The real reason American health care is so expensive

I cannot tell you how obsessed I am with this chart. It shows exactly what is wrong with America’s conversation about health care. On one level, you’ve seen this chart before. It shows health care spending as a share of the economy of a bunch of countries. There’s Germany and France and Japan and Canada and oh! There’s America. But now I want to add something you haven’t seen to this chart. This is how much of that spending in each country is private and how much is public. Here’s what’s amazing: America’s government spending on health care on programs like Medicaid and Medicare and the VA – our versions of socialized medicine. It’s about the same size as these other countries. These countries where the government runs the whole health care system! And then there’s our private spending. It’s the private insurance system that makes health care in America so expensive. Conventional wisdom says that the government is more expensive than the private sector. “It can’t say no. It’s corrupt, it’s inefficient, it’s slow.” “If you want something done right you give it to the private sector.” That is what we hear in America all the time. And yet here we are with the biggest
private sector spending the most. If you look at the data on physician visits and hospital discharges, you can get rid of one theory. Americans don’t consume more health care than people in these other countries. We don’t go to the doctor more than the Germans or the Japanese. In fact we go to the doctor less. The difference between us and them is that we pay more. Every time we go to the doctor for everything from an angioplasty to a hip replacement from a c-section to a pain reliever. In America, the price for the same procedure at the same hospital, it varies enormously depending on who is footing the bill. The price for someone with public insurance like Medicare or Medicaid is often the lowest price. These groups he covers so many people that the government can demand lower
prices from hospitals and doctors and they get those lower prices. If the doctors and hospitals say ‘No’ they lose a ton of business. They lose all those people on Medicare all those people on Medicaid. But there are hundreds of private insurance companies And they each cover far fewer people than a Medicare or a Medicaid. And each one has to negotiate prices and hospitals and doctors are on their own. And if you’re uninsured, you have even less leverage. Nobody is negotiating on your behalf. So you end up paying the highest price. One study found that most hospitals charge uninsured patients four times as much as Medicare patients for an ER visit. Other countries, they don’t have this problem. Instead of every private insurance company negotiating with every healthcare provider. There’s just this big list. The country, the central government, they go and they say, “If you want to sell to us, to all of our people, then here’s what you can charge for a checkup. Here is what you can charge for an MRI or a prescription for Lipitor. And so then whether that bill goes to the heavily regulated private insurance companies in Germany or directly to the government like in the UK. Each country is telling the doctor or hospital or drug company how much that bill will be. And because the government controls access to all of the customers. It’s an offer that hospitals and doctors and pharmaceutical companies typically can’t refuse. “I’m going to make him an offer he can’t refuse.” In America the idea is that you’ll be a consumer. That you’ll do what you do when you go to
Best Buy and buy a television. But that just doesn’t work in healthcare. It doesn’t work in healthcare because you often come and get health care when you’re unconscious, in an ambulance, when you’re scared, when it’s for your spouse or your child It is a time when you have the least bargaining power. You are not usually capable of saying, ‘No.’ You’re not knowledgeable enough to do it, you’re not comfortable doing it, or you’re not conscious enough to do it. That’s why in other countries the government is a person who can say ‘No’ for you. You can say, ‘No, that’s too expensive you’re going to have to lower your price’ because they do have that power. Anchor: A new push for single-payer health care right here in the US. Demonstrator: What do we want? Crowd: Single-payer! Demonstrator: When do we want it? Crowd: Now! Anchor: California and others are saying maybe we should adopt the European model. Klein: If we decided to create a single-payer system with one of these huge price lists in the US There would be nothing to stop lobbying from hospitals from doctors from drug companies. And those prices would get influenced. So we could end up with a single-payer system that is expensive. Even as expensive as our current system. It all depends on how much you negotiate down the prices and now in America these groups have so much power
because they are so rich. That it’s really hard to get them to bring down the prices. This is the irony of American healthcare: It’s so expensive that it’s become
hard to make it cheaper. All that money they make, that becomes political power. And years and years and years of overpaying – those are huge industries now. And they have a lot of influence in Congress. Under a single-payer system if we did drive prices down, doctors and hospitals they would be paid less than they are right now. That might mean some of them close or some go out of business or some move. It would be really painful. One person’s waste is another person’s essential service or local hospital or their income. But then single-payer it’s not an all-or-nothing choice. For instance, there’s a really interesting section of Bernie Sanders Medicare-for-all bill. Where he lays out this interim plan. It’s a plan he wants while he’s setting up his new single-payer system. And in that plan, he expands Medicare to cover vision and dental. And he opens it to nearly everyone. Not just people 65 and older. All kids go on Medicare automatically and most adults can buy in. That plan, on its own, it wouldn’t get American health care spending far down overnight. But it would at least begin to recognize what we already know and what most other countries already do: That health care is one of those things the government can do cheaper and better than the private sector.

