Investment Potential in the Healthcare

Week 5 Case Study: Investment Potential in Healthcare

August 10, 2013

HSM 544 Health Policy and Economics

Information for the presentation by Howard Hughes on the subject of the current status of the health sector and opportunities for investment. The role of the government in healthcare has always been a debate. American citizens are split on the role the government should play, some feel that they should be more involved and others are opposed to government involvement. Healthcare is an industry that has regulations in state and federal law and in payment terms. There is approximately 46% of the national health care expenditures for healthcare attributed to Medicare and Medicaid and 49% of the healthcare costs is paid by the private health insurance provider and the remaining 5% is not paid due to no insurance coverage or poverty (Morrisey, 2008). Government involvement is usually centered on cost of healthcare, quality and access to care. President Obama in March 2010 enacted the Affordable Care Act (ACA) which will ensure that all Americans will be able to obtain health care insurance (Department of Health and Human Services, n.d.). The ACA will require businesses to offer health insurance to their employees and for individuals to purchase health insurance at affordable rates (Department of Health and Human Services, n.d.). The role of government will be changing due to these new regulations of the ACA. American citizens are aging and becoming poor due to our economy and longer lifespan and these reasons contribute to why we need changes in our healthcare delivery system. With this being said, Americans will begin needing more healthcare services and will need to have increased government support to enable the access to quality care.

Because the United States health industry is not a public industry it links unemployment to loss of health insurance coverage and because people with poor health are more likely to have lower incomes due to their health issues this is leading to the need to expand eligibility for public insurance (Swartz, 2009). Because of the need for public insurance this will pressure Congress to increase government programs. These public insurance government programs are needed to form some kind of cost control and some type of healthcare that will be of use to the poor and older Americans (Swartz, 2009). With the developing cost control programs and access to care this will lead to healthcare changes that will lower the amount of profits but will increase the demand for certain sectors health care needs which will lead to better investment opportunities (Swartz, 2009). Because there are more aging Americans and longer life