Upward Trend in Health Care Costs in the US

Rising Costs of Health Care

Currently, health care spending in the U.S. displays an alarming trend of a steady increase. According to the recent estimates, by 2021 the total cost of care can reach $5 trillion, which would comprise one-fifth of the country’s gross domestic product (Nickitas, 2013). It has also been pointed out that the majority of issues associated with quality of care are related to the phenomenon in some way (Miller, 2011). The current paper lists the negative effects of increased spending on stakeholders outlines the benefits of addressing the problem and argues in favor of stakeholder involvement as a contribution to the cause.

The most apparent negative effect can be observed in the general population. Currently, healthcare-related expenses already comprise a significant proportion of average personal income. Once we assume the continuation of the trend, the challenge of paying for care delivery becomes increasingly difficult. The situation is further exacerbated by the fact that many patients do not have an accurate perception of incurred costs. According to the study by Dickson, Bulley, and Oliver (2014), up to 65% of the respondents underestimate the costs while only 5% can make correct estimates. On the other hand, healthcare providers report difficulties associated with inflexible payment models and, as a result, decreasing efficiency of care (Kaplan et al., 2014). Finally, in the long term, it is reasonable to expect a decline in public health on a national scale.

Thus, the reduction of healthcare spending should be considered a priority. The situation can be addressed through the introduction of payment reforms combined with approaches such as improved measures of healthcare quality (McClellan, 2011). The implementation of these changes would allow providers to enjoy the flexibility and transparency of the services they offer without being vulnerable to unreasonable limitations and increased financial risks. At the same time, their customers would gain access to a range of affordable healthcare plan options combined with the increased quality of care delivered. In other words, the reduction in spending is expected to benefit both stakeholder groups.

As can be seen from the information above, all major stakeholders, namely the healthcare providers and the patients, should be involved in the decision-making process related to the issue. Specifically the former should cooperate with policymakers and governments to assist the development and implementation of the reforms. At the same time, the latter should promote awareness through community organizations and demonstrate the capacity for conscious participation in the process.

Emerging Trends in Health Care

Healthcare is a rapidly developing and highly dynamic field. The majority of changes observed in the field are expected to make a positive impact on the industry in the long run. However, the pace of growth currently observed in the domain also creates the risk of inconsistencies and setbacks due to the lack of experience in the newly taken directions. The following paper analyzes the trend of the increasing significance of nursing and finance leaders, evaluates its implications for the delivery of care, and outlines its possible impact on care quality.

The main trends that affect healthcare today are the increasing role of informational technology in the delivery of care, the uncontrollable increase in spending, and the adoption of leadership practices at the organizational level. Leadership as a management-related activity is a relatively new concept in organizational development. Since its introduction in the business sector, it has eventually found its way into other domains, including healthcare. Currently, several positions exist that cover the leadership of certain areas of care, including clinical practice, financial performance, and nursing, among others. However, the growing popularity of the approach creates a situation where due to the lack of understanding the leaders are assigned inappropriately (Baker, Baker, & Dworkin, 2018).

According to Sanford (2011), the majority of employees working as nursing and clinical leaders reported being selected based on the criteria of their performance as nurses and clinicians, respectively. In other words, the factor of managerial competencies, experience, and knowledge was not taken into account and, in fact, non-existent in at least some cases. This downside to a seemingly favorable trend poses several implications for the delivery of care. From the perspective of doctors, it limits the flexibility and efficiency of their clinical activities due to the absence of effective leadership practices. At the same time, the current strategy is counterproductive from the human resource standpoint due to the focus on professional excellence (Zelman, McCue, & Glick, 2009). Simply put, a promotion to a leader also removes an excellent nurse or clinician from its position. From the patients’ perspective, such a situation is equally undesirable, as it reduces the availability of competent healthcare professionals and, by extension, compromises the outcomes and lowers patient satisfaction rate.

As can be seen, the trend of the increasing role of leaders in the healthcare delivery process on health care quality is two-pronged. On the one hand, it contains the potential for substantial improvement due to better coordination of actions, greater transparency of financial operations, and stronger involvement of nurses and clinicians, all of which are beneficial for the quality of care. On the other hand, the current lack of consistency in the approach means that at least in the short term, a minor detrimental effect can also be observed due to the lack of attention to managerial proficiency. Thus, it is necessary to revise the current approach to eliminate the existing inconsistencies while at the same time preserving the long-term benefits.


Baker, J. J., Baker, R. W., & Dworkin, N. R. (2018). Health care finance: Basic tools for nonfinancial managers (5th ed.). Burlington, MA: Jones and Bartlett Learning.

Dickson, J. K., Bulley, S., & Oliver, D. (2014). Efficiency and perceptions of cost in healthcare. British Journal of Healthcare Management, 20(5), 222-226.

Kaplan, R. S., Witkowski, M., Abbott, M., Guzman, A. B., Higgins, L. D., Meara, J. G.,… Wertheimer, S. (2014). Using time-driven activity-based costing to identify value improvement opportunities in healthcare. Journal of Healthcare Management, 59(6), 399-412.

McClellan, M. (2011). Reforming payments to healthcare providers: The key to slowing healthcare cost growth while improving quality? Journal of Economic Perspectives, 25(2), 69-92.

Miller, H. D. (2011). Transitioning to accountable care: Incremental payment reforms to support higher quality, more affordable healthcare. Web.

Nickitas, D. M. (2013). Health care spending: The cold, hard facts on cost, quality, and care. Nursing Economics, 31(1), 5-7.

Sanford, K. D. (2011). The case for nursing leadership development. Healthcare Financial Management, 65(3), 100-106.

Zelman, W., McCue, M., & Glick, N. (2009). Financial management of health care organizations: An introduction to fundamental tools, concepts, and applications (3rd ed.). Hoboken, NJ: Jossey-Bass.

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