100 Replies to “The real reason American health care is so expensive”

  1. Why private insurance so expensive? You are subjected to Co-Pay, Coinsurance and Deductible. Imagine you need to speend $1-3k before insurance pays for you. And if you are lazy enough that you did not pay attention on insurance asking for additional information once you are discharge, well you are ending paying 3k atmost for observation room and 2 IVs

  2. Just call a veterinarian for your health care needs.
    Medical physicians only learn one species. Veterinarians learn to treat multiple species.
    The prices are lower because they're dependent on price sensitivity of the marketplace.
    Veterinarians are more reasonable about your quality of life outcomes.
    There are veterinary specialists. Need an MRI? Done. Joint replacement? Done. Oncologist? Yep, available. Physical therapy? Done. It's all there. Vet care costs can add up, but the prices in the USA are not as artificially inflated as you find in human medicine, and the outcomes for pets seem pretty good given that they're living far beyond average life spans.

    I've had to do all sorts of diagnostic/surgical work on horses and dogs. So I've been there, done that which is why I think I'd rather just go to a veterinarian for my healthcare too. It's less fuss and less paperwork.

    If that's not an option, fly yourself anywhere around the world for healthcare you need. Medical Tourism is a big thing now. If business can outsource abroad to find a good price, so can you.

  3. Private anything in US has has no desire to contain cost. NOW zombie like Infinite growth in a finite world is baked into our flailing democracy

  4. 3:28 and if the US had that power our government is SO corrupt and greedy it would be even worse if they controlled the prices… yes the government COULD do it cheaper and better then the private sector. But they won't cause people actually care about that part of politics and our government would have big problems with millions of angry Americans after they take over and charge 12 grand to get a cavity filled.

  5. If we lose the private sector of healthcare… a bunch of hospitals and clinics will close their doors… good luck with that.

  6. 0:50 conventional wisdom? really? it isn't conventional wisdom it is right wing ideology always meant to protect the status quo, the elites, hence they are called conservatives_. It is a myth propagated by a group of _pseudo-scientists called rationalist economist they make up an idealist model called the free market with idealist model of fictitious people, that makes perfect use of reason and they have perfect information. An Idealist model where they run mental experiments (brain farts really), where they can't find any contradiction among their assumptions, so they make the wrong conclusion that "it works, it just works"

    In real science when scientist make a model, they have to compare that model with reality, and see if the results produced by the model are the results of reality, but when rationalists economists have never done anything of this, they assume the model is correct and that they have to change reality to fit their model, which is the complete backwards way around, the model has to be changed to fit reality.

    The thing is, just because a model in simulations or mental experiments works doesn't mean it will work in reality, it only means those mental experiments and specific simulations didn't showed internal contradictions, but it doesn't even guarantee there isn't any internal contradictions, and in no way shape or form begins to cover the external contradictions between reality and the model that is been tried.

    The only reason they keep saying "government is more expensive" is because they assume the only way to reduce prize is competition in the market among businesses driven by the profit motif, the problem is that is all nonsense. Because the government can reduce prizes by economies of scale and also the government can invite people to participate in competition of ideas and even making money by developing better solutions but keeping everything under government control.

  7. The US healthcare system has three levels. 1) Patients who are wealthy enough to pay for their own treatment. 2) Patients who are wealthy enough to carry a reasonable level of insurance. 3) Poor patients. These are plied with painkillers until their ailment kills them off.

  8. ATTENTION!!! So u wanna get rid of the FREE market i never thought people would fight to be oppressed y'all know that chart takes in the overall spending right like the spending to develop new drugs and working on cancer and all of the science of healthcare not just this is what u pay at the hospital go read it CDC website

  9. The Health industry in US is a biz without "real" competition, ergo No Free Market, no Capitalism. Is just a milking cow machine and you are the cows. Everyone get sick at some point and need to pay, the higher, the better.

