Why Are Americans Paying More For Healthcare?
The healthcare debate in the United States has always been a passionate topic. This is because it is clearly proved that America spends notably more on healthcare than any other nation. And this spending is expected to grow in the coming years.
However, the strain of spreading the healthcare system is not higher. In fact, there is a need for expansion in the testing and treating of COVID-19 to all the patients that need it, notwithstanding their health insurance status. The huge federal cash inundations have sagged the hospitals that are now burdened with both the coronavirus and regular medical care.
The high medical expenses affect everyone, no matter if they are sick or well. And this has directly weakened the spending power of each individual over the last few decades. Also, the salaries may have risen for the American workers, but they still receive the same net pay. And this is because of the increased health insurance charges. Currently, the nation should contract the overspending to stretch the hospital and medical resources for COVID-19.
So, let us delve deeper and understand the underlying problem for the high cost of healthcare in America.
1 Multiple Systems Create Waste:
The administrative cost is the prime reason why we spend excess on medical bills. As per the studies done by JAMA, the U.S. alone spends almost 8% of its total healthcare money on administrative costs. Whereas, the other ten countries (compared to in the study) spend around 1% to 3%.
The U.S healthcare system has separate rules, funding enrollment dates, private insurance like Medicaid, Medicare and out-of-pocket costs for employer insurance.
And such programs and plans deal with the multitude of regulations. These activities directly make the largest share of total administrative costs.
2 Drugs Cost Is Rising:
High drug price is the other reason that leads to overspending in America. In countries like Europe, drug prices are government regulated. They are also based on the clinical benefits of the medication.
With limited regulation on drug prices, America spends around $1,443 per person, whereas other countries spend $749. The insurers in the U.S. are allowed to negotiate the drug price with manufacturers using the facility offered by pharmacy benefit managers. But a Medicare that supports to pay out the hefty payment is not allowed to.
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