Ever since the certificate of need law was introduced in the United States, their effectiveness has been scrutinised or criticized. The certificate of need has been criticized for creating barriers in the health care market by shielding existing health providers from new entrants using the process. The main debate surrounding the certificate of need is with regards to the effectiveness of this program when it comes to quality of care, access and cost of healthcare, precisely on whether the certificate of need has had any negative or positive effects when it comes to fulfilling its purpose of lowering costs, improving health care quality and access even to the uninsured population. Moreover, the debate extends to its effect on competition issues, …show more content…
The idea behind certificate of need laws was to increase the provision of health care to low income earners whilst cutting health care costs. This was to be possible under the cross-subsidizing theory where health providers charge higher prices than they would normally do to cover losses when they provide care to the poor. This means that the health of the poor is subsidized by those who can afford to pay for health care. States who are using the program still believe that it is living up to its main mandate of lowering health care costs and increasing health care services to all. However, the idea was good on paper and not for implementation where competition laws are concerned because the program restricts market entry by limiting the number of players in the market. New entrants have to show in their applications that they are not providing a duplicate service and further show that the costs thereof will be …show more content…
The reasoning being that the lack of competition leads to existing health providers to have market power because of lack of competition. The restriction of entry and exit in the health sector gives firms monopolistic power to have control of the sector, be it on costs or access. Although studies have been conducted by many groups, the question still remains as to whether costs are lowered or increased. A study on the certificate of need by the Lewin Group on cost containment evidence proved to be weak that CON processes do affect spending patterns in a state. The group found no evidence that supports that safety - net hospitals are financially stronger in the CON states than those that are outside states without CON
Dawson, D. (1995) ‘Regulating Competition in the NHS.’ The Centre for Health Economics (University of York.)
health care, only those who are “privileged” enough to afford health care can receive it. So is this what health care in the United States is and should be?Arnold Schwarzenegger the former Governor of California stated “Health care is not a right, but its cause is a government interference in the healthcare system. The solution is to leave doctors, patients and insurance companies free to deal with each other on whatever terms they choose, not to socialize American medicine” (Russo). Schwarzenegger then went on about how this would cost the government too much money and that this is not the answer to the healthcare improvement (Russo). Sen. Shelia Keuhl, the senator that wrote the bill stated in a press release “It’s important to understand that vetoes of health reform legislation have very serious consequences […] Because of these vetoes, there will continue to be very little regulation of the runaway health insurance market and no protections for consumers”
The intent is to create a healthcare system where health insurance coverage is available to everyone. Coverage is through a joint effort of the government, employers, and individuals. A disparity in coverage often occurs within vulnerable populations. This includes children, unemployed and retired individuals, along with their families. They are more likely to have limited access to healthcare while having an increased need for medical services.
The commonwealth of Massachusetts’ compulsory health care system does make health care mandatory for all its inhabitants, but it cannot provide prima...
Davidson, Stephen M. Still Broken: Understanding the U.S. Health Care System. Stanford, CA: Stanford Business, 2010. Print.
Despite the established health care facilities in the United States, most citizens do not have access to proper medical care. We must appreciate from the very onset that a healthy and strong nation must have a proper health care system. Such a health system should be available and affordable to all. The cost of health services is high. In fact, the ...
A health care system that provides free health care services to its entire citizen can be termed as universal health care. This is a situation where all citizens are protected from financial costs in health care. It is recognized around the globe as it provides a specific package of benefits to all citizens in the entire nation. For instance, free health care can result to improved health outcomes. In addition, it provides financial risk protection and an improved access to health services. There is an increasing debate on how citizen should be provided with free medical services. Although United State does not permit free health care services it should have free health care for all citizens. This is due to the fact that healthcare is the largest industry in United State. Due to the fact that United State is a rich country, it should have a healthcare system that provides free services such as treatment for its entire citizen. This will play a significant role, as it will stop medical bankruptcies in...
