The Purpose of Financing Healthcare Services – Health System Example

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"The Purpose of Financing Healthcare Services" is a great example of a paper on the health system. Over the years, there have been considerable changes in the way healthcare services are being financed. Widespread reforms have been made towards meeting the growing healthcare needs of the United States (US) people. However, certain imperative aspects such as constantly rising healthcare costs, and challenges of financing healthcare services have been apparent. Despite the continuous effort from the government to meet the healthcare needs of the US people, a large proportion of the American population is deprived of health insurance and is lacking adequate coverage.

As a consequence, the ability of the individuals to access timely preventive and quality care can be seen to be reduced to a considerable extent. Such a prevailing situation has created a greater need for the federal government to take more concrete initiatives to meet the rising demand for financing healthcare services in order to effectively address the current healthcare needs and secure a healthy future (Sultz & Young, 2010).   Action In the US, healthcare outlay is generally financed by both private and public sources.

The financing of the healthcare system in the US is swayed by various factors such as the provider of the healthcare services, employer, and consumer as well as political elements among others. The major challenge in relation to the US healthcare system is that currently 47 million people are deprived of insurance coverage while the other challenge includes the control of rapidly increasing healthcare costs. The recent economic recession experienced by the nation has left a significant impact on US healthcare expenditure. As a result of this recession, healthcare spending was slackened to 4.4% (Sultz & Young, 2010).

According to the recent study, financial challenges have been identified to remain the topmost concern amid the hospital CEOs’ (Chief Executive Officer) in the year 2013 (American College of Healthcare Executives, 2014). Nonetheless, the healthcare cost in the US accounts for nearly one-third of the total state budget which comprises a wide range of financing activities. State legislatures have articulated thousands of health policies in order to ensure improved access to healthcare services and support the endeavor directed towards seeking healthy people.

In order to reduce the gap between the rising healthcare cost and the access to quality care, the federal government in recent years has introduced the Affordable Care Act of 2010 (ACA) with the intention of bringing extensive modifications to the US healthcare system. The Act is perceived to have a significant influence on the overall healthcare system of the US. The implementation of the Act is accompanied by the creation of new health insurance legislation that is perceived to influence premium rates and coverage of the people among others.

State legislature during the years 2013 had considered over and above 2500 bills dealing with the Act since its implementation succeeded by 500 signed into law while there are still 1000 bills under consideration. The Act has also placed a few rigid rules for an individual which mandate penalties for those Americans failing to obtain insurance coverage. Nevertheless, a few prominent challenges such as attracting young and healthy people, improving consumer understanding about new rules as well as coverage opportunities accompanied by small penalties for non-engagement are perceived to create certain hurdles to enroll the US people in coverage.

In order to deal with these challenges, both the federal government and states are implementing collection strategies to seek an unprecedented level of enrolment and reduce barriers that have minimized the effectiveness of previous coverage efforts (National Conference of State Legislatures, 2014).


American College of Healthcare Executives. (2014). Top issues confronting hospitals: 2013. Retrieved from

National Conference of State Legislatures. (2014). Medicaid and marketplace outreach and enrollment options for states. Retrieved from

Sultz H. A., & Young, K. M. (2010). Health care USA (7th edition). United States: Jones & Bartlett Publishers.

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