Readers of The Medical Care Blog know that the United States spends more money than any other country on healthcare. Currently, the US spends about 18% of its gross domestic product on health care, and it is predicted to grow to nearly 20% by 2026 [PDF]. While the growth rate in spending remains near historical lows, it is telling that spending per person exceeded $10,000 in 2016, for the first time in history.
Despite spending nearly twice what other industrialized nations spend annually per capita, health outcomes remain poor. The US ranks higher in infant mortality and has a lower life expectancy compared to other highly developed nations. Those are just two of many indicators showing poorer outcomes. Mortality amenable to health care—a composite measure of preventable deaths—remains far higher in the US.
If our health outcomes were vastly superior to those in other nations that spend less on healthcare, it might justify the added cost. Compare it to buying a car: If I spend more on a luxury car, I am paying for increased reliability, better engineering, and more pleasing aesthetics. Essentially, the higher amount spent on the luxury car can be rationalized by the added benefits I might receive.
In the US healthcare system, however, we are paying for a Tesla and getting a Ford Pinto.
In a thoughtful series of articles in the New York Times in 2014, Elisabeth Rosenthal addressed the outrageous costs of medical care in the US. She notes that in the US commercial healthcare market, there are no set prices for any procedure or drug. Instead, “prices rise to whatever the market will bear.” The US is unique among other industrialized nations in that it does not regulate medical pricing, aside from setting rates for Medicare and (in some states) Medicaid. Rosenthal asserts that there are no other developed countries with as few mechanisms for price control.
These issues have hit home recently. As a newly minted Physician Assistant, I have been troubled by some of my observations and experiences with prices in the medical system. A friend and classmate went to the emergency department last year for three hours for an abdominal complaint. She accumulated a bill totaling almost $16,000. Her CT scan alone cost $7,000. Her emergency room visit cost more than the price of a hip replacement in Belgium. Where is the logic in this? After insurance adjustments, my friend ended up paying $650 out-of-pocket, which was for her — a graduate student, living off of loans — a tough pill to swallow.
Another classmate fared even worse with medical bills resulting from an emergency department visit for chest pain and palpitations. After a full work-up (EKG, chest x-ray, CBC, CMP, troponins), she was discharged home with a diagnosis of anxiety and sent a bill for $4,162, which did not include the $300 in-hospital co-payment, the $637 physician fee or the $63 fee for the chest x-ray. At the time, she had a bronze-tier Obamacare plan and had come nowhere close to meeting her $6,000 deductible. She tried to negotiate with the hospital, but as she had no bargaining power, her request to have the bill lowered was denied. She might have paid less had she not had insurance!
It seems absurd that the cost of a service—one that may determine the difference between life and death—could be “negotiable”. To add insult to injury, most people are not made aware of the costs of services until after they receive their bill in the mail. Why hasn’t the current pricing system—reminiscent of a used car sale lot—been deterred by any legal intervention? For example, even though the Affordable Care Act placed limits on annual and lifetime out-of-pocket costs, still one-third of Americans report difficulty paying their medical bills. Why do we still allow people to end up in medical bankruptcy?
The US healthcare system seems to be less about what is good for patients, and more about what is good for providers’ bottom line.
Consider the flow of money.
A high school teacher of mine used to tell our class, “When money speaks, few are deaf.” This is precisely why the lobbyists working for big pharmaceuticals, hospitals, insurance companies, and medical device companies spend more on their agendas than the NRA or any other group.
So, who is getting rich? Everyone that has a stake in marking up drug prices a hundred-fold over what they actually cost [PDF]. Everyone that gets a cut from a MRI costing several thousand dollars. Every shareholder invested in any medical industry. Every lawmaker whose campaign receives generous donations from the companies who seek to reinforce their position of unbridled greed. Perhaps this is just business as usual, but profit-motivated care has a real impact on people.
Interestingly, I recently worked with a physician from Germany. After receiving his medical training, he left to pursue his dreams far away from the European mainland. I asked why he left Germany, and he responded by saying he was not content with the “socialized” aspects of life in his homeland. He felt that there was little incentive to be industrious or hard working. Moving to the land of blue jeans and rock-and-roll would provide him with “opportunities” (read, profits) not available to him in his home country.
Although I found him to be a brilliant physician, an excellent teacher, and a compassionate caregiver, he seemed to be, like many people, driven by money. And I would be hypocritical to say I am not myself driven by money. I hope to make enough money to afford living in the Bay Area, enjoy the occasional fine meal, and take snow trips to the Sierra Nevada.
But I also want to live in a place where I—and the patients I care for—do not risk losing everything if we have the misfortune of becoming sick.
At some point, the people of this country will realize that free-market healthcare is unsustainable. Despite concerns over socialized medicine, it would likely be more cost-effective in the long run to establish better regulations on medical costs. This would not remove the ability to profit—though it would hopefully reduce many of the excesses—but it would restore integrity, logic, and reason to an industry that is supposed to be rooted in both scientific principle and compassion.
Deborah Bergman