Comparing Health Systems and Challenges in Costa Rica and the United States

By Sarah E. Rudasill
2015, Vol. 7 No. 02 | pg. 3/3 |

Implications for the United States

As a sign that it recognizes the unsustainable nature of its health care expenditures, the United States has begun undertaking similar but significantly smaller fiscal reforms than those in Costa Rica. Government efforts to reduce health care costs resulted in decreased reimbursements for doctors and hospitals through Medicare and Medicaid. In 2003, Medicaid reimbursement was set at 69% of Medicare reimbursement, and Medicare payments were still significantly less than private insurance reimbursements (Rice et al., 2013, 127). However, the reduced payments mean that only 60% of primary care physicians are accepting new Medicaid patients (Rice et al., 2013, 127).

The emerging primary care demand, stemming from a Medicaid expansion in half of the states and millions of people wielding health insurance for the first time, has yielded a shortage of primary care physicians that is especially exacerbated in rural regions. These geographic gaps in care mirror the lack of coverage for rural Costa Ricans, but financial limitations have prevented clinic expansion to areas with too few residents.

With greater demand for services comes the challenge of increasing quantity of care without reducing quality. The emergency department, one of the most expensive sources of health care, has observed a tremendous increase in quantity of patients and subsequently cost of care. As a result of both uninsured and underinsured patients, visits to the emergency department have grown from 353 to 390 visits per 1,000 people between 1997 and 2007 (Rice et al., 2013, 237).

Like in Costa Rica, the emergency departments serve as the safety net for citizens who lack adequate insurance but need immediate medical attention because all departments are legally required to provide enough care to stabilize patients. Although the Affordable Care Act was purported to reduce the use of the emergency room, evidence suggests that it has only increased use and consequently expenses (Rice et al., 2013, 237).

Unlike Costa Rica, the United States does not currently place any restriction on hospitals in the purchase of medical equipment or pharmaceuticals (Rice et al., 2013, 38). However, its newly formed ACOs are an experiment to determine whether broad caps on total expenditures are effective in limiting the ever-growing costs of medical care. Although most hospitals and medical personnel are not nationalized, mandating maximum spending levels for private institutions can result in the desired cost savings. Limiting expenditures, unnecessary surgeries, and expensive options for medications has proven useful to Costa Rica in reducing costs but may be politically untenable with an American population that has enjoyed unlimited health care choice for many decades.

Recognizing the unpopularity of rationing care, the federal government has forfeited control over slashing costs to the ACOs, which will determine the best method of reducing costs without massive reductions in care quality. The ACOs now have a unique opportunity to adopt some of the fiscal reforms that Costa Rica has undergone to maintain its system’s long-term survival. If these institutions implement the cost-effective strategies that Costa Rica has undertaken without coercion from the federal government, then perhaps the necessary fiscal reforms will be better received by the American public.

However, these cost-cutting measures come at a price measured as a decrease in not just dollars but also quality of health care services. It is naïve to assume that the United States can reduce its extravagant health care expenditures without any subsequent change in appointment wait times, drug availability, compensation for medical personnel, or reduction in rural medical facilities. Costa Rica is a prime example of a centralized system forced to undergo fiscal restraint for the sake of long-term . Although the United States possesses far more economic resources, it too cannot maintain growth in health care expenditures without repercussions.

Conclusion

Considering the recent changes that established federal subsidies for health insurance expansion, in addition to the existing costs of chronic disease, an aging population, and rising medical prices, the Congressional Budget Office predicts a future of consistently mounting health care costs for the United States. Although it may have the financial resources to delay payment now, the country will be forced to confront the unsustainable nature of its medical expenditures in the future. Drawing on the lessons offered by Costa Rica, which also faces a rise in chronic conditions, an aging population, and skyrocketing costs, the United States must implement cost-saving solutions to preserve its health care system for future generations.

The tactics utilized by Costa Rica – limitations on medications, reductions in funding available for technological upgrades, reductions in compensation for medical personnel, appointment limitations, and changes in the proportion of expenditures shouldered by the government – have still proven inadequate in sustaining the health care system for the long term. Furthermore, in both Costa Rica and the United States, private insurance will persist for those with the financial means to purchase more comprehensive care, undermining attempts to establish truly equitable health care systems. Despite its proclivity for debt financing, the United States too will confront the realization that growing health expenditures – particularly those by the public sector, which bears a disproportionate burden of the costs – must be halted.

Although financial problems have led Costa Rica to abandon its promise for universal health care access and significantly reduce the quality of care, the United States still has time to develop strategies to expand quantity of medical services and reduce expenditures without terrible reductions in current medical service standards. Although the challenge is formidable, preemptive attempts to cut costs through ACO experiments under the Affordable Care Act offer greater hope than waiting until a crisis to adopt fiscal reforms.

Ultimately, both Costa Rica and the United States must outlast their temporary demographic shifts and discover methods of reducing the chronic but preventable diseases that account for 75% of health care expenditures. Reducing costs before they are even incurred by improving population health demonstrates that prevention is the best medicine for both our bodies and the economy.