    And the most disgusting practice: using Public money for R&D and then making the profits going Private. Your taxes used for Private companies benefit.

    For a country that hate so much anything related to social things, they surely like to use Social Capital for private gains.

  10. Just let each state handle it
    Stop trying to run things from the top down. Stop comparing the United States to European nations.

  11. And now they (Americans) are stealing (not literally, like buying alot) Canadian medicine because we're cheaper. We Canadian citizens are living with shortages of medical drugs.

  12. After so many years of hardworking, the lawyers and doctors in the US finally opened the Pandora’s box. And now they are getting what they wish for.

  13. I’ ve never been so proud of being Argentinian, we might be in a horrifying economic crisis but we still have public healthcare. Even though it doesn’t work perfectly, if you’re sick or you have an accident someone is going to take care of you in the ER for free.

  14. I had no idea. I feel like the American people think the only solution is fully givernment funded healthcare-clearly that's not the only way to handle this. The government should just regulate health care costs so that insurance companies can't negotiate anything. It should be a fixed rate-no hospital needs a profit margin that high, and if they do, that's when the gov should step in and help. Honestly if insurance was fair, less people would need to be on medicaid and the government would keep more money overall.

  15. If only we could produce the supply of doctors to meet the demand once a one insurance for all is passed. I can speculate possible a decade until that supply is met if the mandate isn't reversed due to all the potential doctors giving up covering down on all the patients.

  16. I had pneumonia and i stayed in a hong kong public hospital for a week. Only costs me about 300 hkd, which is the equivalent of about 40 usd.

  17. The US system is built on greed and poilitical movement is only measured on how much it benefits THEMSELVES financially, as in theay don't want to pay money through tax instead of credit card (which would make the total amount of costs much less because they don't wan't to pay anything at all..
    Hence, if they can't have it their way, they cry socialist.

  18. Have you seen the way the VA operates? It’s a joke. I plan on going into the Medical Field. If we start utilizing singe-payer healthcare, I’m dipping. There is no point in studying for that long and passing many test to get paid way less.

  19. Mass shootings, Obesity, STDS, fast food addiction, low i.qs, massive divorce rate, overreachimgmilitary and police United States should turn it diwn a bit and fix its own problems

  20. This video is so left-wing, that all the time U.S. appeared on the screen…it was on the left.

    Freud would be glad!

  21. Does anyone know the source of the survey he mentions at 2:19? I'm doing a research project on this topic and was hoping to use a data set to reference?

  22. It’s not american tho,it’s UNITED STATES,american includes
    And latinos🤷🏻‍♂️🤷🏻‍♂️🤷🏻‍♂️
    America it’s a continent not a country👍🏼

  23. Good video, thank you. I have a couple of honest questions to ask. Before I get to them, I agree that the power of lobbying groups is absolutely detrimental to individual people and their freedom in the US. Elections in the US is an opiate to the masses to convince Americans that they matter. Until either lobbying rules change, and/or the number of "representatives" is increased such that the number of people they represent is small enough to actually make a difference, the status quo is where it's at. That said, remember that lobbying only works if there is the flip side to the relationship. Politicians and bureaucrats have to be party to the lobby game for it to work.

    On to my questions (with some commentary). First, I grew up in Canada, and used the health care system in three provinces: Ontario, Manitoba and Alberta. When statistics are used such as were in this video, I never see the qualitative comparisons between countries. At least between Canada and the US, the delivery of health care is not apples to apples. Hip replacement was an example used in the video. When I worked at a college in Manitoba, there were three employees who needed hip replacement surgery. Each had been trying different options before surgery, in order to avoid surgery. Once the doctor finally concluded that surgery was the only way, it was at least 6 months on the waiting list to get in. Health care delivery costs less when the single-payer system dictates a price that is too low, it's not worth it for people to get in on the delivery side, and you have massive backlogs.

