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Why the U.S. Spends So Much More Than Other Nations on Health Care
- neilwilson 9y agoIt spends so much more on healthcare because of its obsession with possessive individualism and the ridiculous notion that a government of the people is out to get them. It'll change one the USA resembles India and China leads the world.
- rhaps0dy 9y ago"It'll change one" -> "it'll change once" It took me 15+ seconds to make this correction and parse the last sentence, here's it so that you don't have to spend them.
- annon2323 9y agoThis and expensive education as well. Nust take a look at Germany or France you will see free gratis high quality college education. Oh well...
- newprint 9y agoAs someone who worked for CareFirst, I had a privilege to accidentally overhear the panel of doctors who work for C.F. deciding if C.F. will cover procedure for the patient....fuck those guys. Next to the building, there was a helicopter landing platform for CEO. US insurance system anti-humane.
- vkou 9y agoWhen Obamacare was being drafted, house Republicans were busy condemning the 'death panels' of single-payer systems.
- jstewartmobile 9y agoDo you expect them to fly commercial, like animals?
- prostoalex 9y agoHow much of that egregiousness has been fixed by ACA’s cap on insurance company’s profits, in your opinion?
- ggg9990 9y agoWouldn't a profit cap encourage profligate spending on things like corporate helicopters?
- te_chris 9y agoOnly if that's deductible.
- jacobush 9y agoI assume you mean in a sarcastic way. If not: Of course it is. That’s what our man in congress is for.
- ceejayoz 9y agoNo. The ACA's profit cap (the "80/20 rule") requires that at least 80% of premiums taken in must be spent on actual medical care costs.
- rbehrends 9y agoThe ACA requires the somewhat perversely called Medical Loss Ratio (MLR) to be at least 80% (and 85% for large group plans). The MLR is the percentage of revenues from insurance premiums that are being used on actual healthcare benefits (and thus can't go towards profits, hence the name). Corporate helicopters don't increase the MLR and reduce profits.
- Zak 9y agoThis is a perverse incentive. If I'm running an insurance company and my goal is to maximize absolute profit, how do I do that when my profit margin is capped by law in this manner? Well, I certainly don't have an incentive to reduce healthcare costs; quite the opposite. 20% of a larger cost leaves me with more profit, and most of my customers won't drop my service. It's required by law and subsidized in a lot of cases.
- laci27 9y agoIt doesn't spend it on 'other nations'.. it spends the money on US billionaires. 'Other Nations' is just a facade, as it's much easier to loose track of a few billions here and there in a god forsaken country, than it is in the middle of NY. The military industrial complex costs a lost, but a BIG chunk of that money goes to US billionaires. The US population (aka military people) only get their wages paid, everything else is paid directly to Y and Z billionaire's tank/gun/warship/plane/drone/software/encrypted computer/add stuff to this list manufacturer. And these manufacturers buy a lot of politicians' vote to keep the war machine going. ..the same with pharma...
- ptaipale 9y agoLooks like you had so much to say about billionaires that you didn't have time to read the headline. It doesn't say anything about spending on other nations. The U.S. spends more on health care of its own citizens than other nations do. The system is clearly not very efficient, at least in terms of what it offers to poorer citizens, although at the top end, results are excellent and the U.S. still is in the front lines in research and technological progress of medicine.
- xzel 9y agoDepends on what you take the word efficient to mean, even at the top end I don't find medical care very efficient. Basic procedures can be very expensive for my insurance company. I'll define efficient here as results to cost. In the US, there are groups at every level between patient, doctor, insurance and big pharma where often their goal is to create inefficiencies because the less efficient the treatment, the more money make. Look at something like insurance billing codes; I have a friend who's entire business is telling Dr's which codes to book procedures under so they make more money from insurance. His company is make 10s of million a year. There is stuff like that at every level.
- ajdlinux 9y agoGP didn't say the top end was efficient, just that their results were excellent.
- nukeop 9y agoThis is a classic american problem - keep throwing money at something until it works. This conundrum plagues their healthcare, their education, their military, their welfare spending and so on. For example, they spend more on their military than the next 15 highest spending countries combined, and don't get proportionally better results. They spend a lot more on education (per student) than most European countries, but suffer from worse education quality than some developing nations. There is a fundamental problem with how this money gets spent, instead of how much of it is available.
- peterburkimsher 9y agoIt's a pity that they don't try throwing money at poverty. Maybe that problem will actually go away with more money being thrown at it. https://news.ycombinator.com/item?id=16040903 https://news.ycombinator.com/item?id=16040903
- imtringued 9y agoI think the primary problem with poverty is that the means to get out of poverty like education, healthcare and housing have exploded in cost.
- pas 9y agoSupply. Demand. Tuition costs skyrocketed because demand* skyrocketed. (Student debt) Healthcare costs went haywire because demand* is insanely huge. * - demand meaning the actual micro-economical concept, that is the curve/graph/function/relation describing the "preferences" of the customers. And since there is a lot of money in the system, the demand is big. A lot of people can and are willing (and of course forced) to spend a lot on health care. (And similarly on education. Since you want the a better future, at all costs, right? Right.)
- pishpash 9y agoAmerica is a net importer of capital. Money is cheap. The world pays America to be wasteful and spend. All of these problems will be "solved" when that reverses.
