The Real Reason Healthcare Is So Expensive


Why is it that citizens in the richest country
on Earth are charged so much money for not dying that many go broke and even end up living
on the streets? Let’s take a look at the history and the travesty
of American healthcare, and the reasons it costs so much. In a 2017 article for Stanford Medicine, the
editor-in-chief of Kaiser Health News, Elisabeth Rosenthal, MD, writes: “The very idea of health insurance is in some
ways the original sin that catalyzed the evolution of today’s medical-industrial complex.” Perhaps the earliest version of that system
dates back to the 1890s, when lumber companies in Tacoma, Washington paid a pair of doctors
50 cents monthly to treat employees. In the early 1900s, the Baptist Church at
Baylor University Medical Center in Texas inadvertently invented modern health insurance. It began with a 14-room mansion dubbed the
Texas Baptist Memorial Sanitarium. When attorney and Baylor vice president Justin
Ford Kimball discovered the sanitarium had racked up unpaid bills, he struck a deal with
teachers who would pay 50 cents a month, plus a deductible, for the right to a 21-day stay. Baylor’s system caught on like a cold, and
World War II helped cement the ill-fated system. Employee numbers dwindled during the war,
so companies offered health insurance to lure new hires. The federal government further incentivized
the practice by making employer expenditures for health employee healthcare tax-exempt. This arrangement wasn’t meant to lower overall
medical costs but to blunt the impact of catastrophic events. In the 1950s and ’60s the popularity of health
insurance skyrocketed, and profit-hungry companies sprang up to capitalize on demand. As recounted in the Stanford Medicine article,
“Insurance policy: How an industry shifted from protecting patients to seeking profit,”
in the 1950s, for-profit insurance providers like Aetna and Cigna started charging different
rates based on age and trying to attract younger, healthier customers. Such companies also forged closer connections
to the business world. This created a conundrum for competitors Blue
Cross and Blue Shield, which had committed themselves to, quote, “providing high-quality,
affordable health care for all.” Left to care for the sickest patients, the
financially ailing Blue Cross and Blue Shield switched to for-profit status in 1994, effectively
killing off what Rosenthal calls, quote, “old-fashioned noble-minded health insurance.” In that same year, an informal survey by the
Senate Judiciary Committee discovered that half of the largest U.S. insurers treated
people who had suffered from domestic violence as having pre-existing conditions, affecting
their costs and ability to get insurance at all. Subsequent surveys by insurance commissioners
in Kansas and Pennsylvania indicated that a quarter of insurance companies looked at
domestic violence when weighing whether to renew insurance policies. Companies even penalized women for having
children. According to Politifact, in 2009, 39 states
permitted insurers to deny coverage for, quote, “virtually any reason.” Pregnancy, quote, “almost always” counted
as a potentially disqualifying pre-existing condition. “Uhh! Gimme the fast drip. I need the hydration.” The 2010 Affordable Care Act (ACA), commonly
referred to as Obamacare, aimed to make health coverage more comprehensive, cheaper for people
who already had insurance, and accessible to citizens who were previously barred by
pre-existing conditions. However, the results have been mixed. While the ACA’s Medicaid expansion provided
vital help to people without coverage, people insured through their employers have been
increasingly crushed by soaring deductibles. In 2015, physician Praveen Arla told USA Today
that the state of healthcare, quote, “flip-flopped” from what it was before the ACA. According to Arla, patients with employer-based
insurance would often lament, “‘My deductible is so high. I’m trying to come to the doctor as little
as possible.” Meanwhile employers have increasingly gravitated
toward high-deductible insurance plans as a cost-cutting measure. Citing the Centers for Disease Control and
Prevention, CBS reported in 2019 that four in 10 Americans have high-deductible plans. Assuming patients don’t eschew healthcare
altogether, the basic alternative would entail paying a lower deductible with a prohibitively
high monthly premium. Either way the fees for procedures and medications
can be outrageous. “One in every three Americans goes without
healthcare coverage at some point.” Much to the dismay of many patients, hospitals
have a longstanding tradition of adding massive, unexpected fees to medical bills. In 2013, author, attorney, and Court TV founder
Steven Brill painted a bleak picture of the predicament. Writing for Time, Brill describes how hospitals
rely on an internal system called the “chargemaster” to assign prices for procedures, drugs, medical
equipment, and miscellaneous items. Some charges might seem arbitrary, with hospitals
billing patients for lamp shades and IV tubing. Adding insult to literal injury, those fees
are severely inflated. Brill observed that a blood test that cost
$13.94 through Medicare was assigned price tags of $199.50 and $239 respectively to two
separate patients. According to a Rand Corporation report from
2019, the world collectively spends around $1 trillion on drugs annually. The United States accounts for about half
of that total despite making up only five percent of the global population. Three percent of America’s entire GDP comes
from drug costs. But while the prices patients pay far outpace
the rest of the world, the results lag behind other developed nations. The Harvard Gazette says that in 2016, the
U.S. spent twice as much on healthcare as other high-income countries, but ranked dead-last
in life expectancy on a list of 10 other countries. Why does America pay so much more for less? The Rand Corporation observes that, “every other country in the world regulates
drug prices, typically through some formal process of negotiation. Only we don’t.” Instead, pharmaceutical companies call the
shots. The FDA effectively allows them to monopolize
drugs via patents. And because greed is bottomless, drug companies
boost their bottom lines by exploiting legal loopholes. As USA Today details, drug patents generally
last 20 years. Once you subtract the time it takes for approval,
pharmaceutical manufacturers can, quote, “expect anywhere from seven to 12 years of protection.” However, they can extend that time through
the dubious practices of “evergreening” and “thickening.” Thickening entails inundating the courts and
Patent Trade Office with applications in order to overwhelm the system. Evergreening involves adding small changes
to a drug, even doing nothing more than adding a stripe to a pill. Forbes policy editor Avik Roy explains that
drive-by doctoring occurs when a doctor outside your insurance network treats you without
your knowledge, which can result in extraordinary out-of-pocket fees. Roy writes that drive-by doctoring, quote,
“is especially egregious in emergency rooms” due to the “free rein” afforded to physicians
and the often disoriented or outright incapacitated state of patients. No wonder the healthcare system is such a
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28 Comments

