The Kafkaesque Nightmare of American Healthcare

Introduction

By now, most people are aware that the American healthcare system is among the most dysfunctional institutions imaginable, with the highest costs in the world, and some of the worst outcomes of any advanced country. That being said, there are still those who deny the necessity of completely overhauling the system, and as such, it is useful to take some time and go over the essential facts of the matter. As always, all sources will be listed at the end.

America’s Poor Health Outcomes

The USA ranks near the bottom of the developed world in most essential health outcomes. A 2020 paper from the American College of Physicians (published in the Annals of Internal Medicine) reports that “despite higher spending, the United States generally has less favorable outcomes than other countries.” Let’s take infant mortality, for example. According to a 2015 study from the National Bureau of Economic Research:

The United States has higher infant mortality than peer countries… The US disadvantage persists after adjusting for potential differential reporting of births near the threshold of viability.

The ACP paper confirms that America’s poor infant mortality ranking persists “even after adjustment for reporting differences.” According to the NBER, this subpar performance “is driven by poor birth outcomes among lower socioeconomic status individuals.” As if this wasn’t bad enough, maternal mortality is also shockingly high in the USA. According to an article from NPR (reporting on data from the CDC):

More American women are dying of pregnancy-related complications than any other developed country. Only in the U.S. has the rate of women who die been rising.

To make matters worse, there is evidence that the official statistics actually leave out a great number of deaths, meaning that the actual rate is probably much higher. According to an article from ProPublica, “the new rate, while capturing just how poorly the U.S. ranks among other countries, is actually a significant underestimate of the problem.” This only makes the issue even more horrifying.

In addition, healthcare-amenable mortality is generally higher in the United States than in peer countries. According to the American College of Physicians:

The United States has a higher mortality rate for medical conditions for which there are recognized health care interventions than Germany, the Netherlands, Japan, France, and Australia.

A 2017 study in the Lancet looked at global amendable mortality, finding that the United States ranked 35th in the world in overall performance. In a press release following the publication of the paper, Dr. Christopher Murray (the study’s lead author) said the following:

What we have found about health care access and quality is disturbing. Having a strong economy does not guarantee good health care. Having great medical technology doesn’t either. We know this because people are not getting the care that should be expected for diseases with established treatment. […] America’s ranking is an embarrassment, especially considering the US spends more than $9,000 per person on health care annually, more than any other country. Anyone with a stake in the current health care debate, including elected officials at the federal, state, and local levels, should take a look at where the US is falling short.

While many people acclaim the US health system for its advanced technology, it is clear that this does no good if people cannot actually access the care they need.

It is also useful to compare the United States with specific single-payer nations, in order to assess the differing effects of their healthcare systems. For example, a 2007 meta-analysis in the journal Open Medicine compared healthcare outcomes in the US and Canada, finding that “results for mortality favored Canada,” and that “studies suggest that health outcomes may be superior in patients cared for in Canada versus the United States, but differences are not consistent.” In other words, the Canadian system provides similar (and potentially better) outcomes compared to the US system, for far less cost (and with universal coverage to boot).

All-in-all, it clear that outcomes in the American healthcare system are extremely subpar, especially when one takes into account the ludicrously high cost. On that note, let’s discuss cost and expenditures.

Cost and Expenditures in the American Healthcare System

The United States spends more per-capita on healthcare than any other country on Earth. According to the aforementioned study from the American College of Physicians:

The United States spends far more per capita on health care than other wealthy countries, and spending is increasing at an unsustainable rate. […] The pricing of health care goods and services is substantially higher in the United States than in other developed nations. A 2003 analysis of OECD data showed that health care utilization in the United States did not exceed that of other countries, and price was the key driver of spending differences.

Much of this excessive cost is due to the enormous inefficiency and bureaucracy of the American system. There is a massive amount of administrative spending in the US, which is due primarily to the fragmented multi-payer nature of the healthcare system. According to the ACP:

In large part owing to its pluralistic financing system, the United States spends more on administration of health care than peer countries. One study estimated that in 2012, the United States spent $471 billion on billing and insurance-related costs — $375 billion (80%) more than in a “simplified financing system,” such as Canada’s single-payer model. Another study concluded that administrative costs were 31% of total U.S. health care expenditures, nearly double those of Canada.

These findings are validated by a study in the Journal of the American Medical Association, which said the following:

The fragmented financing system is one of the principal explanations for the high cost of medical care in the United States. A careful consolidation of financing into some form of single-payer system is probably the only feasible solution.

Another study from the same journal says the following:

The United States spent approximately twice as much as other high-income countries on medical care, yet utilization rates in the United States were largely similar to those in other nations. Prices of labor and goods, including pharmaceuticals, and administrative costs appeared to be the major drivers of the difference in overall cost between the United States and other high-income countries.