- narrator 9y agoSome guy was telling me how IBM Watson was going to make healthcare more efficient by helping doctors make smart choices. I replied that that wasn't going to help profits, so it probably wouldn't be adopted. Hospitals and insurers really should be merged so the incentives are all properly aligned. Kaiser Permanente works this way and, IMHO, it's actually not that bad.
- hkmurakami 9y agoI always wonder why kp hasn't expanded more.
- DrScump 9y agoThey've been doing a huge amount of infill in Northern California, replacing whole facilities with brand-new complexes in existing core patient areas. (One example is their Santa Clara facility, which replaced a predecessor less than a mile away with one maybe 5 times its size.) It must be an insane amount of capital expenditure.
- hkmurakami 9y agojust passed by the SC facility (the one on Homestead?) and it did indeed look massive. Great to hear that they are expanding in their core practice and geographies. Hope they continue to do well.
- DrScump 9y agoThat new residential neighborhood on Kiely Boulevard across the street from Central Park is where the prior Kaiser medical center was, going back to at least the 1960s.
- nl 9y agoYou way underestimate IBM sales staff. The real problem is that Watson doesn't work, and health care providers spent millions on it which could have gone to real, actual research. https://www.forbes.com/sites/matthewherper/2017/02/19/md-anderson-benches-ibm-watson-in-setback-for-artificial-intelligence-in-medicine/#55d873273774 https://www.forbes.com/sites/matthewherper/2017/02/19/md-and... https://www.forbes.com/sites/jasonbloomberg/2017/07/02/is-ibm-watson-a-joke/#51d87341da20 https://www.forbes.com/sites/jasonbloomberg/2017/07/02/is-ib... https://www.healthnewsreview.org/2017/02/md-anderson-cancer-centers-ibm-watson-project-fails-journalism-related/ https://www.healthnewsreview.org/2017/02/md-anderson-cancer-...
- pishpash 9y agotl;dr: US spends so much more than other nations because US hospitals (and by extension, doctors, which NYT is too chicken to say out loud), keep increasing prices for the same care. There is nothing here about insurance companies. It's lack of competition on the supply side.
- throwaway5752 9y agoNo, it is not a supply side problem. Why do you thing that? Compare the US system to other systems' cost of care and providers per capita.
- tomjakubowski 9y agoThere's no competition at all on the supply side in Canada or Taiwan. Why are their health care costs microscopic compared to the US?
- phnofive 9y ago
- thomastjeffery 9y agoNow can we have a "Why the U.S. Spends More than the Next Eight countries combined, and 63.7% More than The Entire Rest of The World on Defense"? https://en.wikipedia.org/wiki/List_of_countries_by_military_expenditures https://en.wikipedia.org/wiki/List_of_countries_by_military_... --- Oh wait, we spend even more now: http://clerk.house.gov/evs/2017/roll378.xml http://clerk.house.gov/evs/2017/roll378.xml
- lmm 9y agoThe US gets that much more military for its money. Look at the diagram on the bottom of https://www.globalsecurity.org/military/world/carriers.htm https://www.globalsecurity.org/military/world/carriers.htm . Or remember that the US Air Force is the world's biggest air force, the US Navy is the world's second-biggest air force, and the US Marines are the world's third-biggest air force. There's space for people to disagree on whether what we get out of the military is worth what we spend on it, but there's no mystery about where the money's going.
- thomastjeffery 9y agoI grew up on a US Army base. Believe me: There is plenty of mystery, and plenty more obvious waste. The most obvious is called "use or lose". Why in the hell do we need it? China has a billion more people, borders Russia, North Korea, Afghanistan, and Pakistan, yet spends less than a quarter as much as the US on defense, even by the most liberal estimates. I can see arguing the merit of spending more than every country on Earth. I would still disagree, but it would definitely be a discussion. However, the US contributes more than a third (closer to 1/2 now) of defense spending for the entire goddamn world. It disgusts me that my country takes so much money from its citizens, and throws it at all into a machine of death, whilst simultaneously blaming its egregious debt on Social Security.
- lmm 9y ago> China has a billion more people, borders Russia, North Korea, Afghanistan, and Pakistan, yet spends less than a quarter as much as the US on defense, even by the most liberal estimates. Sure. But it has no (conventional) power projection capacity, whereas the US has been engaged in two simultaneous occupations of outright hostile foreign countries literally on the other side of the world for a decade, at the same time as deploying troops to defend dozens of friendly nations all around the world, enforcing freedom of the seas again all around the world... . The front line of a US-China conflict would likely be Taiwan, that's what spending 4x as much is buying us. Again, we can argue over whether that's something we should be spending money on, but on the whole (of course there is some level of waste, as there is in all large organizations) we're getting what we're paying for.
- omarforgotpwd 9y ago"The US spends more on healthcare because the prices are higher!" Um, okay. Duh. A better question to ask would be: Why are prices not falling? In the "normal" economy, people can't offer any arbitrarily high price they want: They have to compete with others to offer their good or service at a low price. The more you raise your price, the more you invite competition and give them room to run a profitable business. Anyone who has gone to a doctors office or hospital lately knows why there is so much overspending in health care: The health care system is the most fucked up, overcomplicated, ridiculous system you could possibly imagine. You start out by filling out a big paper form with all your info on it... They use that to bill your insurance, which then says okay, we're going to pay you half of what you asked for. What ridiculously perverse incentives. Now the provider will naturally ask for twice as much, knowing they won't get everything they bill for. Health Care will be fixed not by laws or insurance companies, but by technical innovation and good old fashioned economics. You know, those old ideas Adam Smith had. If there was serious technical and economic / business model innovation in the industry (an Apple of health care) prices would go down, outcomes would improve, etc.
