With it being
Cover the Uninsured Week, this topic seems timely. It is difficult to argue that healthcare isn't one of the United States' most troubled systems. It's driven by the theory that privatized systems are always more efficient. That, of course, is true if you measure efficiency by profitability. Unfortunately, business theory also supports the idea that not all customers are profitable. So, one should only serve customers who are in fact profitable. This, of course, leaves many citizens without healthcare.
There are a number of issues that demand reform. First off, the pharmaceutical industry takes advantage of this country's system. During a three month co-op years back, I spent time working at a pharma firm. It's a European firm, with its most advanced drugs in Europe, and the majority of its profits coming from the United States. Anytime there was a revenue shortfall, they'd hike a simple extended relief drug (that couldn't be copied due to stability issues) 15%. Consequently, insurance companies were paying almost $200 for the convenience of their patients taking the cough drug twice a day. This isn't atypical.
Then, of course, you have the issue of insurance and hospitals. These are often for-profit businesses. Consequently, the markup is significant. Even worse, insurance companies get "quantity discounts" for purchasing healthcare. So, they literally pay a fraction of what an uninsured person would pay. Generally, a quantity discount assumes some sort of added convenience thanks to economies of scale coming into play. Needless to say, the same logic can't work for healthcare. Insurance companies can't preschedule people or allow for greater mass production to lower hospital costs.
So, what this means is that any citizens who happen to fall on bad times by perhaps losing a job will have to pay significantly more for already overpriced healthcare. In fact, a recent
USA Today article indicates healthcare pushes around 1 million people into bankruptcy per year. The U.S. spends a greater percent of its gross domestic product on healthcare, while insuring a modest percentage of citizens. With costs spiraling, companies often reduce their plans or see lower profits. This actually makes many European nations more affordable for businesses. Not only does this hurt the nation's people, it hurts the nation's economy also.
The irony is, we have a system that discourages preventive care. If you get issues taken care of early, it prevents a major (and costly) problem down the line. However, the uninsured can't afford to resolve issues early, and later get rushed to the hospital and pinned with a $70,000 bill. Then, they get chased by collectors, although in the end, many simply can't pay. So, this just burdens the system anyways and gets subsidized by the industry. Of course, since the industry marks costs up so much for the uninsured, they do okay anyways.
The sad reality is that I don't see things changing any time soon. There has been some focus on the increasing Medicaid costs, although it doesn't seem to be focused on improving the system. Instead, they seem to be targeting abuse cases that won't have a long-term effect. With socialism being such a bad word, we'll stick with the status quo. I agree, privatized systems work best the majority of the time. Not all people need all products. So the market works its magic. However, in the case of a life and death service, we need some reform. Otherwise, the U.S. will continue to spend more, while having among the shorter average life spans in the western world.