The real reason American health care is so expensive

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Published 2017-11-30
Hint: single-payer won’t fix America’s health care spending.

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Americans don't drive up the price by consuming more health care. They don't visit the doctor more than other developed countries:
international.commonwealthfund.org/stats/annual_ph…

But the price we pay for that visit - for a procedure - it costs way more:
static1.squarespace.com/static/518a3cfee4b0a77d03a…

The price you pay for the same procedure, at the same hospital, may vary enormously depending on what kind of health insurance you have in the US.

That's because of bargaining power. Government programs, like Medicare and Medicaid, can ask for a lower price from health service providers because they have the numbers: the hospital has to comply or else risk losing the business of millions of Americans.

There are dozens of private health insurance providers in the United States and they each need to bargain for prices with hospitals and doctors. The numbers of people private insurances represent are much less than the government programs. That means a higher price when you go to the doctor or fill a prescription.

Uninsured individuals have the least bargaining power. Without any insurance, you will pay the highest price.

For more health care policy content, check out The Impact, a podcast about the human consequences of policy-making.
itunes.apple.com/us/podcast/the-impact/id129432582…

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All Comments (21)
  • @hohepa1004
    Shattered my knee in an accident, ambulance takes me to hospital then transported to another hospital because that’s where the specialist is, had two surgeries and it didn’t cost me anything, now I receive 80% of my salary until I’m able to return to work. This is right of every New Zealand citizen
  • @dylancosto
    I had my first severe panic attack and thought I was severely sick so I drove myself to the hospital in Miami, I sat on the ER bed for 30 minutes and started to feel better, I left without treatment and was charged 1,200$. Without. Treatment.
  • @LewisAtonn
    The exorbitant cost of healthcare in America is a result of several complex factors. Firstly, the country's fragmented healthcare system leads to inefficiencies and administrative overheads, with multiple layers of bureaucracy and paperwork increasing expenses. Additionally, the high prices of medical services, pharmaceuticals, and equipment contribute significantly to healthcare costs, fueled by a lack of price transparency and competition. Moreover, the prevalence of costly medical procedures, defensive medicine practices, and a fee-for-service payment model further drive up expenses. Addressing these systemic issues and promoting reforms focused on efficiency, affordability, and accessibility is crucial to mitigate the burden of healthcare costs on individuals and the economy.
  • @DanielVazquez
    In the US, if someone finds a way to charge people for breathing outside, they will.
  • @kaanerdem2822
    I met an american he told me he had planned to undergo a teeth surgery to take out 2 teeth for about 3500$ but instead he bought a ticket trough a college he knew and came to Turkey to undergo that same surgery + had a vacation in an 5 star hotel for 5 days for less then 1500$
  • @genbabez
    What’s worse is people can’t afford doctor visits and hold off going to the doctor until their health is so far gone. At that point your pretty much handed a death sentence.
  • @fhmf_
    I love the fact that you can pay $200 in the US for a regular check up compared to £0 in most of the EU
  • I was shocked when I realised that ambulances aren’t for free in the USA .-.
  • @SaugatDhar
    Imagine every local grocer refusing to reveal the price of the bread unless you are done eating that bread. Welcome to US healthcare system.
  • @thomas1699
    I am a US Citizen living in Japan. After seeing how Japanese healthcare works, I am afraid to return to the US and risk ruining my comfortable retirement.
  • @lordodysseus
    A few days ago, I had breakfast at home, went to the hospital, got hand surgery, and was home for dinner the same day. It cost me $10 for the bus fare.
  • @NaumRusomarov
    USA -- Land of the free(*). * Terms and conditions apply.
  • @Sao0011
    Other Countries : Patients USA : Omg!! A CUSTOMER
  • @user-yo7br5wb2z
    thank you america, now i appreciate living in southern germany even more than before. ive seen 150k bills for 1 week in an american hospital, thats basically ruining your and your families life in 7 days.
  • @sumanthbhat7879
    I saw a hospital bill of a person who had broken his neck while rock climbing, it was frikkin $346k for a week of treatment.
  • @elimartin3982
    Oh no, I’m having a heart attack. Let me just find the best price for a hospital that’s nearby
  • @jacobarmour6325
    Imagine paying to give birth This comment was made by the European gang
  • @redlancelot2634
    A single week alone being admitted to the hospital cost my grandma entire life saving and insurance.
  • As an old saying "It is cheaper to fly to travel to Spain in bussiness class flight, join equstrian club, ride a horse, break your femur there, getting it replaced, break it again, get it replaced again compared to getting it replace in america"