The United States accounts for more than 40% of global health spending. Healthcare spending made up 5% of the total U.S. GDP in 1960. In 2020, spending hit almost 20% of the total U.S. GDP. It’s a significant issue, but healthcare companies are determined to record profits.
Americans aren’t using more health care than people in other nations that spend less. U.S. residents pay more for each interaction. Hospitals, physicians, and clinical care made up more than half of the total healthcare spending in 2019.
Most Americans don’t have much of a choice for their insurance plan. More than 54% get health insurance through their employer. The lack of choice limits competition, which can drive prices higher.
According to federal data, annual per-person spending growth for workplace health insurance has exceeded the spending growth among Medicare and Medicaid patients in nine of the past 13 years.
- That rise is almost entirely due to higher prices because enrollment and demand for services among the commercially insured have barely budged, or fallen.
Even after decades of being health care purchasers, companies ranging from small shops to Fortune 500 companies may not fully understand the health coverage they’re buying and often pay more as a result.
With inflation in the news, healthcare costs are continuing to rise. According to KFF, “the cost of health care often prevents people from getting needed care or filling prescriptions. Half of U.S. adults say they put off or skipped some health care or dental care in the past year because of the cost. Three in ten (29%) also report not taking their medicines as prescribed at some point in the past year because of the cost. Tho e who are covered by health insurance are not immune to the burden of health care costs. Nearly half (46%) of insured adults report difficulty affording their out-of-pocket costs, and one in four (27%) report difficulty affording their deductible.
The answer to rising healthcare costs isn’t easy, but to ignore this issue is sticking your head in the sand. As it stands now, our healthcare system is too profitable. The media, rightfully so, is focused on the high price of prescription drugs but prescription drugs still only account for $0.12 of every healthcare dollar spent.
A KFF survey from March 2019 found that about one-fourth of U.S. adults (26%) said they or a household member have had problems paying medical bills in the past year, and half of this group said the bills had a significant impact on their family (48% of those who had medical bill problems, or 12% of all adults). The share reporting their household has had problems paying medical bills has remained steady between about 25% and 30% for the past decade.
Eventually, a politician will have the courage to speak up and finally address healthcare CEOs’ high costs and salaries.