Why Is American Healthcare So Damn Expensive?

         Thank God my mother is teacher. Teachers have some of the best health insurance in the country. I get to take advantage of that fact until I'm 26 (the age at which I will no longer be covered by her insurance). I have a $10 co-pay for doctor's visits, pay next to nothing for prescriptions, and can be comfortable in the fact that I won't go into financial ruin if I break a bone. This, unfortunately, is not the case for most Americans. Those without insurance pay about $400 on average for their yearly physical, without including additional fees for imaging, materials used, or any other doctor's fees [1]. How about prescription prices? Lexapro, a common antidepressant, costs $579.15 on average for a month's supply without insurance [2]. This is significantly higher than the production cost [3]. This is not isolated to Lexapro. The average price for name brand pharmaceuticals was $365.12 per monthly dose as of 2020 [4]. Not just doctor's visits and prescriptions, but hospital visits and ambulance ride prices are also crazy expensive without insurance [5].  So, what the hell? Why is everything so damn expensive without insurance. The answer lies in the flaws of free market capitalism.

        The fact is, healthcare providers charge as much as they do because they can. America certainly imposes regulation on the free market. There are plenty of good things that government regulation has done to the healthcare system. The FDA is great for establishing standards for drugs and drug making processes. HIPAA and EMTALA provide safety and privacy for patients. However, America is hesitant to regulate the price of drugs, doctor's visits, hospital visits, etc.. Because of this lack of regulation, healthcare providers can jack up the prices of their goods and services. The answer seems obvious, have the government put price ceilings on healthcare expenditures. This way, healthcare will be affordable even for those without insurance. Of course, its not that simple. Private healthcare organizations make up many of the highest federal lobbying spenders. Healthcare organizations spent $600 million in lobbying in 2019 [6]. Essentially, healthcare providers are legally bribing those in power to keep healthcare prices unregulated. Even if a price ceiling was established, who do you think would control those prices? Money talks. 

        Okay, we have established that if you don't have insurance you are screwed.  So, if we get insurance do things get cheaper? Nope! To start with, monthly private health insurance rates can be atrocious. Without employer sponsorship, private healthcare costs $456 a month on average per person [7]. While public healthcare exists in America in the form of Medicare and Medicaid, only a fraction of the population qualifies for it. To make things even worse, health insurance often only covers a portion of medical expenses. Sometimes, if a treatment is too expensive, insurance will outright deny coverage. This leads to those with insurance paying the outrageous prices set by healthcare providers. One possible solution would be to regulate the circumstances in which an insurance provider can deny coverage. However, once again, those in power are paid to keep things the way they are.

        The free market is a good for things like groceries, electronics, cars, and so on. Consumers are able to be selective with what they buy based on informed decisions. The free market fails when it comes to healthcare. People cannot be selective and are forced into situations where they must take certain drugs, undergo certain surgeries, and make quick/uninformed decisions. Corporations have exploited the freedom they have to unfairly control the prices of medical expenditures. If we want America to have a better healthcare system, increased government regulation is necessary. If you feel empowered to do so, contact your federal/state/local representatives and push for fair medical pricing.