Potential Consequences of Reducing Healthcare Spending Discussion

Current Healthcare Spending

Healthcare spending is affecting the overall economy. Revenue for healthcare in the United States is a mix between various governmental sources, like Medicare and Medicaid and private sources. (Baker, Baker, & Dworkin, 2018). Compared to other industrialized nations, the United States spends twice as much on healthcare and healthcare spending accounted for 18% of the Gross Domestic Product three years ago. (Commins, 2018). Federal spending on healthcare programs is expected to be the largest spending category unless current laws change; due to the aging population as well as the rising cost of health care per person. (Banthin, 2017).

Potential Consequences of Reducing Healthcare Spending

Reduction in health care spending can have multiple consequences. If the Federal government spends less on Medicare and Medicaid services, then it could potentially finance other programs and also reduce the national debt. (Cohn, 2014). The reduction in spending could also benefit individuals and their families by allowing them to see more money in their paychecks and spend money on other necessities. (Cohn, 2014). The current state of health care spending will consume the largest share of the budget and increase debt overall. Therefore, finding ways to reduce health care spending should be priority.

Who Should Make Health Care Spending Decisions

Businesses, consumers, the Federal Government, insurance companies, policy makers and healthcare organizations are just some of the stake holders that should be involved in health care decisions. Health care spending affects different stake holders in different ways, therefore all should be involved in the decisions making in order to reach a decision and benefits all involved, especially patients.


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

Banthin, J. (2017). Health care spending today and in the future impacts on federal deficits and debt. Retrieved from https://www.cbo.gov/system/files/115th-congress-20…

Cohn, J. (2014). The paradox of reducing health care spending. The Milbank Quarterly, 92(4), 656-658. http://dx.doi.org/10.1111/1468-0009.12087

Commins, J. (2018). Healthcare spending at 20% of GDP? That’s an economy-wide problem. Health Leaders. Retrieved from https://www.healthleadersmedia.com/finance/healthc…

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