- pishpash 9y agoBecause there is no competition on the supply side. Do you shop around when you're gravely sick? Can you even get transparent prices out of hospitals?
- omarforgotpwd 9y agoExactly. There is no competition on the supply side. Suppliers are often granted legal monopolies as a matter of fact!
- PakG1 9y agoI'm so confused. Isn't that what's supposed to be so great about privatization in the US? Isn't that why so many in the US are against public health care? Some sarcasm here, but I also really actually don't get Americans sometimes.
- 9y ago
- ensiferum 9y agoBecause it's a business designed to make maximum profit?
- LoSboccacc 9y agothat's what subsidies to a private sector do, duh
- dmitri1981 9y agoIt's simple economics: third party payment. Patients want as much care as possible, doctors are incentivised to provide it and insurance companies pay for it. Until that changes healthcare costs will not decrease
- bildung 9y agoThat can't be the reason, as most other industrialized nations have that too, yet pay less.
- dmitri1981 9y agoSingle payer systems are popular and work well, but you are right that it is not the only solution. Countries like Germany use heavy regulation to manage the healthcare system. However, I don't think Americans would accept this level of "government interference".
- vidarh 9y agoThey already have that level of government interference, just not in the right way. That is the bizarre part of the US system - it might very well work better than today if it was actually a free market, but they've managed to get the worst of both: A highly regulated market where the regulations doesn't ensure proper service.
- hackeraccount 9y agoI used to think that. My only argument of skepticism is sort of weird. Animal health care costs. Apparently the cost of vets is going up just as fast as that of humans. And in that case it's mainly first party payment. It could be that the two have no connection but for me, it raises doubts. Honestly my current theory about health care costs is that they're high - and are inflating - because people like health care. There's a basket of potential goods and people really like that particular item. To get it they spend what they have and then pressure politicians to get them ways to spend money they don't have. They complain more and so the politicians find ways to hide the costs from them.
- jernfrost 9y agoPart of the reason it is more expensive in the US is because medical school is very costly in the US. This increases the financial risk of those aquiring a medical degree. Higher risks usually demands higher profits in the market. Hence free university education could be a factor in reducing US health care costs. Fundamentally you see how the free market approach to everything drives up costs everywhere. Or more specifically drives up costs in industries/services which don’t naturally have functioning markets. Free market approaches to health care found in Europe or Asia that works tend to be strongly regulated. E.g. max prices for procedures
- xyzzyz 9y agoPart, but definitely not the main reason. If the doctors worked for free, US would still be more expensive than Germany or Japan.
- epmaybe 9y agoAgreed. There are around 80,000 medical students in any given year in the US. Assume that all of them pay $50,000 per year in tuition. That's maybe $4b per year. The costs of health insurance, diagnostic testing, pharmaceuticals, etc more than eclipse that number.
- bkmartin 9y agoAnd the bigger problem is that there is profiteering at every step of the way... Medical Insurance, devices, private testing labs, hospitals, doctors, pharma...it all adds up. As someone else said, it's a free market without a real market for competition... I don't remember where I heard it, so citation needed, but the number that sticks on my head is that we spend 25% on administration alone. Lots of billing companies exist just to handle the complicated mess we have created... More profits in the system.
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- tomohawk 9y agoIt's hard to contain costs when there is no transparency regarding them. Just try to figure out the price of a medical procedure. The prices of procedures vary depending on who you are. Having the need to get a particular type of MRI every few years, I call around looking for 1) the equipment the facility has to do the MRI, and 2) the cost. It's hard enough to get #1 (there's a large disparity in quality of MRI based on equipment). #2 is practically impossible to get, and has no correlation to the equipment quality. If providers were required to be fully transparent on pricing, and provide the same price to all, then you might see cost containment.
- spiderfarmer 9y agoI think the US could easily solve this if they wanted to, but from my (Dutch) point of view: - The US is philosophically much more egotistic than other developed countries - Politically the US is the most divided western country with its two party system - Money in politics means it's one of the most corrupt, preventing solutions that could serve its citizens - Conservative media does a very good job at keeping at least 50% of the country comically uninformed - The "American Dream" gives people the impression that working hard solves everything and that their country is the best in the world period - Religion is not focussed on empathy at all anymore, if it ever was The billionare .0001% will probably do their utmost to keep the status quo, as evidently, they are the ones that are profiting from the current situation and they are the ones calling the shots for the next 3 years. The US is doing very good in a lot of areas, but I think collective egotism is preventing it from reaching its true potential.
- kulu2002 9y agoVery true. While chasing American Dream people of America have become very much business minded and profit-centric. American egoism basically means looking for "Whats in it for me?" everywhere.
- staticelf 9y agoThe funny thing is that, per capita, many european countries has more billionaires than the US. That's saying something about "The American Dream" imo. What I meant is that the billionaires maybe doesn't need to uphold the status quo?
