The Health Care Industry and Its Need for Reform

I. Introduction
The health care industry has recently witnessed some of its roughest years in recent history with regards to financing, including long term debt financing and working capital financing. Then, just as the capital markets began to mend, the most comprehensive health care bill was passed since the creation of Medicare was enacted in 1965.
On March 23, 2010, President Obama singed the most comprehensive health care system reform law since the creation of the Medicare program. This new health care reform known as The Patient Protection and Affordable Care Act (ACA), and subsequent related legislation, expands Medicare and Medicaid coverage, and attempts to control health care costs and improve health care delivery systems. Nonetheless, it also inflicts significant requirements on health care delivery systems that will increase costs, such as; decreasing some traditional sources of funds available to health care delivery systems; and increasing the pool of government funded patients. These changes create financial strains and uncertainties that could unfavorably impact the financing available to the health care industry at a period it cannot afford.
II. Health Care Reform
A. Reasons for Health care Reform
Health care reform is needed for the following reasons:
• Firstly, health care charges are skyrocketing. In 2011, the average cost for a family of four increased 7.3%, to $19,393. That's almost twice the cost just nine years ago. By 2030, payroll levies will only cover 38% of Medicare costs. The rest will assist to the government allowance deficit.
• Secondly, health care reform is required to improve the value of our health care, which is currently the lowest in the evolved world. Chronic diseases cause 70% of all U....

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...or behavioral healthcare organizations that are understanding enough to embrace clinical decisions to support technologies such as those mentioned above. In the approaching era of affordable healthcare, those who can clearly demonstrate factual worth in their product will be rare and in high demand. Given what we understand about the occurrence of behavioral health conditions and their influence on overall healthcare spending, healthcare providers have the exact expertise needed to illustrate significant value in a system that rewards performance. Regrettably, such improvements in value (i.e., outcomes divided by cost) are not incentivized in the common fee for service payment models, which encourage quantity, not value. Altering this is one of the core concepts of healthcare reform and affordable care – to move from incentivizing volume to paying for performance.