High costs of health care in the USA

 One of the biggest problems the United States healthcare system struggles with is high cost. This issue contributes to reduced access to care which lead to negative consequences such as increased health debt and poorer patient outcomes. 

Rising healthcare costs creates a burden on patients by making necessary care unaffordable. This leads to delayed treatment, skipped appointments, medical debt, and patients not getting necessary prescriptions due to the cost. If patients are not able to afford healthcare this can lead to worsened chronic conditions and overall poorer health outcomes. Unaffordable healthcare can also force patients to accumulate debt through credit cards, personal loans, or high deductible plans to pay for medical care.

Woo, a young man, who used to live in a run-down apartment in Milwaukee stepped on a nail and refused to get medical help because he couldn’t afford it, according to Matthew Desmond (2024, p. 15). After a few weeks, Woo eventually had to visit the hospital. His foot and leg had a severe infection causing him to get his leg amputated (Desmond, 2024, p. 30). This story is an example of how people may put off treatment due to the cost of care, which can result in chronic conditions and overall poorer health outcomes. 

I believe that in order to improve people’s financial stability, healthcare cost should be reduced. By doing this, people will be able to reduce medical debt and allow individuals and families to afford other necessities. This will also improve public health outcomes by encouraging preventive care and early interventions, resulting in better health for the population.

Reference

Desmond, M. (2024). Poverty, by America. Penguin Random House LLC.

Americans spend about $5 trillion on healthcare.  Or, maybe that figure is up to $5.5 or $6 trillion by now.  That's about 18% of our Gross Domestic Product. 
Presumably, a national health care plan, whether covered by a single payer or whether using multiple different payers (see the German or Swiss systems for examples) would cover something slightly under 100% of costs: possibly 95% of healthcare costs.  And, presumably, there would be increased efficiencies in health care, and that would reduce costs even more, so the cost of a national health care program that covered everyone would presumably be about $5 trillion if we are currently spending nearly $6 trillion on healthcare. With 340 million Americans, that works out to about $14,700 in payments that would be needed for each person in the United States.  So, for a family of four, if the costs of all health care was spread evenly, that family would need to pay $58,800 in taxes to cover their share of health care costs.  That is the average amount each four-person household would need to contribute to a public program that covers nearly all health care for everyone. 

But of course, a health care scheme like this would not distribute costs evenly.  We already cover about 43% of health care spending through Medicare, Medicaid, and the Veteran's Administration. We would only need to raise about another 47% of total healthcare spending if we wanted a universal health care system.  So, taxes would have to gather another $2.9 trillion from the population. 

The 57% of us who receive health insurance through our employers would get a huge windfall (or our employers would), because employers would no longer have to pay for private insurance for their employees, allowing them to pass on what they now pay to cover health care benefits on to their employees as income.  The increased income from health insurance policies our employers are purchasing on our behalf would, for most of us, closely match the required increase in taxes to get federal revenue up by $2.9 trillion. The average health care benefit per employee is about $8,000, and about $19,000 for family plans.  So, with a universal public health care scheme, incomes for the 57% of us now enjoying plans paid for by our employers would increase to mostly offset the increases we would need to pay in taxes. Currently, wealthy Americans (those in the top quintile) pay about 24% to 27% of their earnings in federal and withholding (Social Security and Medicare) taxes.  If those went up to 33% to 40%, this would go far toward raising the $2.9 trillion.  Middle class households are paying about 19% to 24% of their incomes in federal and withholding taxes.  For them, if those tax rates went up to 28% to 33%, this would be enough to cover the universal health care program.  The increases in income from employers passing on as salary the money that had been used to purchase their healthcare would probably cover most or all of the cost of their increased taxes, so that their after-tax consumption levels would be essentially unchanged.  

Insurance & Substance Abuse

When this assignment was first introduced, I began to overthink it. What would I choose to write about that I could just talk about for an hour without having to overthink what I am writing about and making sure I spend the proper time limit on it? The more I got to thinking, the more what I do every day came to my mind. 

I work at Gateway Foundation Drug and Alcohol Treatment Center here in Springfield, IL, and the way that insurance companies control everything that clients can do really grinds my gears. Clients come to us for help, and sometimes we must turn them away because of insurance. There are times when clients come in and they are ready to turn their life around and do better for themselves, and there are other times when clients come in because they are being forced to by legal or DCFS. There are sometimes times when they come in and we have to say “no” because their insurance won’t cover Gateway and as we are out-of-network they can’t afford to pay the out-of-network costs. 

An example that I can use about insurance dictating what clients can do that I don’t agree with happened a few months ago. Even though weed is legal in Illinois now, in some counties it is still illegal, or in some counties probation departments don’t allow it to be in the person’s system. There have been a few clients who come in and the only substance that they struggle with and want treatment for is weed. Insurance companies will approve treatment for it in the outpatient setting, but they will not approve it for the inpatient or residential treatment setting. If someone is only coming to outpatient, they leave and go back everyday to the same environment every day that could maybe be contributing to them using. They also could be going and hanging out with the same people who are encouraging them to smoke. There were a few certain people who wanted to go to residential treatment to get away from these factors. Residential has many factors that can be beneficial to the client to help them. Being away from weed for 28 days or however many days insurance will approve the stay, could be life changing for a client, but insurance companies, especially state funded Medicaid plans, don’t see weed as being a substance that treatment is needed for. Some private insurance companies will pay for it, but it is tricky to get it done. 

We also have the instances where after so many weeks and hours of being in treatment at a certain level of care, they have to be transitioned to a lower level of care, or they have to be completed from the program if they are already at the lowest level of care. Clients know themselves and they know their boundaries, and when we must tell them that by this day of the month they have to go to a lower level of care, or this day of the month they have to complete the program. When you tell clients this and they aren’t ready to be at a lower level of care or complete, you can almost see the light drain from their eyes. A lot of the time, clients use their drug of choice to be rotated to a higher level of care or be able to stay in the program longer to get around insurance and what they dictate.

I don’t believe any of this is right and I hate how much insurance dictates everything in our lives and how expensive it is. I hope one day we have a world where insurance doesn’t have such a significant impact on everything, and if the day comes I hope I am here to see it. 

Thank you for sharing these insights into some of the barriers that diminish the quality of care available to persons who are trying to recover from substance use disorders. Insurance is supposed to play a useful role in a couple ways.  First, it offers pooled risk.  If 90% of us will never need treatment for a problem, but 10% of us will need treatment, and we can figure what the average cost of that treatment would be, we can spread out the risk by having 100% of us paying a fraction of the average cost of treatment so that if we ever need the help, the money will be there for us.  That's pooled risk, and it can be done by private insurance or by taxing people and having a public program to provide services.  Also, insurance companies (or administrators of public programs) should be reviewing treatment plans and interventions, and keeping an eye on providers, to guard against providers charging too much, or charging for providing ineffective treatments.  But, this needs to be done at an aggregate level.  There are always outliers, extreme cases, and exceptions, and so long as the rate of these sorts of cases isn't much higher or lower at a provider, the insuring (and paying) entity ought to just defer to the wishes of professionals and clients.  Only if a particular provider seems to be frequently having exceptionally costly or long-term treatments should the insurer come in and start examining each case and determine what is going on.  

I wish we also had a way to help relocate people to healthier environments, since so much about substance use disorders is conditioned by the social environment in which a person lives.  

Insurance companies are widely loathed, and there are many egregious examples of insurers denying treatments to their subscribers or payments to the providers. The 2010 Affordable Care Act put some restraints on how private insurers provide coverage, but abuses and outrages continue, as you illustrate in your reaction essay.