- spiderfarmer 9y agoAnd that taxes aren't as bad as they think.
- mrarjen 9y agoTaxes would be a whole of a lot better if they didn't let you pick all the products and then during payment add the % of tax on top of it! Just include it in the price!
- baybal2 9y agoMy guess: People with some money will pay through expensive insurance, and everybody else can't pay at all. This way, pharma and hospitals have near 0 incentive to focus on people with anything less than mid to high tier insurance plans. And everything else results from that, like regulatory capture by insurance companies and everybody teaming up with them. Even without draconian restrictions on generic drugs, labour mobility in medical professions, and needlessly elevated standards of care in hospitals for many conditions, medical treatment in US will still be out of reach of majority, and the market will still be skewed towards high tier insurance plan holders. A more radical, slash and burn reforms will be required by US to reach countries with private, but affordable to masses healthcare. I can draw a parallel with restaurant or affordable clothing markets in my home country - Russia. In the centre of Moscow, you have countless fancy restaurants that are nearly always empty. Those ones have $30 average price for a basic meal. At around 10 km away from the Kremlin, you begin to see rare soup kitchens serving <$1 meals with 100+ people line ups during lunch hours accommodating everybody with less than $2k USD of monthly income. See, if a fancy restaurant will serve even two customers per hour, it will get more money than a soup kitchen. The same situation, if not worse goes for affordable apparel. Most people can't afford anything more than an "Abibas" tracksuit for $2, yet you genuinely can't find anything that cheap in Moscow's urban core. Putin ordered the only public market in Moscow serving the masses to be crushed, and its owner prosecuted in a show trial, just out of resent for its existence showing the extend of poverty in the country.
- hellofunk 9y agoSomething I've always heard but not mentioned in this article is that America is a very litigious culture, everyone sues everyone for nearly any reason, which is uncommon in most parts of the world, and doctors must have lots of malpractice insurance to guard against this; and when doctors pay a lot for insurance, they must increase their prices to help cover that, and the wheel spins that way.
- juhanima 9y agoThe math in the article is not quite right. Growth from 1.2 trillion to 2.1 trillion in 17 years (1996-2013) only amounts to 3.3% annual growth, which is not that far away from the 2.4% of the overall economic growth. The U.S. does spend more per capita than any other country, with Switzerland, Luxembourg and Norway being the runners up. https://www.npr.org/sections/goatsandsoda/2017/04/20/524774195/what-country-spends-the-most-and-least-on-health-care-per-person https://www.npr.org/sections/goatsandsoda/2017/04/20/5247741... I think that statistics gives a hint: the richer the country, the more it can afford to spend. Also the mostly private health care sector in the U.S. doesn't have similar incentives to cap their spending at a certain point as their publicly funded counterparts in Europe. There must be a lot of cases where a rich person buys expensive treatments for a terminal illness that would be deemed hopeless and left untreated elsewhere, and that has to show in the statistics somehow. I don't consider this a big flaw in the U.S. system.
- Broken_Hippo 9y agoThere must be a lot of cases where a rich person buys expensive treatments for a terminal illness that would be deemed hopeless and left untreated elsewhere, and that has to show in the statistics somehow. I don't consider this a big flaw in the U.S. system. Probably not a lot, since most people aren't rich. But more to the point: That stuff happens other places as well. I'm in Norway, and there is a private healthcare system. Most of the time, I hear it being used for shortened waiting times or more luxury in the hospital, but I'm pretty sure rich folks can go to other lengths - on their own dime. This doesn't affect the state much because it isn't their freaking money. Also the mostly private health care sector in the U.S. doesn't have similar incentives to cap their spending at a certain point as their publicly funded counterparts in Europe. I think this is correct, but I think the fragmentation is what causes it. The fragmentation means there is no incentive to combine resources to make things cheaper and easier. Where I live in Norway, people can have - free - up to 6 nurse visits a day. Even if you live on an island or are spending your summer in a remote cabin. All because overall, the outcomes are good. People live longer, happier lives the longer they can be at home and it is cheaper than sending the same people to a nursing home.
- 9y ago
- zhyder 9y agoLack of price transparency feels like a big part of the problem here. It's nearly impossible for a consumer to shop around based on price, allowing prices to go up freely. I'm actually surprised healthcare providers can legally be as opaque as they are: how is it okay to charge arbitrary amounts after the fact and require the consumer to pay? Even car mechanics make upfront estimates and get them signed by the consumer, because otherwise the consumer might refuse to pay. Why doesn't the same happen in healthcare for at least non-emergency procedures?
- sethammons 9y agoI see a retina specialist twice a year. I recently changed to a high deductible plan with an HSA. I called to see what the cost of my appointment would be. They could not or would not tell me. Incall three separate times, talking to different people and different departments. I went in and continued asking the front desk. "It depends on the services you end up getting." Ok, sure, but for a standard appointment, what then? "I can't say." Listen lady, I'm looking for a ball park. $50? $100? $1000? $5000? "Oh, I can't imagine it will be that much." Which one? "We will have to just bill you after." So absolutely frustrating. It ended up being like $150. Without price transparency like a public menu, we won't get better.
