Bernstein (2009) observes that the US economy shapes the interrelationships among employment, health coverage and costs, and financial access to care and health outcomes. As such, the effects of economic stress and surges on a healthcare system can be manifested directly or indirectly through accessibility or outcomes of the healthcare system. Present days the US economy has experienced three official recession periods according to data from the National Bureau of Economic Research. The third recession, experienced as from December 2007, is likely to last long and deep into the future, thereby affecting consumer purchase patterns, inclusive of health care.
The effect of the economic recession on employment has been alarming. Following the onset of the recession, numerous employees lost their jobs. Mass layoffs were seen in virtually all industries, with unemployment rates significantly high. Bernstein (2009 p. 1) reports that data from the Bureau of Labour Statistics’ Current Population Survey showed that unemployment rates in the US had reached 9.5% in 2009, down from 4.6% in 2007. Such a trend is worrisome, bearing in mind that the unemployed cannot access health insurance. The US healthcare is structured in a way that access to health is made possible through insurance coverage (Bernstein, 2009). This implies that unemployment is expected to rise, resulting in fewer insurance covers and low accessibility to healthcare in the future.
Aside from the loss of insurance cover, unemployment has negative health impacts on the unemployed. Stress is a major outcome of unemployment. The effect could be several folds higher if the person were the breadwinner in the family. The psychosocial aspects of unemployment can be a source of other medical conditions such as depression, cardiovascular diseases, and stress-related ulcers, among other conditions. Furthermore, following the loss of employment, the affected person can engage in social vices such as organized crime, robbery or prostitution. According to these habits negatively affect the health outcomes of such people. As a result, unemployment is a source of adverse health conditions.
The contraction of the economy drives companies to minimize operation costs in a bid to remain competitive and avoid bankruptcy or business closure. Part of cost-cutting involves contracting employee health cover. Companies consider offering their employees with insurance cover an additional operation cost, which they cannot shoulder during the recession period. As a result, employers opt to shift premium costs to employees, share the cost of the premiums with employees or restrict new employees from accessing insurance cover (Bernstein, 2009 p. 2). Therefore, the previous coverage enjoyed by individuals and their families is likely to be lost.
The economic shifts affect changes in demand for or access to health care, as well as organizations’ and practitioners’ financial status (Bernstein, 2009 p. 4). Reports in the US indicate that there is a fall in demand for non-urgent or elective care, as well as defaulted medical bills. Such a habit is a consequence of the reduction in disposable income, in which patients practice opportunity cost. They are aware that their limited cash is incapable of servicing all of their needs; hence, they exercise the use of choice. Because of the deferment of health care by the public, practitioner reimbursement is also reduced, leading to low income returns. As a result, accessibility to better health has become a big problem.
The economic recession also impacts on government activities. Firstly, the government will see a fall in tax revenues due to the recession. Government spending is also increased in terms of offering welfare payments and income support to the unemployed. Consequently, government spending on health becomes compromised, making it unable to meet its health obligations to the public. Currently, the Medicare aid by the US government is inadequate to meet the healthcare challenges of its population. Bernstein (2009) reports about accumulating medical bills in hospitals due to cuts in health care funding by states and localities. As a result, the US is ranked 38th among developed nations regarding its healthcare system.