The Role and Impact of the Health Insurance Market

The Role and Impact of the Health Insurance Market
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The Role and Impact of the Health Insurance Market
The Performance of the Health Insurance Industry
The American healthcare industry has been experiencing a slowdown, but when viewed from a long-term perspective it has made great improvements. With the yearly per capita spending increasing tenfold since late 1970, this growth can be stated to have outperformed the American economy (Levitt, Kamal, Gonzales, Cox, & Claxton, 2014). Furthermore, the industry has become so prominent that it has also surpassed those of other wealthy countries like England and Canada. Nonetheless, in spite of the increased spending in promoting health. This is so since more attention is given to the higher levels of medical spending and the challenges that are imposed on the public and private budget (Levitt, Kamal, Gonzales, Cox, & Claxton, 2014). A lot is not understood about the different components of cost development. In other words, how components in different sectors of health care differ as well as their subsidy and how the driving force in healthcare spending has evolved and changed with time. To have a better understanding of spending in the health care system, it has to be disaggregated (Levitt, Kamal, Gonzales, Cox, & Claxton, 2014). This action will provide more detailed information on what needs to be changed for, industry leaders, representatives, and the media. These changes may range from fiscal trials, development of policies and repercussions to the patient's providers and insurers if systems change. From a historical stance, it has been noted that the cost of health care has received more attention compared to the outcome (Levitt, Kamal, Gonzales, Cox, & Claxton, 2014). This can explain why good health and long life has eluded the nation’s citizens. In simpler terms, the industry players need to comprehend the amount they are utilizing, how growth is being achieved and finally, is value being received for the money (Levitt, Kamal, Gonzales, Cox, & Claxton, 2014). However, even with a viable plan for informative changes, consistent data collection may not always be available at the healthcare level.
Economic Models, Theories, or Assumptions
Recently, it has become a common business practice of insurance companies merging, carrying out joint ventures and strategic alliances. These actions have contributed heavily to the transformation of the healthcare market countrywide (Salmon, 2017). These business activities have given rise to healthcare cover that continues to grow in not only size but also geographical coverage, thus increasing their economic power. These strategies employed by the multimillion insurance companies have had an impact on the healthcare sector as it has led to the increment of hospital beds, doctors, and patients (Salmon, 2017). This horizontal growth has led to most companies reaching their supervisory limit. Now with this barrier, they have strategized to focus on vertical integration with services such as post-acute care. The rapid changes, however, come at the cost of mission discord, increased financial demand and intensified political scrutiny due to increased priva...