- kthejoker2 9y agoHad the same experience with my son's ear infection on a holiday weekend. Received a bill for $900. I refused to pay it, I wrote them and said I had asked to receive an itemized list of charges for a typical ear infection and had been refused and that if these prices were known at the time of the service I wouldn't've undertaken the service. So of course they came down to $450 without even batting an eye. Complete madness. I've still never paid it, with no apparent consequences.
- SilasX 9y agoBingo. Healthcare is the only place where courts will tolerate a contract where a patient "consents" in advance, to paying any amount without bound.
- partycoder 9y agoThe US jumped the shark in 1971. A comeback is very unlikely. After WW2, the US established a system that was used extensively for its own economic advantage: Bretton Woods. Many countries could use dollars as their reserve currency, and those dollars could be redeemed for gold. The US abused this system by printing more dollars than what it had in gold, giving rise to the concept of "exorbitant privilege" (virtually unlimited money with no chance of accountability). This started some sort of bank run and since the US did not have enough gold, Nixon suspended the convertibility of dollars into gold. After that, dollars were allowed to float, and if it wasn't for exclusive deals (e.g: oil), it would have a much lower value. Now spending on healthcare, education, infrastructure, science, space exploration: all gone.
- dandare 9y agoCould this problem be attacked by a goodwill billionaire with a long-term plan? Open several private medical schools that will offer "free" med education in exchange for multi-year contracts. Open many small copycat clinics. Manufacture your own generics if possible, import whatever is cheapest, focus on things you can do cheap, be transparent about pricing, build awareness and brand. McDonaldize/Amazonize American healthcare.
- Dowwie 9y agoAre you familiar with the path that an American needs to take in order to become a cardiologist capable of financially supporting a family in a city where their children can realize their potential? The system that creates an American cardiologist is designed such that the cardiologist and it's respective delivery system will charge as much as economically possible for services. There aren't many cardiologists in the country and that is by design. A hospital can't even establish itself without the explicit consent of other hospitals already operating in a region -- healthcare entrepreneurs require a "certificate of need" issued before they are permitted to open a new hospital -- and dare not compete. The American Medical Association, medical schools, lenders, cardiologist fellowship programs, and others play a role in manufacturing a cardiologist. Everyone is participating in the system as a profit seeking, economic growth oriented player. Long ago, their objectives shifted to maximizing shareholder value and honoring fiduciary responsibilities. No one has managed to control the cost of care in a system like this.
- fedups 9y agoI was hopeful to see something about the difference in how countries control the supply of doctors, but looks like we'll need to wait longer till someone thinks to look into it. These well-trodden 'insights' must be too tempting.
- maxerickson 9y agoCONs aren't required in all states (and none at the federal level since the 1980s). http://www.ncsl.org/research/health/con-certificate-of-need-state-laws.aspx http://www.ncsl.org/research/health/con-certificate-of-need-... States that don't have them don't have dramatically lower prices.
- Dowwie 9y agothis is good to know (OC)
- rgbrenner 9y agoEvery state except LA had a CON law.. You can't restrain supply for a couple of decades, then repeal the law, and immediately say: see, there's no difference. We're already seeing a difference in prices after a few years[0].. and it takes years and hundreds of millions of dollars (up to $1B+) for a hospital to go from a proposal to operating: CON laws raise overall healthcare spending by 3.1 percent—5.0 percent for physician care. As for type of provider, while CON has little effect on Medicaid spend- ing, it increases overall Medicare spending by 6.9 percent. States that repealed CON laws have seen overall healthcare spending reduced by 0.8 percent per year, leveling out to a 4 percent drop after year five. The greatest decline in spending is with physicians at 1.4 percent per year, compared to a drop of 0.3 percent per year in hospital expenditures. And by constraining supply of beds, hospitals redirected investment into equipment, increasing per-unit costs of providing care [1,2]. Arguably CON laws have contributed to unnecessary tests (since hospitals need to use the equipment they buy to pay for it), and use of more expensive equipment than necessary. Of course this isn't the sole problem with our health system... there are many that contribute to the problem. But CON laws are negative, and are one of the issues we need to deal with if we want to reduce health costs. 0. https://www.mercatus.org/publication/health-spending-reined-in-CON-laws https://www.mercatus.org/publication/health-spending-reined-... 1. https://jhu.pure.elsevier.com/en/publications/impact-of-state-certificate-of-need-laws-on-health-care-costs-and-4 https://jhu.pure.elsevier.com/en/publications/impact-of-stat... 2. https://www.mercatus.org/publication/do-certificate-need-laws-limit-spending https://www.mercatus.org/publication/do-certificate-need-law...
- snarfy 9y agoThere is no competition. The day there is competition is the day you walk in to your doctor's office and the prices are posted above the reception desk like a restaurant menu. $50 general visit, $75 for a broken arm, $100 treat common infection, etc. You don't see prices because you don't pay. Insurance pays. If you are ever without insurance and have to pay, they always have different, lower rates. Doctor's scamming insurance companies, insurance companies scamming the government, the government scamming all its citizens.
- peacetreefrog 9y agoThis is the root cause, the fact people don't pay for their own healthcare and there's no competition. Then we layer on this huge complicated system to try to contain costs other ways.
- meri_dian 9y agoDoctors, surgeons, nurses, lab techs, hospital bureaucracy and staff, etc.... All of these people need to get paid, and in the US they get paid very well. High health care costs are not a mystery or a conspiracy. There are just many people in the industry that make a lot of money, and they charge high fees to maintain their incomes.
