POLICY
THE AMERICAN HEALTHCARE SYSTEM EXCESSIVE EXPENSE AND SOME SOLUTIONS By
Rachel Zhang EJ Beck
It’s often best to do some thorough research before buying a new car. What kind of mileage are you looking for? What price range? What color? How large is the car? There are many different factors and careful considerations which can influence your final decision. When it comes to a person’s health, whether it be experiencing pain or a circumstance of life and death, you simply can’t afford yourself the same flexibility. While being rushed to the nearest hospital, placed in an emergency room as an uninsured patient, or undergoing life-saving surgery, the monetary cost or quality of care is not under your control. In short, any person requiring urgent or necessary healthcare has low market power with a limited capacity for price negotiation. The United States spent $3 trillion or $11,582 per person on healthcare as of 2019, a number that far exceeded the spending of any other industrial nation. Unfor-
tunately, American healthcare quality and accessibility rankings are not reflective of this high budgetary spending. America has lower life expectancies and higher rates of chronic disease, obesity, and suicide compared to other nations of comparable spending. With no uniform system and no universal coverage, uninsured Americans and those requiring out of pocket procedures often experience financial hardship and extensive stress due to their costly medical expenses.
Expensive Healthcare The reasons for these high expenses, and a brief explanation of the various complexities of American healthcare are as follows: I. The American healthcare system consists of a very wide range of insurance companies, both private and public, as well as
various pharmaceuticals, hospitals, and other parties involved in healthcare pricings and negotiations. Medicare or Medicaid are forms of public insurance which cover very many people. These companies can afford to negotiate for lower prices from hospitals and pharmacies because losing the business of a large insurance company such as Medicare or Medicaid means losing a massive number of profitable patients. Nevertheless, there are also several hundred private insurance companies, each covering a smaller number of people. The costs for care when negotiated by these companies is much higher as hospitals and pharmacies have the capacity to demand a higher price. In the case of an uninsured patient, healthcare providers have ultimate control over an unregulated, unnegotiated cost. The complexities of such a varied system and lack of universal coverage contribute to these higher expenses and inacces-
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