    Second question: Do you think that part of the higher cost for services and drugs is because that most of the R&D is done by US companies in the US? Put a different way, do you think that higher costs in the US subsidize health care in the rest of the world? Growing up in Canada, there is not much evidence of a strong entrepreneurial spirit. There aren't many industry-changing innovations that come from Canada. From a health care standpoint, most of what is offered in Canada came via the US. I don't know if or how much this is true for other countries that are compared with the US. My assumption is that maybe Japan and Germany on the hardware side. If that equation changes, costs might fall in the US, but will that cause costs to rise in other countries? If so, do we care?

    One of the most eye-opening parts of the video was the comment that at the time of needing the expensive services, patients are not in a position to negotiate costs. That said, if I go to the ER, with a gaping wound or some internal pain, there is no way for someone to give you an idea of how much it costs until they run some tests. For me the biggest disappointment of the ACA law was that it didn't divorce health insurance from employment.

  24. Universal greed is the total problem. The tragic American paranoia over social programs kills them. Americans are far too selfish to think of a social program. They can't understand the concept of I am healthy but will pay a small amount because they have been taught to be selfish. If you pay a tiny amount now all those small payments add up and if you become in need then you can be helped. American society is built on greed and that is their flaw.

  25. There will be a tipping point when all those guns are turned inwards..the second amendment was made for that..the right to fight against domestic government .

  26. "It is so expensive, it is hard to make it cheaper." Great point about majority of people using healthcare when they are uncomfortable.

  27. Sry guys, but where exactly is "Protugal" ? 😉
    I think you messed that up in the first graphic…. but still a nice vid like always!

  28. The main issue is the medical and pharmaceutical business is run for profit. It shouldn’t be. Any and all profits should only be rounded back into better practices and medication as a perpetual cycle of bettering human health.

  29. Do American doctors swear by the "Hippocratic Oath"? If they do, isn't it then logical to conclude that one becomes a doctor to help all people in healing and prolonged life….rather than becoming a doctor only to profit exuberantly? If they don't follow this oath, then people and mostly american people should realized that any version of US healthcare is only a business whose main point is to make money and nothing else.

  30. It's expensive cause there's very little free market competition, it's a cartel – too much regulations, IP laws… favoring some others over the rest

  31. Health care in America. Sure we've got thousands of hospitals
    An army of doctors and surgeons.
    Legions of assistants and nurses.
    Just no health care. We had one
    President that tried to fix this mess. And now, God help us.

  32. So glib, so simple. GIve it to the government and let them manage it. They've done such an outstanding job on the war on poverty, education, and yes, even Medicare, which is perpetually on the verge of being broke (Part A) and requires ever-escalating taxes to stay afloat. The problem isn't just private insurance–it's third party payment of any sort. The more insulated patients are from cost, the more prices will rise, AND the higher the demand for treatment. If you don't care because you don't pay, well….up the prices go. And pretending that slashing payment won't affect access is naive. When Canada and the UK run out of money for healthcare in any given fiscal year, which they frequently do, they stop doing high-end elective surgeries. So forget about getting your mobility restored because your hip is in constant pain and you can't work. You can just deal with it until the budget resets. Also keep in mind that the US subsidizes foreign healthcare systems by selling American-designed medical devices and pharmaceuticals to them at a fraction of what they sell them for in the U.S. So, yeah, our drugs are more expensive because Europe's drugs are so much less expensive. Same with medical devices. If all rates were Medicare rates, you'd see an instant closing of of hospitals and physicians retiring. Maybe we need that type of disruption….inefficient doctors and hospitals should go out of business. But let's start with the problem: third-party payers. I hate 4-minute videos that explain away complex topics like healthcare spending. You have the right idea, but these cursory treatments do more harm than good because they paper over the consequences.

  33. I live in India.
    We get appointments, checkups and even medicine free of cost.
    You can walk in and out treated free for small ails like fever and stuff.

    If you’re rich, you can go to a private hospital but, the doctors in government hospitals are better.