- pas 9y agoThere's too much money in the system, both private and public, thus supply-and-demand equilibrium results in high costs. And the supply is carefully limited by healthcare providers. (The middleman takes the profit, so why would the number of actual doctors increase?)
- hackeraccount 9y agoThat's such a simple thing and yet no one seems to acknowledge it. Look at Obamacare, it's going to lower health care costs. How? Savings! What does that mean? Everyone you don't like won't make as much money. All the people you like will keep getting paid. I understand we all hate health insurance and pharmaceutical CEO's but taking them out back and shooting them will save less then is commonly understood. The same goes for money wasted on advertising. Saving money on health care is (to repeat an oft told joke) like going to heaven. Everyone (Republicans and Democrats both) wants to do it but no one wants to die.
- brohee 9y agoThe hospital bureaucracy is out of control in the US. See http://www.commonwealthfund.org/publications/in-the-literature/2014/sep/hospital-administrative-costs http://www.commonwealthfund.org/publications/in-the-literatu... As for the cause, start with https://www.nytimes.com/2014/05/18/sunday-review/doctors-salaries-are-not-the-big-cost.html https://www.nytimes.com/2014/05/18/sunday-review/doctors-sal...
- saint_fiasco 9y agoThey probably need that income to pay their debts. Becoming a doctor is not cheap.
- rdlecler1 9y agoYou have huge variation in the life expectancy between rich and poor individuals in the US. Here you have a lot of poor people with no healthcare and then you have more affluent people who may be spending hundreds of thousands of dollars a year on healthcare. If I have a few million dollars saved and I can spend a couple hundred thousand to live a few more years there’s a good chance that I’ll take that option. This system is not intended to provide the greatest benefit to the most people but rather to provide the greatest benefit to those people who can afford it. Coming from Canada and seeing the quality/detail of care you get with private insurance here is astounding. There is certainly a lot of fat in the US system but it’s also incredibly comprehensive if you’re fortunate enough to have good insurance.
- bob_theslob646 9y agoA lot of these comments due a great job of hitting the nail on the head on most issues, but I have not seen someone talk about the fact that the United States believes in treating versus _prevention and or curing_.
- wu-ikkyu 9y ago>he sacrifices his health in order to make money. Then he sacrifices money to recuperate his health. And then he is so anxious about the future that he does not enjoy the present; the result being that he does not live in the present or the future; he lives as if he is never going to die, and then dies having never really lived. -Dalai Lama
- mtgx 9y agoIt's not that Americans spend the most, either, but also the fact that unlike other governments, the U.S. government has little incentive to fix national healthcare crisis, especially when Big Pharma benefits from those crisis and lobbyists against the fixes. In countries where the government foots the bill for healthcare, and healthcare is obviously a big portion of their expenses, the government will usually scramble to do everything it can to improve the population's general health. That includes trying to limit pollution, better regulating the "food" that comes on the market, and so on.
- nybble41 9y ago> In countries where the government foots the bill for healthcare, and healthcare is obviously a big portion of their expenses, the government will usually scramble to do everything it can to improve the population's general health. That is actually one of the bigger problems with the single-payer system. Your health is fundamentally related to everything you do, and consequently giving the government an interest in your health opens the doors to monitoring and controlling every aspect of your life in the name of regulating health care costs. In forfeiting the liberty to do things which may negatively impact your health then you become not a free individual, but more akin to the government's pet, your every action subject to their approval.
- dynofuz 9y agothe problem is that the people telling you what to do (the healthcare providers / docs) are getting paid to provide services to you. additionally, insurers are not smart enough to communicate the costs and benefits to patients appropriately. we need a decoupling of the guide (maybe insurers that are actually good) that tells patients what to do next for optimal care and the org that provides the care. that way providers (docs) dont have an incentive to say do more if more isnt helpful
- avoutthere 9y agoGovernment setting rates for medicare/medicaid reimbursement is what has driven up prices. One of the brilliant aspects of market economics is that, if allowed to operate freely, the market would establish price points for all levels of service. Government involvement is preventing the market from functioning as it should.
- zip1234 9y agoLiving in the US and having to pay the high deductibles for health care, here is my idea: - price transparency - The problem is not easily being able to shop around for procedures and doctors. It is extremely difficult to know how much things will cost. If the prices have to be published in some way so the cost is known up front, the price will go down. Many people's insurance doesn't start paying until after the deductible. Most people just pay the price whatever it is because it is impossible to know how much something will cost until after. Of course, this means that hospitals can charge whatever they want with no recourse. When insurance companies pay, they fight back and get lower prices, but people can't do that. Voting with their feet will increase competition and drive down costs.
- advisedwang 9y agoPrice transparency doesn't help when you don't realistically have a choice. If I'm going to ER or taking an ambulance I can't check prices to decide what hospital to go to. If I'm in hospital and need surgery I can hardly decide to change hospital because their surgery is cheaper. When my I discover on my bill that my doc consulted with an expensive expert, it's too late for me to ask her to use a cheaper one. Hospital's aren't like grocery stores.
