvements. According to the Medicare Board of Trustees, if changes on the Medicare program are no put in place, the likelihood of the program being insolvent/bankrupt by 2024 is high.
The following measures have been suggested if the Medicare Trust Fund is to be financially stable beyond 2024. The salaries of physicians should be reduced by 40% and payments made to other companies providing services to the programs will also be deducted.
According to government experts, available funds in Medicare Part A Trust Fund will not be enough to cater for full benefits of the large population. The experts also argue that the program requires additional revenue if it is to maintain the current benefits. This implies that beneficiaries will be forced to bear the burden of increased premiums.
Today, 30% of the cost of healthcare comes from the pockets of the beneficiaries. These costs increased annually. Like health care expenditure, increased spending in Medicare is caused by the high cost of services offered in health systems, new technologies, and increased utilization of services.
The increased amount of funds utilized in the Medicare program influence smooth running of other programs. For instance, annual expenditure is expected to increase to about $3 trillion in 2030. The federal government will be forced to adjust the budget to accommodate the requirement of the program.
This will affect funding of other important sectors like education and defense. Because of the increased number of retirees, Medicare will lack funding because the workers will be few. This is because Baby Boomers include the largest percentage of employees in the United States. The economy of United States is largely determined by Baby Boomers because they are innovative. In addition to lack of funds, the program will need to hire more professionals to cater for the large number of retirees.
The insurance industry is one of the most vibrant sectors of the US economy. Health is one of the largest insurance sectors. The importance of health insurance to the health status of Americans necessitated the formulation of various laws to control the industry.
Health Insurance Portability and Accountability Act (HIPAA) and the Patient Protection and Affordable Care Act (PPACA) are some of the laws that regulate the industry.
The laws have improved the transparency of the industry and increased the affordability of insurance. The laws help in determining the legality of various actions of insurance companies.
Can an insurance company require insurance recipients to pay a different premium for the same coverage? Is this legal? If yes, what law or statues take precedence? If no, which law or statue takes precedence?
Insurance companies should not charge insurance recipients different premiums for the same coverage. Patient Protection and Affordable Care Act (PPACA) prohibits insurance companies from charging different premiums to insurance recipients due to a pre-existing condition or gender.
PPACA strives to reduce the number of Americans who do not have insurance. Charging uniform rates makes it easy for people to access insurance. This is because in most instances the exorbitant charges of most insurance companies are the major factor that prohibits people from seeking health insurance (Atlas, 2010).
However, insurance companies may still charge different premiums depending on the risk factors of the insured. These include age and occupation.
Can the insurance company require the insurance recipient to undergo required tests? What if the insurance recipient refuses to comply with the testing requirement?
Insurance companies use various actuarial techniques to calculate the premiums that the insured should pay. The calculations take into consideration the risks that the insured faces. Therefore, it is vital for insurance companies to obtain all the necessary data in order to calculate the risks that the insured faces.
Failure to provide the correct data would make the insured pay the wrong premiums. The insurance principle of utmost good faith necessitates the insured to provide correct information that is relevant to the insurance cover.
Failure to provide the correct information would make the insurance company fail to pay the insured if the event that the insured is covered against occurs. In some instances, the insurance company may require the insured to undergo various tests to determine the health status of the insured.
People who have ill health usually pay higher premiums than healthy people. The lifestyle of the individual also determines the premium that the individual would pay. Smokers usually pay higher premiums than non-smokers (Hammaker & Tomlinson, 2010).
The insured is at liberty to refuse to undergo the tests. However, should this occur, the insurance company would require the insured individual to pay higher premiums. Therefore, it is vital for the insured individual to undergo the tests. This may help the insured individual pay premiums that are much lower.
Is the insurance company discriminating again the insurance recipients who have heredity or predisposing health risk factors. Why or why not? If so, is this practice ethical?
Insurance companies require people to undergo various medical tests. Some of the tests include blood pressure check, cholesterol check, and blood glucose check. The tests provide an indication of the likelihood of the individual having health problems.
This helps the insurance company to calculate the right premium that the individual should pay. Failure to calculate the right amount of premium would make the insurance company lose vast sums of money. The insurance company may require people who have various health conditions to pay higher premiums.
This is because people who have various health conditions have a high likelihood of claiming payments from the insurance company. It is vital for insurance to maintain their profitability. If many people claim payments from the insurance company, the company may have huge losses (Garman & Forgue, 2011).
Therefore, it is not unethical for insurance companies to charge people who have hereditary or predisposing health risk factors higher premiums. However, PPACA prohibits companies from discriminating insurance recipients due to hereditary or predisposing health conditions.
Is the health insurance company legally and/or ethically required to offer assistance for insurance recipients who need to lower their rating? Support your opinion.
The health status of an individual determines the premium that the individual should pay. The insurance company should offer assistance to people who need to lower their ratings. Failure to provide assistance would make the insurance recipients continue paying higher premiums.
This would make the insurance company charge the insurance recipients higher premiums. This would mean that the insurance company would be fleecing unsuspecting insurance recipients (Scorsone, Levine & Justice, 2012).
