There’s an interesting case study illustrating at the WSJ illustrating why healthcare in the U. S. is so expensive. The author, a physician and a lawyer lays out the scenario:
As a doctor and a lawyer, I like to think I’m pretty good at navigating the health-care system. So when my wife and I found a large swollen bruise on our 3-year-old son’s head more than a week after he had fallen off his scooter, I was confident we could get him a CT scan at a reasonable cost.
We live near one of the top pediatric emergency rooms in the country. The care was spectacular. My son was diagnosed with a small, 11-day-old bleed inside his head, which was healing, and insignificant.
I was proud to see the health-care system working, to see academic medicine working, and most of all to see my son run as fast as he could out of the ER two hours later.
He or, rather, his insurance company received a bill for $20,000, half of which was for trauma team activation. If you don’t have access to the article, I’ll summarize it for you: he researched the bill, wrangled with the billing supervisor, and, ultimately, got the improperly levied charge for the trauma team activation removed.
The problem for most patients (or their parents) is that they aren’t physicians and lawyers, don’t have the understanding or backgrounds to make a good argument, and insurance companies don’t engage in minute examination of every bill that comes in through the transom.
There is a good lesson here, however, for why our healthcare system is so expensive:
- Facilities like the one the author found so helpful are expensive and maintaining their availability has to be billed somewhere.
- Medical bureaucracies are huge and growing. Being able to determine what and how to bill is enormously lucrative.
- Insurance doesn’t change either of those things and may even aggravate them. When insurers are paid on the basis of a percentage over outlays they have no incentive to keep outlays down.