Health Care:

Problems and Potential Lessons for Reform

T-HRD-92-23: Published: Mar 27, 1992. Publicly Released: Mar 27, 1992.

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GAO discussed the U.S. health care system's problems and potential for reform. GAO noted that: (1) there is a growing consensus that the health care system needs change, particularly to address rapidly growing health care costs and access to care problems; (2) between 1980 and 1990, health care costs rose from 9.1 to 12.2 percent of the gross national product, and is projected to increase to over 16 percent by 2000; (3) the federal budget and American households experienced a 30-percent increase in health care spending during the last decade; (4) nearly 34 million people in the United States lack health insurance, and millions more are under-insured; (5) uncertainties about guaranteed availability and coverage continuity are eroding the traditional reliance on employment-based health insurance coverage; and (6) increasing competition among insurers for low-risk clients has limited the availability of affordable insurance for higher-risk populations. GAO also noted that: (1) common elements among successful domestic and foreign systems include universal coverage, a uniform provider-payment system, and expenditure targets and caps; and (2) the Rochester, New York, community appears to have successfully controlled rapid cost growth and access to care problems through health planning, a community ethic of cooperation among health care providers, and use of community rating rather than self-insurance and experience rating.

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