Therefore, it is unethical for insurance companies to fail to provide insurance recipients with information on how they can reduce their ratings.
Conclusion
Insurance companies are primarily business ventures. Therefore, it is vital for companies to maintain their profitability. However, in so doing, they should not fleece unsuspecting clients. They should ensure that they charge attractive premiums to attract and maintain their clients.
Various federal legislations ensure that insurance companies engage in ethical practices. In addition, states have laws that regulate the activities of insurance companies.
References
Atlas, S.W. (2010). Reforming America’s Health Care System: The Flawed Vision of ObamaCare. Stanford, CA: Hoover Press.
According to the UN, children are one of the most vulnerable populations (Burns, Dunn, Brady, Starr, & Blosser, 2013). Despite the efforts of the U.S. government to ensure a thorough health care coverage for all children who are residents of the country, there remains a number of children who are uninsured and have no access to medical care, usually due to the parents’ low income and difficult living conditions (HRSA, 2015). This paper aims to examine the gaps in pediatric care coverage, as well as the reasons for these shortcomings.
Analysis
HRSA’s (2015) analysis of health care use by pediatric population shows that the primary source of pediatric care is the doctor’s office: “Among children with a usual source of care in 2012, 74.2 percent of children used a doctor’s office; 23.9 percent used a clinic; and 1.9 percent used the hospital and other places, including emergency rooms and hospital outpatient departments” (p. 91). However, the preferred source of care varies considerably by family income, as well as race and ethnicity. For instance, HRSA (2015) states that children with household incomes of less than 200 percent of poverty were about twice as likely to use a clinic as a usual source of care than children with higher household incomes. Insurance coverage provided to children is either public or private, with private insurance usually being provided by the parent’s employer and public insurance supported by Medicaid or state-governed plans (HRSA, 2015). Children’s insurance coverage varies between populations: where the prevalent type of insurance for non-Hispanic white children is private (68.6), non-Hispanic black children are twice more likely to use public insurance (58.8) (HRSA, 2015). The percentage of uninsured children is high in Hispanic and native populations – 11.8 and 11.9 respectively (HRSA, 2015). The overall percentage of uninsured children has been gradually decreasing over the past decade but remains relatively high at 6.6 (HRSA, 2015).
Therefore, the lack of universal insurance coverage is evident, meaning that the current health care sources of the U.S. are not sufficient to cover the entire pediatric population. The majority of child populations that are affected by these impairments are racial and ethnic minorities, such as Hispanic, Native American, and Black (HRSA, 2015). However, the family income also plays a vital role in health care access (HRSA, 2015). One of the main reasons for the difficulties in health care access is the refusal of some states to adopt the Affordable Care Act of 2010 and the Medicaid expansion. According to Blumental, Abrams, and Nuzum (2015), the Medicaid expansion has been effective in lowering the rate of uninsured persons and increasing access to health care, particularly in the low-income, Hispanic, and Black populations: “Groups that have historically been at the greatest risk for lacking insurance — young adults, Hispanics, blacks, and those with low incomes — have made the greatest coverage gains” (p. 2451). The overall number of uninsured persons declined from 16.4 million to 7.0 million over the 5-year period (Blumental et al., 2015). Nevertheless, there are 19 states that have not adopted the expansion act yet, which means that the health care access of vulnerable children in these states remains limited.
Conclusion
Overall, it is clear that the vast part of the pediatric population with limited access to healthcare is from low-income, Hispanic, and Black households (HRSA, 2015). The primary barrier that prevents their access to health care is limited public insurance. The ACA has managed to expand health insurance in some states; however, while there are still states that refuse to accept the expansion, the children living in these states will be subject to impaired health insurance and care.
References
Blumental, D., Abrams, M., & Nuzum, R. (2015). The Affordable Care Act at 5 years. The New England Journal of Medicine, 372(25), 2451-2458.
Burns, C. E., Dunn, A. M., Brady, M. A., Starr, N. B., & Blosser, C. G. (2013). Pediatric primary care (5th ed.). Philadelphia, PA: Saunders.
U.S. Department of Health and Human Services, Health Resources and Services Administration (HRSA). (2015). Child health USA 2014. Rockville, MD: U.S. Department of Health and Human Services. Web.
The implementation of “Health Insurance Exchange” in the framework of Obamacare program is likely to have a significant impact on three critical aspects: customers’ demand, pricing policy, and supply.
First, and foremost, it is necessary to focus on the changes that are likely to take place in the customers’ demand field. The implementation of the relevant law has transformed the basic principles of demand formation. Thus, people that used to choose whether to purchase a health insurance or not basing on their inner motives and estimations are now legally obliged to have an insurance coverage. Therefore, the major difference resides in the fact that the customers’ demand is now regulated by law. From the perspective of a “free market”, the relevant intervention is rather unfavorable. The artificial raising of customers’ demand minimizes the regulation power of clients in price setting due to the fact that the level of competitiveness in the insurance market will sag significantly (Glied and Ma 9). In the meantime, some specialists note, the increase in the demand is not as crucial for the market as it might seem. It is presumed that even though more people will now have a medical health insurance, the majority of them will not use the medical services more frequently than they used to do (Brezina et al. 194). In other words, people who purchase health insurance will not necessarily use them in practice. Therefore, the pressure on the supply sector might turn out to be less critical than one might expect.
