Question

Making budgeting decisions in health care is extremely important because a decision to spend money in one area may take away from another area. Address how would you go about balancing the demands of financial stability, growth, and profitable margins with the demand for the highest quality patient care.

Answer 1

The importance:

The critical importance of adequate Healthcare infrastructure was underlined by the outbreak of Covid19 pandemic which tested the preparedness of several countries including the world's most powerful economies. That emphasizes the need of looking towards the healthcare as far more than just an expense to the annual budget of a country.

The decision:

Ultimately it is about finding the right balance that will ensure smooth sailing for a nation in any adverse situation. The recent pandemic costed billions of dollars worth of lost business, several small businesses were permanently shut and several people lost their livelihood. An important thing to understand here is sustainability for the infrastructure expenditure. The funds at hand are the only resource to be invested in the right place to earn money, suffice the needs of the population and ensure well being of all. Investment in building financial stability of a country ensures booming domestic businesses, favourable economic policies promise foreign investments pouring in which ensures job creation and overall growth of the nation. Profitability of businesses including a margin with sustainable consistent growth will ensure long term stability. Expenditure on fields such as defence, education and science and technology ensures security, available local talent and advancement in new techologies. The healthcare expenditure on the other hand ensures proper set up for treatment of people at affordable costs. In any case, having an adequate healthcare system is advisable as it ensures that the other activities are carried out smoothly.

The right mix:

The healthcare expenditure must ensure that the quality of treatment is the highest that is possible. Another factor is how to make the best quality healthcare available at affordable price so that maximum people are covered under this. Making healthcare insurance compulsory for citizens would guarantee the payments for healthcare centers or hospitals. Increasing the healthcare budget in any particular year would in effect mean taking out some money from other avenues, however the oppurtunity cost of spending that money on healthcare should make good the oppurtunity cost. Healthcare infrastructure of countries like the USA which spends close to $3.8 trillion on roughly 18% of GDP on healthcare did a dismal performance in containing the spread of COVID19 cases. Thus, careful planning is required to gradually build a robust healthcare system to ensure safety during any such testing times.