References

Boddiger, D. (2012). Costa Rica restructures health system to curb financial crisis. The Lancet, 379(9819), 883-883. Retrieved December 31, 2014, from http://www.ncbi.nlm.nih.gov/pubmed/22413141

Costa Rica: Health Profile. (2014, January 1). World Health Organization. Retrieved December 31, 2014, from http://www.who.int/countries/cri/en/

Del Rocío Sáenz, M., Acosta, M., Muiser, J., & Luis Bermúdez, J. (2011). Sistema de salud de Costa Rica. Salud Pública De México, 53(2), 156-167. Retrieved December 15, 2014, from http://www.scielosp.org/scielo.php?script=sci_arttext&pid=S0036-36342011000800011&lng=en&nrm=iso&tlng=en

Del Rocío Sáenz, M., Luis Bermúdez, J., and M. Acosta. (2010). Universal Coverage in a Middle Income Country: Costa Rica. World Health Report Background Paper, No. 11. Retrieved from http://www.who.int/healthsystems/topics/financing/healthreport/CostaRicaNo11.pdf.

Morgan, L. (1987). Health without wealth? Costa Rica's health system under economic crisis. Journal of Policy,8(1), 86-105.

Rice, T., Rosenau, P., Unruh, L., Barnes, A., Saltman, R., & Van Ginnekin, E. (2013). United States of America: Health System Review. Health Systems in Transition, 15(3), 1-445. Retrieved December 29, 2014, from http://www.euro.who.int/__data/assets/pdf_file/0019/215155/HiT-United-States-of-America.pdf

United States of America: Health Profile. (2014, January 1). World Health Organization. Retrieved December 31, 2014, from http://www.who.int/countries/usa/en/

Suggested Reading from Inquiries Journal

As the nation’s largest health insurance program, Medicaid plays a huge role in the current health care reform debate. The program serves over 50 million people and has total outlays equaling over $280 billion[i]. Medicaid is much more than simply a program for the poor. It may also serve those who qualify for Supplemental... MORE»
Advertisement
During the 2008 Presidential Election, voters designated health insurance reform as a key issue for their future president to work on. With 46.3 million Americans uninsured in 2008, voters demanded change, and upon his election... MORE»
The Patient Protection and Affordable Care Act of 2010 called upon states to expand Medicaid, a subsidized health insurance program, for individuals making up to effectively 138 percent of the federal poverty line. The rapidly... MORE»
This comparative analysis of U.S. and U.K. healthcare systems pinpoints inequalities in health outcomes and recommends policies to alleviate disparities. Mortality data from the CDC'S WONDER Database and Cancer Research... MORE»
Submit to Inquiries Journal, Get a Decision in 10-Days

Inquiries Journal provides undergraduate and graduate students around the world a platform for the wide dissemination of academic work over a range of core disciplines.

Representing the work of students from hundreds of institutions around the globe, Inquiries Journal's large database of academic articles is completely free. Learn more | Blog | Submit

Follow SP

Latest in Health Science

2018, Vol. 10 No. 10
Medical Debt has largely been viewed as a financial burden. While studies have linked Medical Debt to decreased savings, reduced health access, foreclosure of homes, and loss of income, there has been little to no research exploring Medical Debt... Read Article »
2018, Vol. 10 No. 01
Autism spectrum disorder (ASD) is a neurodevelopmental disorder with a wide range of severity, encompassing mild to severe levels of social, communicative, cognitive, and behavioral functioning. This social functioning disorder affects every 1 in... Read Article »
2017, Vol. 13 No. 1
Published by Discussions
Causal inference methods were performed on The Cancer Genome Atlas (TCGA) clinical datasets. First, relevant patient data were collected and merged. Then, an algorithm was used to create a causal directed acyclic graph (DAG). Next, the Iterative... Read Article »
2012, Vol. 1 No. 1
Published by Clocks and Clouds
This paper examines explanations for the current HIV/AIDS epidemic in the Deep South United States. The first set of explanations is categorized as social determinants of health and includes social and economic factors that influence public health... Read Article »
2017, Vol. 9 No. 03
This article argues that performance enhancing drugs (PEDs) ought to be allowed across all elite sporting competitions for athletes over the age of 16 so long as consuming them does not pose a significant risk to their health. I begin with a brief... Read Article »
2015, Vol. 6 No. 1
Published by Clocks and Clouds
Acquired Immune Deficiency Syndrome (AIDS) has ravaged sub-Saharan Africa in the decades since its first recorded case. The disease has reached epidemic levels in many regions, with millions of new cases diagnosed each year. This paper examines... Read Article »
2016, Vol. 6 No. 1
A study in May 2014 analyzed food labels in Quito, Ecuador, to better understand the culture's nutritional communication. The study explored what is considered to be a healthy diet in Ecuadorian culture and how this is communicated, and also to... Read Article »

What are you looking for?

FROM OUR BLOG

How to Read for Grad School
What is the Secret to Success?
How to Manage a Group Project (Video)