The lack of balance between demand and supply is likely to have a negative impact on price setting. According to the basic principles of the law of the market, the decrease in supply leads to the inevitable cost rising. Thus, many analysts state that the implementation of the relevant law deprives American people of the right to control and regulate the costs of their medical service (Boyes and Melvin 89). Therefore, health insurance companies will receive a chance to impose higher costs for less medical care. Thus, the principal argument of the supporters of the Obamacare program that the new regulation provides equal terms for receiving the service seems to be irrelevant. In order to compensate for the reduced prices offered to particular social groups, health insurance companies will raise the costs of service for other people (Holahah and Garrett 2).
In addition, the implementation of the relevant law is likely to have negative outcomes from the standpoint of supply. Hence, according to the experts’ opinion, the health care market will face the problem of the supply shortage due to the sharp increase in customers’ demand. Most specialists agree on the point that the system overload is inevitable with the implementation of the new regulations (Mulligan 3). The American health care workforce has experienced the shortage of specialists for several decades. Now that the demand will rise significantly, there is no doubt that this shortage will become particularly critical. The decrease in supply is likely to result in a series of negative consequences such as additional difficulties in accessing providers, reduced time of service, increased cost, extended waiting time, and the general decline of the quality of the care delivery (Anderson par.2).
The relevant analysis shows the close interconnection between demand, cost, and supply. The principal negative impact of implementing “Health Insurance Exchange”, therefore, resides in disrupting the balance between these elements that is critical for a “free market”.
Boyes, William, and Michael Melvin. Microeconomics, Boston, Massachusetts: Cengage Learning, 2015. Print.
Brezina, Paul, Anish Shah, Evan Myers, Andy Huang, and Alan DeCherney. ” How Obamacare Will Impact Reproductive Health.” Seminars in Reproductive Medicine Journal 31.1 (2013): 189-197. Print.
For health insurance to be effective, different aspects must be put into consideration. Universal coverage is a basic element of health insurance. Health insurance should cover majority of citizens in a particular country. In addition, health insurance should be continuous. Continuity allows early detection of a disease and uninterrupted treatment.
Moreover, health insurance should be affordable to low income families and individuals (Gunnar, 2006).Affordability includes incentives, inflation controls and cost to offer cost-effective services.
As a result, health insurance can be accessible to low-income individuals and families. Health insurance should promote health and well-being of those it covers. It should include mental health and preventive services. These elements can be summarized as: efficiency, effectiveness, patient-centered services, timeliness and equity (Quadagno, 2005).
There are several associated with the use of employment based coverage. Quadagno states (2005) that research has made it evident that it is always cheap for a worker to get a health insurance through his employer than doing it himself. It is because the employer can negotiate prices with issuers because he represents many workers.
This also becomes easy for the insurance company because it spends less per person as compared to insuring an individual. It is an advantage to the issuer in that the financial risks are spread over a group of people. In addition, the program ensures delivery of quality healthcare services. As a result, innovativeness is a key element in this program.
Employer based health insurance has drawbacks too. First, all citizens cannot have access to it because employers offer coverage to their employees only. In addition, if an employee decides to quit his job or resign he losses his coverage. In addition, the choices of healthcare plans are limited because the company intents to minimize the costs. Employer based insurance lacks universal coverage. As a result, the program lacks portability and benefits are not transferable (Quadagno, 2005).
There are basic elements which need to be incorporated in health insurance programs to ensure the poor and uninsured have access to insurance health. These elements should ensure services have the following characteristics: affordable, cost-shared, accessible, extended scope of benefits and financed.
The best way that has been known to provide health care to the poor and non insured is through provision of affordable premiums. Statistics show that nine out of ten of the uninsured families and individuals are classified as poor or low-income group (Gunnar, 2006).The premiums offered are expensive and this group of persons cannot afford to pay. Provision of affordable premiums can accommodate the poor and low-income persons (Quadagno, 2005).
Poor families and individuals are at high risk of being uninsured. In addition, this group of uninsured persons is in moderate or low income families. Cost sharing is essential in provision of health insurance to the poor and uninsured. The employers can contribute towards the payment of premiums for their employees. As a result, the poor can afford insurance premiums through cost sharing (Gunnar, 2006).
Stakeholders involved should review the existing health insurance programs to identify and address the gaps in accessibility of services. Insurance companies lack health insurance for children and the elderly (Gunnar, 2006). However, some insurance companies have revised eligibility of individuals to be covered to provide inclusive services.
Every citizen in a particular country should access health insurance. Services offered should be universal to ensure coverage of all citizens in a particular country. In addition, the scope of benefits should be reviewed to ensure all members of family are covered (Gunnar, 2006).
References
Gunnar, W. P. (2006). Fundamental Law That Shapes the United States Health Care System: Is Universal Health Care Realistic within the Established Paradigm, The Annals Health L., 15 (2), 151.
Quadagno, J. (2005). One nation, uninsured: Why the US has no national health insurance 5(3), 23-30.