  34. Unmentioned 800 lb hippo in the room. The reason why America does not have an advanced single payer or advanced multi-payer health care system like the Germans or the Swiss is because a large number of the white population does not want to pay for healthcare that will benefit people of color. Ditto for higher education, nutrition (Food Stamps), housing (section 8), etc. All the before mentioned preserve and enhance life and a large segment of the white collective does not favor that especially in times when the white population is in demographic decline (fewer births and greater deaths). Is what it is but with the law of karma you not only reap what you sow, you reap greater than what you sow and later than what your sow. Rip up the social safety net and it won't be there for you when you need it. Everyone is a death, divorce, illness, injury and layoff away from poverty (and ill health). Don't wish ill on anyone but this element made its bed and has to sleep in it. A good series on healthcare on YouTube is Healthcare Triage. Gets into health issues and compares the American healthcare (sick care) system with a handful of other nations (Germany, France, UK, Taiwan, Canada). Recommend.

  35. Hey, anyone remember the time BEFORE the government got involved with healthcare and doctors where plenty, and had to compete? You know, that same point where even the poorest man could afford any treatment? No? Oh well, not like you care about healthcare… Oh wait.

  36. The greatest advance in health care will happen when most people go into Prevention.  
    In China 1/3 of the people use liquid colloidal minerals to prevent disease, 
    eat mainly vegetables to prevent cancer, 
    use Quigong exercises to prevent many diseases, like arthritis, etc.

    Ask not what the government can do for you. – JFK.

    Please join the Friday Students Strike for the climate Emergency.
    SF City Hall noon.
    Youtube: paul8kangas

  37. I live in Australia. Earlier this year I got so depressed I stopped eating and had to be hospitalised. If that had I bankrupted my family that would have broke me. Vote for Andrew yang America.

  38. This is really something else. I hate how the health care system is. I am about to pull my hair out dealing with insurance companies!! The government owns everything, and we get nothing. Health insurance bills raise to the top. I hate it

  39. How the heck can hospitals just decide to charge someone a different price?? Whether you have insurance or not the cost of preforming a procedure should be the same. It’s not like the actual cost of putting on cast changes based on who it is.

  40. Because big pharmaceutical mafia and doctors unions … they are highly paid average $250,000 , no other civilized nation would let them get away with that money, nowhere in this world and shortly capitalism greedy transformed the rights of a person into a profitable scam business where insurance in top of doctors ridiculous salaries , not to mention people are loosing trust in doctors those days. It’s a mafia that won’t allow easily doctors from other parts of the world integrate and be accepted in to USA or into the union gang. Because of medical school profits .. everything is linked and one purpose to get rich and keep the status. This industry that should help people transformed into a mafia. For USA this cause it’s lost.. people are too into anti depressive and drugs and they are not capable of a social revolution. Good luck.

  41. The idea that the free market aspect of American healthcare is what drives costs could not possibly be farther from the truth. The aspect that drives up costs in every industry is the government because it removes competitive pricing. When a good or service exists in the private sector, companies are able to compete against each other which inherently increases quality and reduces costs. This is the same reason why college costs skyrocketed after the introduction of guaranteed government-backed student loans. When companies are given direct deals with the government , costs always go up and will continue to go up indefinitely. A great example would be the fact that the average public school runs on three times the cost per student as a comparable private school. Nationalizing healthcare might be a quick way to reduce the costs to the consumer, but would undoubtedly cause costs to increase to even more. The sad part is that publications like Vox and politicians like Bernie Sanders are completely aware of this, but fight to nationalize industries like healthcare simply because of the profits nationalization would provide corporations.

  42. The real culprit here is everyone "negotiating" prices. Why don't the government just require hospitals to post their prices REGARDLESS of insurance? Not even a universal medicare will make it cheaper if prices remain not transparent.

    Also, it should be mandated to healthcare professionals to consider the patients ability to pay especially when telling them they "need" that surgery but in reality, it is more of an elective!

    US healthcare practitioners are so cookie cutter, there is so much waste.

  43. It is expensive, at least partly, because of liberal mandates that require treatment of illegal aliens and those costs get passed on to others.

  44. I am not an expert, but after studying about the American healthcare from this video, I can not say anything because at the beginning I said "I am not an expert"

  45. "Conventional wisdom says 'the government is more expensive than the private sector'"? When you hear a "truth" a thousand times but you never see the proof it is not "conventional wisdom" it is ideology.

  46. What he doesn’t tell you is that if your “uninsured” means discounts at hospitals if you are willing to make the payment plans and it’s very much cheaper than anything else .80k for full dental implants. 5 dollar prescriptions, universal also means the government and the hospitals can decide whether your worth the time and money to

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