- yeukhon 9y agoWhen it comes to emergency, you probably right we can't shop around. But when it comes to taking medication, there should be a price. In HK, we can find out the price of a treatment or a surgery from the hospital's website. Maybe not the full exact amount, but close enough for someone to know what to expect. There shouldn't be a "we will take care of the rest of your treatment and send the bill to you" as in your own story.
- nybble41 9y agoEven with regard to emergencies, there is no reason you can't shop around in advance so that you already know which hospital you want when the emergency occurs, given that there is more than one in your area.
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- motiw 9y agoSimply because it is acceptable to maximize profit from people fears and misery, coupled with shameless politicians that support/bend to the will of the health care mafia with a regulation environment that diffuse any incentive to lower cost
- fallingfrog 9y ago"Because it's more expensive" seems like a non-answer to me. Why is it more expensive, and who's getting the money, and what rules are allowing this to take place, and who made those rules? That's what we need to know.
- EGreg 9y agoIt's a simple reason: Monopsony Power of collective bargaining drives the price down. The AMA and other collectivizations of providers drive the price up (cartels). That's why becoming a doctor in the USA is such a long and hard ordeal, relative to other countries. And also why litigation is so high. Oh and of course... THE PATENT SYSTEM causes the USA to pay for most of the innovation that scientists in the redt of the world are prevented from building upon with open source.
- geebee 9y agoIt's fascinating, and kind of horrifying too. I've of course been a patient, and I saw the initial bill for a neck injury that led to no treatment other than Tylenol - $16,000. My HMO paid about half that, I believe. I was not on the hook for the difference. This is negotiated by contract between the HMO and the hospital. The high bill is the beginning of negotiations between two large and powerful organizations. Here's the thing - lacking access to good health care in the US is even worse than not being able to pay the bill. It means you get stuck with the higher bill, and no pre-negotiated contract or negotiators to knock it down. I've talked to people who work at hospitals, and they say their billing department may knock it down a bit, but it means that the person not represented by an HMO or similar gets hit not with an $8,000 bill but one much closer to $16,000. I know I'm supposed to hate my HMO and everything, and they can be irritating, but there's no way I'd want to experience the US medical system as an "independent". As you said, you're already dealing with a Monopsony. It's worse, because you don't know what they're charging, whether it's important, whether it should be done, none of it. And it is run by something closely resembling a cartel, the AMA and hospitals simply do not operate in anything remotely resembling a free market. I guess my HMO is my government backed cartel. I pay through the nose for the insurance (well, my employer "pays" some of it, but it's all through the employer, so what does it matter the portion that is added to and then deducted from my actual paycheck vs the part that never makes it to my paycheck and is paid on my behalf?). But as a result, I have a powerful cartel on my "side". When I describe the AMA as a cartel, people often think this means I oppose occupational licensing entirely. No, not necessarily. That's an interesting discussion, but there is plenty of room to criticize the AMA (and other professional and trade licensing bodies). while supporting some limited form of occupational licensing (actually, you could support substantial licensing and still be appalled with the AMA and ABA).
- aaavl2821 9y agoMuch of the cause of the high cost of care in the US is not social, or political, or demographic, but economic: The single biggest line item in the US healthcare budget is hospital care The price of hospital care (as measured by cost of inpatient bed day, [1]) in the US is on the order of twice as high as that of France, Germany and the U.K. The time period where the cost of US healthcare in OP article separated from other countries coincides with the increase in hospital consolidation in the US Hospital consolidation is demonstrated to lead to increase in price without commensurate increase in care [2] There are other factors as well, but this is probably the single biggest cause of high US healthcare cost, and it's almost never discussed Good article with historical context here: https://www.nationalaffairs.com/publications/detail/the-perils-of-hospital-consolidation https://www.nationalaffairs.com/publications/detail/the-peri... 1: http://www.who.int/choice/country/country_specific/en/ http://www.who.int/choice/country/country_specific/en/ 2: https://www.rwjf.org/en/library/research/2012/06/the-impact-of-hospital-consolidation.html https://www.rwjf.org/en/library/research/2012/06/the-impact-...
- BugsJustFindMe 9y ago> The price of hospital care (as measured by cost of inpatient bed day, [1]) in the US is on the order of twice as high as that of France, Germany and the U.K. And why do you think that is? Everything is political, including economics.
- aaavl2821 9y agothe articles i linked suggest it is in part because of hospital / health system consolidation leading to higher negotiating power. i think that is an economic factor, although i think i can see where you are coming from i assume youre suggesting that having a single payer would balance out the negotiating dynamic? that could certainly be the case. to be pedantic, if the US does get a single payer system, one could argue that the political act of creating a single payer system is driven by economic factors (local provider monopolies increase cost of care, payers adopt high deductible plans in response, people suffer financially as a result, therefore vote with their wallets) i dont think politics supersedes economics or vice versa, theyre very intertwined
- bawana 9y agoBertolini the CEO of Aetna walked away with a $500 million parting gift. Courtesy of your healthcare premiums. There's the fox guarding the henhouse off to a new henhouse. STOP THIS OBSCENITY of administrators paying themselves so much to work in a risk free environment. When they run red ink, the government bails them out. Taxpayers again - shafted from both ends. We should find this guy and put him in a stock, the kind the puritans used, not the Wall Street kind,
- treyfitty 9y agoI have a friend who worked with the billing system at a major hospital in Florida. Beyond the obvious practice of providers billing for much more than the actual cost of service, to maximize insurance reimbursement after rounds of "negotiations" after each client, there is something more insidious going on as an industry. My friend (anecdote, sure, but something like this will never be written in policy, so I can't cite) said "we were told NOT to send anything to collections unless the amount was "very high." He was then told that the hospital was made whole with every insurance reimbursement, and that any amount "owed" from clients aren't actually a big deal- if they pay it, great, if not, it's alright. Furthermore, the impetus for not sending to collections was because there is a certain threshold where if the populous found out about their many shady billing practices, they would be exposed, and would rather not deal with that. I'd like to say that I am surprised nothing has been done about this, but I'm honestly not surprised because the incentives and economics are there in your face.
