Today more than ever we are being faced with the problem of our Health Care system. Currently the United States spends 1.6 trillion dollars on healthcare. That amounts to 15% of our GDP. To look at it in perspective that's almost double what the country spends on information technology. Within the decade, estimates claim health care costs could rise as high as 3 trillion dollars. According to the Labor Department's consumer expenditure survey, US residents in 2002 spent $2,350 on medical expenses, which is 4.8% of annual household income. There are many underlying reasons for these high costs. The problem then becomes what do we do about it, and how does it affect the future growth and development of the economy (Healthcare Financial Management). Some of the major reasons for rises in the healthcare system are an aging population, high administrative costs, overuse, technology, prescription drugs, uninsured, shifting of costs by the government, malpractice suits, lifestyle choices, and inflation. The "baby boomer" generation as we know it is getting older. In addition to that people's life expectancy rate is on the rise, which means the health care system has to cover people longer. As these people get older, they tend to require more medical care. In one study they found a 64-year-old individual requires nearly $4,500 more per year in health care services than an 18-year-old. Excessive costs come from administrative and paperwork costs. The reason these costs are so high is because of the third-party relationship. Most of the country is insured under private insurance companies. Third-party payers are trying to control costs by closely monitoring the behavior of doctors and patients. This is found to be excessive because these cost-containment activities have not contained costs very well at all. (Tillmar, 2003)
             The overuse of drugs and medical services is a big reason for the hike in health care prices. Si...