Affordable Care Act (ACA - popularly known as Obama care) is the center stone for government shutdown. US spends about $ 2.5 trillion (on the GDP list, it would rank fourth just behind Japan) on healthcare and the cost is rising faster than GDP growth. Even after this spending, the average life span of an American is lesser than one in Sweden, UK, or some of the European countries. In fact US is ranked one of the lowest among the OECD countries when it comes to life expectancy. It is hard to pick something and say this is the problem. US has the world's best healthcare with respect to technology (an average individual spends less time in the hospital in US than in any other country in the world). US has one of the best access to healthcare (Denmark, Sweden, and Finland edge over US). However when it comes to cost, US is a complete outlier. Whatever may be the reason, output of a healthcare system should be longevity in life expectancy and certainly it is not seen here.
More than 15% of the US population is uninsured (In Canada, pretty much everybody is insured for the coverage is offered by government) and even those who are insured are not insured for quite a few services that they have to manage out of pocket. So there is significant out of pocket spending that goes in to Healthcare (not as surmounting as in India where out of pocket spending to public spending is 2.3:1). In Canada, out of pocket expense is virtually zero. 40% of the healthcare spending in the US is contributed by hospitals and as a result, individuals feel comfortable staying away from any sort of care than to consider some care and go bankrupt. If this was not bad enough, ACA is one such black box about which even the creators have no much idea. I am not here to criticize Obama Care for not just me but much of US is unaware of what's in it. As per this act, all citizens should be insured by 1st of January 2014 and if they are not, a fine of $95 will be levied on them. In addition, the act requires all employers employing more than 50 full time employees to provide insurance to its staff. Already fast foods and retail, which are one of the largest employers in US, have started to push much of its workforce from full time to part time thus keeping the number below 50. Now neither these employees fall below the poverty line nor they have capacity to buy the insurance from the exchanges even though it is offered at subsidy. A recent poll indicated that majority of US citizens are not in favor of Obama Care. In fact some economists fear that this new act will force physicians to drive away those individuals covered under Obama care for they have to wait for the government to pay them the discounted fee for the care provided. So is Obama Care bad for US? Democrats feel that it is going to bring down the budget deficit drastically for one of the key reasons behind US budget deficit is healthcare. On the other hand, Republicans feel that this is going to be the last nail on whatever growth the economy is experiencing for it might result in job losses. Whoever may be right, the entire world that includes pharmaceutical companies, Payers, and Hospitals is watching how this drama is going to unfold and so am I.
I am not one who would favor government providing universal healthcare and so i am not advocating for Nordic countries or countries such as Canada. However if the government has taken the responsibility, we got to see the results. About 10% of world's GDP goes in to healthcare (I think second to Agriculture.. Not much sure about Defense). This has inspired me to pen this post.
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