USA healthcare sector is in many ways the most substantial part of the United States economy. It is a fundamental part of people’s lives, supporting their health and well-being. Moreover, it matters because of its economic size and budgetary implications. The healthcare sector now employs 11 percent of American workers (Bureau of Labor Statistics [BLS] 1980–2019b and authors’ calculations) and accounts for 24 percent of government spending (Centers for Medicare & Medicaid Services [CMS] 1987–2018; Bureau of Economic Analysis 1987–2018; authors’ calculations). Health insurance is the most significant component (26 percent) of nonwage compensation (BLS 2019b), and health care is one of the largest categories of consumer spending (8.1 percent of consumer expenditures; BLS 2019a). The United States has a healthcare system that primarily consists of private providers and private insurance, but as health care has become a larger part of the economy, a higher share of healthcare funding. As of 2018, 34 percent of Americans received their health care via government insurance or direct public provision
A simple comparison of the percentage change in the healthcare industry’s GDP versus the manufacturing industry shows a direct correlation between the growth of one and the shrinkage of the other, percentage point for a percentage point. No other industry sector, except the manufacturing industry, has seen such a decline during this time. The U.S. is the only industrial country where the employer directly pays a substantial share of employees’ health care benefits. In other nations, citizens themselves and businesses foot the bill through income taxes.
U.S. payment of health care costs by employers causes the loss of U.S. manufacturing companies and manufacturing jobs. Health care costs, both primary and secondary, are passed during each step to the next contributor in the manufacturing process; think of it as value-added tax, moving the health care benefit costs to the next purchaser of services or goods. But each time the cost is passed on to another manufacturer in the supply chain, there is an additional markup for profit; therefore, the $3.6 trillion for healthcare is included in manufacturing costs. No other industry has as many links in the supply chain for cost markups or has international competition.
A manufactured good is made through several steps to get to the finished product, with each step adding the subsequent employee healthcare benefits cost to the finished product. These costs are referred to as indirect healthcare costs.
The United States economy is in a downward spiral. Our national debt is now above 28 trillion dollars, with the national debt at 108% of Gross Domestic Product. In January, we had the most significant trade deficit ever recorded for a single month at 68.2 billion dollars. Our manufacturing industry is now at its lowest level ever recorded in modern times. The cause is we do not have a supportive financial system for manufacturing.
The linked document will explain the cause of the decline of the U.S. manufacturing industry. The principal reason for the slide is the high-cost healthcare industry. It will review several unlawful practices of the healthcare providers and insurance companies and how the law enforcement agencies failed to protect us. The article gives details about the last four decades of the health care industry’s growth and then the effect of COVID 19. The article touches upon U.S. Debt to GDP ratio and its impact on future infrastructure investments in our country.
The article is precise and understandable, written for non-legal, non-financial, and non-accountants. The article discusses the two different required accounting methods, the very lax IRS audit procedures of the government business accounting and the private business accounting, the unrecognized kickback payments, the differences between cash and accrual accounting, the tax code requirements of GAAP, the unlawful contracts calling for price discrimination, and other tax problems.
Overall an interesting read and eye-opener with factual data point to support arguments. Then it establishes a conclusion about how to stop the decline and build a supportive financial to rebuild the manufacturing industry in the U.S.
The present financial system makes the employers pay for social and healthcare benefits before they sell their services or products. The new system allows them to sell their services and goods, make a profit and then take a small amount to cover the costs of social and healthcare benefits.
Click here to read more – https://why-the-us-manufacturing-industry.blogspot.com/2021/04/why-the-u-s-manufacturing-industry-has-shrunk-to-its-lowest-percentage-revenue-level-of-gdp-and-how-to-create-a-supportive-financial-environment.html
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