The Choice Between Life and Debt: The Exorbitant Costs of Healthcare in the United States

AUBREY TAYLOR –

The choice between necessary healthcare and financial stability should never be a predicament individuals find themselves in, yet this is the daily reality for an overwhelming number of Americans. Despite the United States serving as a global benchmark of innovation regarding medical care, the actuality of this practice in the quotidian lives of individuals has consequently spearheaded an exorbitant cost of care, prompting difficult decisions regarding both the physical and the fiscal. Thus, provided with cognizance of this economic paradox, it is imperative that individuals are informed of the realities and nuances of the economic facet of the American healthcare system; therefore, this article will investigate the varying means through which profit is prioritized over patients. 

Administrative Cost and the United States Methods of Practice

Pertaining to the discussion of the affordability of medical care within the United States, the impact of which administrative costs and spending directly showcases on the accessibility of care is of the most paramount and divisive. In 2011, the estimated government spending on health was an exorbitant 2.7 trillion, with a notable portion of this fiscal distribution categorized toward the funding of healthcare administration and expenditures toward insurance and government-led assistance programs.  This boom in the expense of the healthcare industry is heightened by its disconnect from the economic trend regarding other facets of the United States’ spending. Data has shown that from 2000 to 2011, the increase in price of medical care was the primary contributor to the boom in spending, further categorized into the prosperity of the drug industry, administrative expense, as well as advancing medical technology. Administrative costs in and of themselves account for roughly 15-25% of the entirety of the monetary outlay of the federal healthcare expenditure, understood as the consequential byproduct of the cost of private insurance, governmental healthcare assistance programs, and the complexities of billing. Each of these aforestated constituents creates a means of administration that is expansive rather than streamlined, directly increasing the overarching cost, and diverting fiscal resources away from a focus on the patient. Regarding medical technology, the United States is one of the global leaders in the practice of what is understood to be procedures that are high in cost and high in volume, specifically consisting of procedures like angioplasties, and the emphasis on medical imaging. This means that these aforementioned contributors to extortionate pricing could see reductions, which could be achieved through the streamlining of healthcare administration rather than an emphasis on expansion. Another addition, pertaining to medical images, would be comparative pricing rather than the current state of unregulated pricing, which utilizes reference prices to catalyze a reduction in the average cost of imaging, such as MRI and CT scans. However, these solutions only begin to address the underlying complexities of the healthcare affordability crisis, a significant portion of which is driven by the pharmaceutical industry’s pricing practices. 

The Drug Industry

The prevalent issue of inflation regarding the pricing of pharmaceuticals is one of the leading contributors to the boom in healthcare costs in the United States. In disharmony with many other developed nations, the United States is significantly less rigid in the regulation of its drug pricing. This allows for the creation of pharmaceutical pricing to be in conjunction with the demand that is displayed by the market appearing in the relationships between retail-dispenser and dispenser-end-user, rather than functioning in direct relation to the cost of production. It has been estimated that the supply of pharmaceuticals can account for roughly 30% of the overall cost for hospitals nationwide operationally, indicating the reasoning behind the extortionate federal spending. Yet the cost of the drug industry can not be positively correlated to an unequivocal successful result in the accessibility of healthcare or betterment of treatment methodology. Rather, it is a nuanced component that serves directly as an advantage and disadvantage regarding the contextualization toward public health. Ergo, the overt prioritization of profit over the betterment of patient care is an eminent topic of concern regarding medical ethics, particularly as patients are increasingly placed in situations in which they must weigh the cost of their life against the pressure of debt. Consequently, the addressing of these issues at hand sparks the discussion of a reworking of the current policies to construct the framework of the industry, allowing for patient care once more to become the focal point, rather than being placed on the back burner. 

 The intricacies of the American healthcare system cannot be denied, as the attempt to find the harmonious balance between profitability and patient welfare has created a landscape that directly impacts the quotidian lives of countless Americans. The excessive spending regarding constituents such as administrative costs, the pricing in the pharmaceutical industry, and the expansion of medical technology, has taken over as the national primary concern, with the patient coming second. Thus, to create reform that can reverse the paradoxical situation at hand, integrated implementation of solutions such as pricing regulation and administrative streamlining scratches the surface of the varied array of creative approaches through which change could come to fruition—subsequently, creating a national state where an individual will no longer be faced with choosing between life and debt.

Copy Editor: Dione Geiling

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