The health care system is one of the greatest expense of the U.S. It has steadily increase over the years since 1965. Many policies such as the Obama care and health insurance have been implemented to help ease the cost. However, this new policy and health insurance are expensive and provide inadequate coverage. This expense has caused a negative effect on the market.
In 2010, U.S. total health cost amounted to 72 percent of the 3.6 trillion dollars budget. That is about 10% more than what other countries like Europe spend on healthcare.
There are numerous explanations on why the health care system have risen so much, such as the demographics of the U.S, population is getting older, new technologies, third party financing, price, quantity
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Which in some ways healthcare insurance are not affordable, not even for employers and policy holders. This goes back on why employers and most small business do not hire fulltime employees because of the regulation of health care.
Obama health care plan, is a new program that was implemented and it has been found unsuccessful. Obama care requires that everyone has to have health insurance, if this policy is not followed people can get penalized. This reform provides few benefits and most of the population cannot afford it. “This it does not directly provide any healthcare insurance, and is no more than an administrative health reform providing few benefits with a large cost of $900 billion”.
Implementation of the new health care program impacted the U.S economy. It affects labor market, higher wages paid as service get demand increase, employers will reduce the quantity of labor. The U.S employment will be lower than in other wise it could have been. A firm employs labor to the point at which marginal revenue product of labor, marginal revenue times the marginal physical product equals wage rate. Increase in labor cost, consumers will pay higher prices for goods and