In America the affordability and equality of access to healthcare is a crucial topic of debate when it comes to one's understanding of healthcare reform. The ability for a sick individual to attain proper treatment for their ailments has reached the upper echelons of government. Public outcry for a change in the handling of health insurance laws has aided in the establishment of the Affordable Healthcare Law (AHCL) to ensure the people of America will be able to get the medical attention they deserve as well as making that attention more affordable, as the name states. Since its creation, the AHCL has undergone scrutiny towards its effects on the government and its people; nevertheless, the new law must not be dismantled due to its function as a cornerstone of equal-opportunity healthcare, and if such a removal is allowed, there will be possibly detrimental effects on taxes, the economy, and poor people.
For making a comprehensive healthcare reform to work it is necessary to spread the cost of those with high medical needs which can be easily done by mandating the health insurance. A good example of this can be understood by individual mandate done in Massachusetts where it has been very effective and only 2.6 5 of the population is left uninsured.
Our healthcare system has developed into a burden for most people and has terrible consequences for others. It consists of everyone paying for healthcare as a whole, instead of people paying for themselves. This system of healthcare has burdened the people who take care of themselves and have money, but extends the life of people who do not take care of themselves and live in poverty. This is not pleasant for the one’s who decided to go to school and make well over minimum wage. In turn, they are the individuals who end up paying for the people who decided to make bad decisions in their life that put them in the minimum wage position. Clearly, laws regulate the insurance companies but these regulations do not make any sense to many. Balko explains that, “More and m...
The state is responsible for the overall regulatory, supervisory and fiscal functions as well as for quality monitoring and planning of the distribution of medical specialties at the hospital level (Schäfer et al., 2010). The 5 regions are responsible for hospitals and for self-employed health care professionals, whereas the municipalities are responsible for disease prevention and health promotion rel...
The American Healthcare system is a very complicated system. It is very difficult for an average individual to comprehend it. In order to understand the healthcare system you must also understand the iron triangle of health. The iron triangle of health is a concept or theory that was proposed by William Kissick in 1994. The three vertices of the iron triangle of health are cost, quality and access. According to this theory those three vertices are connected to each other, therefore, an increase in quality will either result in an increase in cost or a reduction in access. Also, if access is increased that will result in a decrease in quality and an increase in cost. Therefore, one of the most important purposes of creating the affordable Care
The intent of certificate of need regulation is to control healthcare costs by limiting the building of unnecessary health services and facilities based on geographic, demographic, and economic considerations. Proponents of these laws believe that unregulated market competition creates incentives for producers to overinvest in equipment and facilities leading overutilization of equipment and over hospitalization of patients in order to cover the increased capital input costs. Medicare and Medicaid make such a large portion in the healthcare marketplace and the pricing of both of these healthcare programs rely on the costs of production in order to compensate physicians and healthcare organizations. Because of how these programs pay for services, regulators believe there is an incentive for providers too build or expand facilities, or acquire more healthcare
The United States health care system is one of the most expensive systems in the world yet it is known as being unorganized and chaotic in comparison to other countries (Barton, 2010). This factor is attributed to numerous characteristics that define what the U.S. system is comprised of. Two of the major indications are imperfect market conditions and the demand for new technology (Barton, 2010). The health care system has been described as a free market in
According to Roy, 2013 the issues of providing the affordable care act will unite both the supporters and offenders of the public policy, but in this current situation where the input costs are rising, it will become impossible for government in managing the public policy related to affordable health care. In order to provide affordable health care, majority of the US government has tried out different policies time to time, but unable to get success in realizing the actual policy goals. By providing the affordable health care to majority of the people who requires more amount as controlling the input cost is not possible (AAMC, 2013). Lack of doctors is one of the primary issue in providing high quality health care to the citizens especially those who are financially poor. The Supreme Court of the country passed an Act related to Health insurance as all should have Health Insurance to all the country people by the year 2014, but the at the same time government is concerned about constitutionality of these act (NYTimes, 2013).