  1. 1st

  2. Prepended

  3. Pee3eeeepee

  4. Free in Denmark 👍

  5. Me:
    laughs in finland

  6. It's free in Britain too

  7. Not debtly expensive in the UK 🇬🇧!

  8. cool video my guy

  9. great video keep up the great content

  10. Socialized medicine is worse.

  11. The health insurance industry is mostly to blame. They are unnecessary and they need to be rendered OBSOLETE

  12. It's VERY cheap where I live .

  13. Because AMERICA became a Corporation in 1871. America is no longer a Country since then.

  14. Wow. I just found you channel and I'm hooked. Very in depth and well thought out explanation. Super excited to watch more

  15. Greed!

  16. All these Europeans on here saying "It's free here" no simpletons it's not free they tax the hell outta you to pay for it so no it's not free nothing is free.

  17. The fee-for-service payment method needs to change to an outcome-based system. As it is now, bad doctors are paid the same amount as good doctors. Hospitals charge outrageous amounts for an aspirin because they can. If providers are paid by positive patient outcome vs. for each service they check off on the forms not only would costs go down but overall healthcare would improve. And for those who have government single-payer health care…nothing is free. You're paying for it through taxes and reduced income. Oh yeah…the U.S. is paying for your reduced pricing on pharmaceuticals. The only reason your governments can control drug prices is because pharmaceutical companies make up for the loss by overcharging us in the U.S.

  18. But Obama care was a LIE!! People would pay more and receive less care…

  19. Very interesting truths.

  20. Health insurance invented in the early 1900s in the US? What?! The first health insurances in Prussia were founded in 1845 and 1848. Just saying…

  21. Its to 95% free in germany

  22. Do you think we'll ever find a good way to give everyone in America affordable, quality health care?

  23. *Laughs in British*

  24. #PeopleOverProfits
    #ShelteringInPlace

    #HerdImmunity

    #UBI

    #UniversalBasicIncome

    #SocialDistancing

    #Coronavirus

    #Covid19

    #Pandemic

    #IamNotAVirus

    #SelfIsolation

    #SelfQuarantine

    #tRUMPisanIdiotAndPsychoPenceToo

    #WashYourDamnHandsCoverYourCoughsAndSneezes

    #pervBiden will NOT win against #tRUMP, No #Dem will, except #BernieOnly.

  25. Top secret answer: greed

  26. 😲The brainwashed America society never wonder it's the America failed water system being poisoned with fluoride and medications also our food source been poisoned with pesticides,GMO also herbicides/THAT'S why America's healthcare system is so expensive🤔

  27. Obamacare was written by insurance companies. It’s an unaffordable callous system meant to bankrupt and kill the patient.

  28. Because the medical system is geared to make as much money as possible and in doing so screw the sick with overwhelming medical bills

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