Similarly, a 2021 study from the RAND Corporation examined prescription drug prices in various countries, concluding that “U.S. prices were 256 percent of those in other countries.” They go on:

Prices remained substantially higher than prices in other countries — but with a smaller difference than in our main results — when we adjusted U.S. prices downward based on published estimates of the relative differences between manufacturer and net prices for drugs. U.S. prices for most subsets of drugs, and particularly brand-name originator drugs, were higher than those in comparison countries.

With all of this in mind, it is perhaps not surprising that medical expenses are a leading contributor to bankruptcies in the US. According to a 2019 study in the American Journal of Public Health:

The majority [of bankrupt people] (58.5%) “very much” or “somewhat” agreed that medical expenses contributed, and 44.3% cited illness-related work loss; 66.5% cited at least one of these two medical contributors — equivalent to about 530 000 medical bankruptcies annually.

Considering the subpar outcomes of the American healthcare system, these high expenditures are entirely unwarranted, and should be a source of national shame for the USA.

Access to Care and Lack of Insurance

To make matters worse, a large chunk of the American population is uninsured, and many are forced to go without the care that they need. According to the ACP:

The United States is the only wealthy industrialized nation without universal health coverage, a crucial component to ensuring quality health care for all without financial burden that causes delay or avoidance of necessary medical care… nearly 30 million remain uninsured, millions more are underinsured, and the number of uninsured persons is expected to grow.

The high rate of uninsured people is extremely troubling, especially seeing as a lack of insurance is associated with increased risk of mortality. A 2009 study in the American Journal of Public Health said the following on the matter:

Uninsurance is associated with mortality. […] Lack of health insurance is associated with as many as 44 789 deaths per year in the United States, more than those caused by kidney disease.

A 2017 study in the Annals of Internal Medicine validated these findings, saying:

The evidence strengthens confidence in the Institute of Medicine’s conclusion that health insurance saves lives: The odds of dying among the insured relative to the uninsured is 0.71 to 0.97.

The high costs of US medical care cause a great deal of financial strain for patients. According to a 2019 study in the Journal of General Internal Medicine (carried out by the American Cancer Society), “medical financial hardship is common among adults in the USA, with nearly 140 million adults reporting hardship in the past year. Among those aged 18–64 years, more than half report problems with medical bills or medical debt; stress or worry; or forgoing or delaying health care due to cost.” A 2019 Gallup poll found that 25% of Americans say that they or a family member have put off treatment for a “serious illness” in the past year because of cost, with a further 8% saying they or a family member has put off treatment for a “less serious illness” in the past year.

Overall, there is strong evidence that the United States’ lack of universal healthcare causes tens of thousands of deaths every year, and financial ruin for many more.

Single-Payer as the Solution to America’s Healthcare Problem

Of all the potential solutions put forward by politicians and activists, only one has any chance of actually solving the problem: the establishment of a universal, single-payer system. According to a 2020 study in the Lancet (conducted at Yale Medical School), a single-payer system would save an enormous amount of money and (more importantly) lives:

Taking into account both the costs of coverage expansion and the savings that would be achieved through the Medicare for All Act, we calculate that a single-payer, universal health-care system is likely to lead to a 13% savings in national health-care expenditure, equivalent to more than US $450 billion annually (based on the value of the US$ in 2017). […] Furthermore, we estimate that ensuring health-care access for all Americans would save more than 68 000 lives and 1.73 million life-years every year compared with the status quo.

Claims that a single-payer system would be unaffordable are entirely baseless, and contradicted by the overwhelming mass of evidence. A 2020 meta-analysis in PLOS Medicine found “a high degree of analytic consensus for the fiscal feasibility of a single-payer approach in the US.” As they put it:

There is near-consensus in these analyses that single-payer would reduce health expenditures while providing high-quality insurance to all US residents. To achieve net savings, single-payer plans rely on simplified billing and negotiated drug price reductions, as well as global budgets to control spending growth over time. Replacing private insurers with a public system is expected to achieve lower net healthcare costs.

With these findings in mind, it is clear that a single-payer system is the only way to solve the problems of the American healthcare system. In healthcare (as in so many other things), capitalism and market-forces can do nothing but harm.

Conclusion

All-in-all, it is clear that the American medical system is broken to the point where mild reforms cannot hope to fix the problems. The system as a whole must be scrapped; market-forces and private insurance must be removed entirely, and an entirely public, universal system must be established, based on a single-payer financing system. Only then can we hope to provide healthcare to all people free at the point of use, as is their right as human beings.

Sources

Writing on politics, economics, etc.