Week 12: Health Care Financing

Pradhan (n.d). describes the definition of healthcare financing as a gathering of funds for use in healthcare and allocating these funds to places and populations that need the funds for specific healthcare issues. Funding comes from sources such as healthcare insurance which is generated through employment based insurance coverage premiums and there is also the government’s contributions to healthcare funding through the national budget that is created every year. These contributions better known as Medicare and Medicaid are healthcare insurance programs administered through the Center for Medicare and Medicaid Services and primarily provide healthcare coverage to a specific part of the population along with the Children’s Health Insurance Program (CHIP).

The U.S. Dept of Labor reported that approximately two thirds of the population was covered through employment-based medical plans (www.dol.gov, 2001). This appears to be old data but a more recent report by the Robert J Wood Foundation shows that that number is now about 60% and declining (www.rwjf.org, 2013). The report gave numerous the reasons for this decline as: fewer employers are offering employer sponsored insurance coverage and fewer employees are accepting what is offered; insurance premium costs have been rising steadily; just as the portion of the premium employees had to pay has risen while the dollar amounts of contributions from employees has doubled;  more young adults are receiving coverage from employer sponsored insurance plans; these employer sponsored insurance rates vary across states with some significance and the sector of the population with lower income is the most affected (www.rwjf.org, 2013).

From the above discussion employment, both employers and employees, has a significant role in contributing to healthcare financing. Employees, both full-time and part-time have the option of purchasing healthcare insurance coverage through their employer. Employers on the other hand are mandated to offer insurance benefits to full-time employees at the best rate they can negotiate with the insurance provider depending on how many employees will purchase the insurance plan. The question I ask is how this will be affected if the policy for full-time employment to be defined as 40 hours per week is passed. As mentioned in previous weeks the concern has been that employers may try to take advantage of the policy leaving employees with no healthcare insurance and these employees possibly becoming dependent on the government either through Medicaid or other programs causing a burden on healthcare financing.

It is therefore very important that the effects of this new policy be completely analyzed in order to ascertain that it will cause the most benefit and minimize negative consequences from its passage. Even I have to admit that not everything that is god for the goose is also good for the gander but I also know that not everyone can be satisfied by every decision and ultimately the impact with the most positive effects is what needs to be done.

References

Pradhan, P. (n.d). Health Care Financing. Retrieved from www.pitt.edu/~super7/16011-17001/16161.ppt

Robert J. Wood Foundation. (2013). Number of Americans Obtaining Health Insurance Through an Employer Declines Steadily Since 2000. Retrieved from http://www.rwjf.org/en/library/articles-and-news/2013/04/number-of-americans-obtaining-health-insurance-through-an-employ.html

United States Department of Labor. (2001). Report of the Working Group on Challenges to the Employment-Based Healthcare System. Retrieved from http://www.dol.gov/ebsa/publications/AC_1114b01_report.html

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3 thoughts on “Week 12: Health Care Financing

  1. Ifi- Thank you for pointing out the declining trend in federally funded healthcare plans to used to manage current healthcare. Do you feel that the Affordable Care Act will promote the current trend in reduction of federal funding to oversee healthcare?

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  2. “Young Invincibles,” or healthy adults under 30 years of age, often don’t buy health insurance, because they don’ think they will need to use it (Coombs, 2013). However, one trip to the emergency room will average $1,233 if one does not have health insurance (Kliff, 2013). In addition, individuals who do not buy health insurance will have to pay a penalty every month they don’t have insurance, which will be $625 per adult in 2016 (Moeller, 2012). According to the Congressional Budget Office (CBO), about 4 million adults will pay the penalty each year (Moeller, 2012). If people do not pay the penalties, the IRB will withhold tax refunds (Moeller, 2012). Enrollment for health insurance at the MarketPlace begins every year on November 15 and ends January 15 of the following year (MiHealth, 2014). If people would rather pay the penalty, maybe they could look into becoming a member at NextCare Advantage. For $30 a month, they can have access to provider consultation, x-rays, basic lab tests, wound care, etc for $35 when they want to come in for a visit.

    References
    Coombs, B. (2013). Obamacare challenge: Getting young workers to buy insurance. Retrieved from http://www.cnbc.com/id/
    Kliff, S. (2013). An average ER visit costs more than an average month’s rent. Retrieved from http://www.washingtonpost.com/blogs/wonkblog/wp/2013/03/02/an-average-er-visit-costs-more-than-an-average-months-rent/
    MiHealth. (2014). Avoid increasing ACA penalties in 2015. Retrieved from http://mihealthanswers.com/avoid-increasing-aca-penalties-2015/
    Moeller, P. (2012). How the health insurance mandate penalty will work. Retrieved from http://money.usnews.com/money/blogs/the-best-life/2012/07/13/how-the-health-insurance-mandate-penalty-will-work

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  3. To clarify, a single adult will have to pay $625 as an annual fee in 2016 if they do not have health insurance. According to Moeller (2012), the penalty accrues for each month one is not covered by health insurance with a 3 month grace period before penalties start to add up to that annual $625. This is how I understood it. Hope that makes sense.

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