- yeukhon 9y agoI am sorry, but I read it three times and I am still unsure how the practice helps the providers? I was looking for "stealing more from clients", but I can't deduce any from this anecdote.
- MarlonPro 9y ago..And US is not more healthy than the other advanced nations.
- mwilliaams 9y agoI think a lot of it is due to America being so litigious. Doctors and hospitals are afraid of being sued, so they need lots of insurance to protect them, and they order lots of arguably unnecessary tests to cover all their bases. This drives up costs for consumers.
- qwertyml 9y agoBecause of the fraudulent agents in the insurance, healthcare and government. And the innocent american citizens who nod yes for every crap policy and rule that is thrown at them. Isn't it obvious? Same medical service costs 10 times less in other countries for same or better quality. Because they have kept the service of a price 1$ as 100$. We need some disruptor to simply crush the insurance industry. If you don't take insurance you may become medical bankrupt if somewhere you screw up your health. They started with 1 $ few decades back and slowly increased and since world has majority of un smart people people collectively couldn't find a just system. And everyone and every future generation has to pay the price for the mistakes previous generations made. Its just is hell guys.
- lsc 9y agoThe thing I keep wanting to bring up: >Higher prices aren’t all bad for consumers. They probably lead to some increased innovation, which confers benefits to patients globally. Though it’s reasonable to push back on high health care prices, there may be a limit to how far we should. Fundamentally speaking, much like education, while I agree that healthcare is unaffordable to many, I point out that this is different from being too expensive. I think the idea that we are spending too much of our wealth on education and healthcare is... wrong. I mean, sure, there are limits on what we want to spend, as a society, on healthcare, and yes, I personally think that a lot of the public money being spent on healthcare (and I think a lot of public money should be spent on healthcare) should be spent on research that benefits all, but overall? as a society? I don't think spending 17% of our GDP on healthcare is a problem (assuming we're receiving good benefits from that, which I think we are) And yeah, maybe there needs to be 'community college' equivalent of healthcare; a system where anyone can show up and get care that is good but not the best for next to nothing. And yes, we do need more and better-funded research for the public good. I certainly don't have a problem with private industry researching new drugs for us, but we have to understand that their incentives are... different, and that there's a place for public-funded work for the public-interest.
- intopieces 9y ago> I think the idea that we are spending too much of our wealth on education and healthcare is... wrong.[...]I don't think spending 17% of our GDP on healthcare is a problem (assuming we're receiving good benefits from that, which I think we are) You're missing a dimension to both of these numbers: Outcome. The U.S. spends more on healthcare than any other country — but not with better health outcomes [0]. "The US stands out as an outlier: it spends far more on health than any other country, yet the life expectancy of the American population is not longer, but actually shorter than in other countries that spend far less." [1] [0]http://beta.latimes.com/nation/la-na-healthcare-comparison-20170715-htmlstory.html http://beta.latimes.com/nation/la-na-healthcare-comparison-2... [1]https://ourworldindata.org/the-link-between-life-expectancy-and-health-spending-us-focus https://ourworldindata.org/the-link-between-life-expectancy-...
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- crimsonalucard 9y ago>Why the U.S. Spends So Much More Than Other Nations on Health Care The conclusion of the article: Because prices are higher. Seriously?
- MintPattern 9y ago> There are ways to combat high health care prices. One is an all-payer system, like that seen in Maryland. This regulates prices so that all insurers and public programs pay the same amount. A single-payer system could also regulate prices. If attempted nationally, or even in a state, either of these would be met with resistance from all those who directly benefit from high prices, including physicians, hospitals, pharmaceutical companies — and pretty much every other provider of health care in the United States. And then end up like Venezuela has after implementing price controls? How about you let intelligent macroeconomics majors who have spent years in college studying exactly the ideal solution to this predicament give thoughtful and effective solutions. I understand the writer was likely good intentioned, but: 1) The road to hell is paved with good intentions. 2) For every complex problem there is an answer that is clear, simple, and wrong. While some liberal arts majors have their own theories and hunches to inject on how our world economy should run, a well-studied economist would give the best answer for providing a solution that establishes the perfect price-point between satisfying as much of the medical demand as possible while having a never-extinguished supply of medical care. A little history: During the great depression, the US implemented price controls on wages; capping the wages. So companies started adding in health coverage in with the job as a perk instead. The great depression was extended and the health insurance in our country has been forever screwed up by that event. Btw, I'm not pro government or anti-government, left or right. I'm pro-lets-get-the-facts-straight-before-we-jump-to-conclusions-that-affect-the-whole-country. Admitting that you don't know the answer to something goes a long ways.