A report from the Commonwealth Fund Commission on health system performances projects a disturbing picture of the US healthcare system. The report emphasizes that the country falls short of what it could actually achieve for the same investment in healthcare. The report awards 66 points to the US out of a maximum 100 points, calculated on the basis of 37 national indicators including quality, access and efficiency. The report reveals that the country could save about 100,000 to 150,000 lives by just improving its performance in certain vital areas.
This is also estimated to save the country about $50 to $100 billion each year. The implications of the report was echoed by the senior vice president of the fund, Cathy Schoen who said that the unavailability of healthcare coverage and problems in access to care are driving down care quality while rising up costs in the US. Cathy also warned that the healthcare system is going in the wrong direction and urgently needs to change its course. The US is ranked 15th among the 19 countries in accounting for deaths that are preventable through medical intervention (Mahon, 2006).
Among people less than 75 years of age, there are about 115 preventable deaths for every 100,000 Americans compared to 75 to 84 among top countries. Among the industrialized nations, US has the least life expectancy at 60 and the worst infant mortality. The report card reveals a considerable gap between the best performance and the national average performance in terms of healthcare quality, access and efficiency. The Commission’s report emphasizes that by just incorporating appropriate changes in the organizing, financing and delivery system of the healthcare, the country can save considerable number of lives and money.
To illustrate this, the commission highlights that if everyone with BP and diabetes achieved care on par with the top performing levels, about $1 billion to $2 billion and 20,000 to 40,000 lives could be saved each year. The Commission has also discovered the under use of electronic medical records (EMR), with only 17% of doctors using EMR, compared to about 80% among the top three countries, as of 2001. Among other factors plaguing the system are slow dispersion and higher insurance administrative costs. About 7.
3% of the national health expenditures in the US is spent on insurance administrative costs, compared to just 2% in France and Japan. Apart from being expensive, the US healthcare system is also inadequate, with over 47 million people having no insurance and several millions more inadequately covered by insurance. The gap in spending levels and service levels may be attributed to an integrated patchy payment system involving profit based payers. Private insurers have to spend money on allied works and processes that have nothing directly related to treatment and care.
These include overhead writing, sales, marketing, coordination; which needs hospitals to allocate manpower and resources to deal with the paperwork. This unnecessary administrative procedures account for one third or 31% of the health spending. The rise in private health spending, including out-of-pocket payments and private health insurance (PHI) is expected to reach a high of 6. 6% in 2009 (CMS, 2007). Growth rate in private health spending is then expected to decline through 2017, due to the anticipated economic slow down. The current rate of rise in healthcare spending is the highest in history and the future spending looks grave.
For the year 2007, the total health expense rose by 6. 9%, which is twice the inflation rate. The total spending in 2007 was $2. 3 trillion or $7600 per person. This represents about 16% of the gross domestic product (GDP). The trend is expected to prevail for the next decade and reach $4. 2 trillion in 2016 accounting for 20% of the GDP (NCHC, 2008). The issues and difficulties associated with the US healthcare system are not restricted to the civilian sphere alone. The difficulty of funding healthcare for its citizens is also evident from the US’s running of the Veterans Health Administration or VHA.
The VHA is a part of the Department of Veterans Affairs and is the nation’s biggest integrated healthcare system. Although it has been around since 1946, it has come a long way from the mid-1990s, when some of its facilities had few patients and most facilities were dangerous and dirty. Today it provides direct healthcare at a fairly good level for the discharged veterans. However, veteran’s healthcare involves a priority enrollment system based on certain criteria to determine their eligibility and the degree of coverage. Thus not veterans may be eligible, and this eligibility may vary from year to year depending on the funding of the VHA.
Thus VHA has to ration healthcare in accordance with the funding provided by the congress (Longman, 2005). In 1996 when the congress opened the VHA facility to the 27 million veterans, the move was welcomed as being a service to the veterans who fought for the nation’s cause. However sufficient funding was not allocated for the large number of veterans who had enrolled. In 2006, it was estimated that about 15 million veterans of the 24 million throughout the United States were not enrolled with the VHA. This is against the 2005 figures when there were 7. 7 million veterans enrolled with about 4.
8 million of them receiving care. The limitations of the system are evident from the Public Law 104-262 of the Veterans Heath Care Eligibility Reform Act of 1996. Under this Act, veterans requiring healthcare are grouped into two, namely ‘eligible’ and ‘entitled’. As per the regulations ‘eligible’ means VHA may provide care, while ‘entitled’ meant VHA must provide care. But on the ground, neither was guaranteed of the services of VHA as VHA funding is set annually by the congress and when these funds are used up, care cannot be extended to anyone. VHAs healthcare system and its funding methods are complex.
VHA had admitted in 2005 that it was $1 billion short in its budget. This was mainly because the number of enrolled veterans grew by about 80% between 1999 and 2005 due to military deployment in Afghanistan and Iraq. The delivery of healthcare in the US also has relevance with the operating status of the nursing homes, thus complicating policy making. The quality and performance of healthcare rendered by these nursing homes, is highly dependent on its profit or non-profit status. Several studies have highlighted the efficiency of profit-oriented organizations compared to non-profit organizations.
In the nursing homes or long term care facility too, this is no exception, where the profit driven homes are seen to be technically and economically efficient than the non-profit facilities. The operation of the non-profit homes is directed to ensuring that revenues and costs are relatively equal. The non-profit nursing homes, run by government, religious bodies and even by private philanthropic affiliations are not seriously classified for their performance and quality, and are largely categorized together (Knox, Blankmeyer and Stutzman, 2006).
Research done into staffing levels of profit and non-profit nursing homes however, show that nursing homes in the non-profit sector have higher staffing levels, compared to profit oriented nursing organizations. Literature on nursing homes in the US shows that non-profit care facilities have higher number of direct care staff and lower staff turnover rates. It should be noted here that the majority of nursing homes in the US are profit oriented while in Canada; the majority are non-profit care homes (Margaret et al. , 2005).