Impact of Business Operations and Policies on Healthcare Costs

Abstract

It is no surprise that the United States has a problem managing its healthcare costs. To get insurance to cover medical costs, people have to stay in-network, pay their premiums, yearly fees, meet their deductible–which is the maximum out-of-pocket cost–pay a copay–a fee for a physician visit or prescription refill–and finally pay their co-insurance: the percentage of a medical bill the customer has to pay. The United States has access to some of the best medicine in the world with state of the art MRIs, which much research and development happening in the United States, and “the U.S. has four times the number of MRIs per capita as Canada, and three times the number of cardiac surgeons” (Cutler, 2020). There are many reasons as to why healthcare costs are so high in this country, one major reason is inflated health administration costs. This paper examines what is the cause for high health administration costs, and aims to find policies that could be implemented to lower these costs.