Several efforts of the American government aimed at containing the rising cost of health care produced, inter alia, the side effect that consisted in the complication and sometimes limitation of access to health care in a convenient and timely manner. How can the quality health care be provided in the United States at lower costs and in a way that is widely and conveniently affordable to everyone?
According to Harrison (2013), in the first half of the twentieth century, charitable donations to hospitals “fell below the amounts needed to keep them in operation due in part to the stock market crash and the great depression that drastically depleted personal wealth in the United States” (Harrison, 2013). With reduced income from charitable donations, many hospitals had no choice but to charge fees for their services. This historical event gave birth to the new political quest aimed at finding a way to solve the health care financing problem.
Offering different solutions, this quest has influenced many federal, state and local policies pertaining to health care financing. For example, President Roosevelt has implemented his New Deal to provide material aid to retired Americans through Social Security, while President Johnson’s Great Society programs guaranteed healthcare to the retired and people with low income through Medicare and Medicaid. The next milestone was to provide the universal health care for all Americans.
The State of Oregon has become the first state to move towards the universal healthcare system with the Oregon Health Plan of 1989 (Harrison, 2013). In 1994, the first year of its operation, almost 120,000 people were enrolled in The Oregon Health Plan. The plan is still running, although the treatments covered by the plan and the enrollment are both limited by cuts of the state budged and rising costs of treatment. President Clinton also embraced health care reform as a key platform issue, but failed to implement the Clinton health plan of 1993 also dubbed “Hillary Care” by opponents. Clinton’s plan did not find support among the oppositional Republicans, who considered it an unnecessary governmental intrusion into the health care; at the same time the Democrats lacked unity to sustain the program. By 1994, the Congress abandoned the plan after coming to the conclusion that the program had no chance of passing even in a compromised form. The State of Massachusetts came up with the universal health care for its residents with the help of the Massachusetts Healthcare Reform Law of 2006, also known as Mass Health. Mass Health provided healthcare insurance to the majority of the residents. The long term financial efficiency of the program cannot be judged yet, since the program has only been in place for four years. However, according to Harrison (2013), as healthcare costs continued to rise, the program needs to be carefully monitored with its further development (Harrison, 2013).
Harrison (2013) mentioned in his book that on February 26, 2009, President Obama delivered his budget message to Congress, outlining “a set of eight principles for transforming and modernizing America’s health care system” (Harrison, 2013). President Obama has made effective use of Democratic majorities in both the Senate and the House of Representatives to promote his health care reform offering the Patient Protection and Affordable Care Act (PPACA) in 2010.
In 2010, the cost of the health care in the United States accounted for 17.7% of America’s GDP. In 2020, the estimated cost of the healthcare in the United States will amount to 21.3% of country’s GDP. As found by Teitelbaum and Wilensky, spending on the healthcare surpass the growth of the whole economy (Teitelbaum & Wilensky, 2009). Over the last 35 years the whole nation's spending on all goods and services has risen at an average annual rate of 7.2%, and the amount spent on healthcare has grown to the rate of 9.8%. Christensen et al. argued that as a consequence, the number of Americans that cannot afford adequate health care is still increasing (Christensen, et al., 2009).
The recommended health care reform will require the Action Coalition Framework and the Disruptive Innovation Model that were designed by Dr. Clayton Christensen of Harvard Business School. The model, as shown in Fig. 1, has three enablers: a simplifying technology, a business model innovation, and a disruptive value network. According to Christensen et al., the first enabler transforms technological problems from something that requires deep training, intuition, and iteration “in order to resolve it, into a problem that can be addressed in a predictable, rules-based way. Diagnostic abilities are the technological enablers of disruption in health care” (Christensen et al., 2009). The accurate problem definition is one of the most important parts of the development of an effective solution, regardless of the industry.
This policy statement offers a new approach for innovative strategies in order to reduce the cost and improve the quality and affordability of the healthcare. The essential objective is to study the healthcare business through the scope of general improvement models that emerged in the automobile, computer hardware and software industries, national defense, financial services and telecommunication, etc. In a nutshell, this model will employ the advocacy coalition framework in addition to the Disruptive Innovation Model to amend the reimbursement regulations. Applied by the skilled volunteers and healthcare providers, the technology will thus perform sophisticated procedures in a cost effective and safe manner.
Figure 1. Disruptive Innovation model
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