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Why is healthcare prohibitively expensive in the US?

James972

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If the government was the reason our healthcare was so expensive then Medicare, Medicaid, and VA would be far more expensive than private hospitals and private insurance..

why? private hospitals get to charge Medicare prices too!! 1+1=2
 

James972

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Other developed nations have public insurance and even a lot of government-run hospitals and a lot more regulations on healthcare plans and pricing. So they would be even more expensive than US care because there is more government.

Hard to imagine more govt than USA has in health care. Europe is poor and has a very efficient form of socialism so their prices are lower.
 

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As you may know, the costs of healthcare are going up faster than GDP. Healthcare in the US is getting rather expensive these days.

Supporters of universal healthcare typically say that since healthcare is a basic necessity, prices do not affect demand because without it, people will die. The economic term for how much demand changes relative to price is price elasticity. To their credit, healthcare is an inelastic good (demand changes more slowly than price), but on the other hand, it isn't the only one.

Other examples of inelastic goods are gasoline, clothing, recreational drugs (including tobacco), and to some extent, food and water. And yet, we don't see companies price gouge on gasoline, clothing, food, or water. Now maybe one could make the case that water utilities are heavily regulated or are owned by municipal governments and most recreational drugs are illegal but what about the others?

Although the cost of food has gone up in the last generation or so, it didn't do so by nearly as much as healthcare. When food (or drinks) get close to expiration date, they go on sale. In fact, sometimes when they're not close to expiration date, they go on sale. Clothing likewise is not being price gouged.

Oil is considered an inelastic good because it's necessary to power our cars. Sure, electric cars exist, but the market is only in its infancy. But despite the importance of oil, prices aren't constantly on the rise, even with growing demand. Rather, they fluctuate, even though most oil reserves are in OPEC countries.

So why don't the markets of other inelastic markets see a great amount of price gouging? The answer is competition. If Safeway charges too much for groceries, shoppers will simply look elsewhere. If one gas station charges too much for gasoline, people will go to other gas stations. The markets for clothing likewise don't price gouge because there is competition. Thes markets are inelastic, if the price rises by a lot, there will still be a great deal of demand for them. An inelastic market will be able to maintain fairly small prices so long as there is competition. Thus it is worth asking why we don't see the same in healthcare.

It would perhaps be fallacious to say that healthcare in the US is expensive purely because of the free market because it is one of the most heavily regulated sectors in the US economy.

If this Forbes article is to be trusted, the US government is limiting the number of physicians per year, causing a shortage and thus raising the cost of medical care due to lobbying on the part of the AMA. The government has also restricted the establishment of medical schools. Foreign doctors have to redo their residencies, regardless of how long they have been practicing, to legally practice in the US.
The Evil-Mongering Of The American Medical Association

Another problem is prescription drug medication. Thanks to patents, prescription drug companies have the license to price gouge their consumers without fear of competition. Some argue that the patent system guerantees that drug manufacturers will make a profit after developing the drug. The problem with this notion is that the big prescription drug companies spend more money on marketing than on R&D.
https://www.washingtonpost.com/news...rketing-than-research/?utm_term=.be4ebaf0521a

Which brings me onto my next point. The FDA puts a long and burdensome process on getting drugs approved. While it may be with best of intentions, it has effectively prevented many would be useful drugs from coming onto the market. Big pharmaceutical companies have little trouble complying with these regulations but smaller companies are effectively crowded out.

Capitalism is the short answer.
 

James972

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the government doesn't go an amazing job but it does do a good enough job but it can give us an ok product at an ok price.
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we know from many examples that govt monopoly( USSR Europe Cuba East Germany Formosa, Hong Kong, Red China, etc etc) that standard of living will be about 40% of capitalist standard of living.
 
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James972

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some private markets are so bad at controlling costs and providing affordable services to the population that we need government services and regulation of the private market to make it affordable and save for most people.

do you have an example of this or just pretending???
 

James972

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Other private markets are also not good either which is why we have the public services I listed above like public utilities and public schools.

our public schools are the most expensive in the world and about lowest quality in civilized world. 1+1=2
 

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our public schools are the most expensive in the world and about lowest quality in civilized world. 1+1=2

But our public schools are vastly cheaper than our private schools, and by your own admission, other countries have created public education systems that are much cheaper and more cost effective. So it is possible to make a decent public education system, maybe we just haven't made our public system right. Or maybe our children just tend to be a lot lazier than kids in other countries and therefore we get a lot less out of all the money we are spending on them.
 

distraff

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do you have an example of this or just pretending???

An example of a private market that is bad at controlling cost? The US healthcare system is one example. Also public electrical and water utilities are another example. Its impossible to have 12 different set of electric wires and pipes everywhere so we can't have proper competition.That is why our utilities are publicly owned or at least regulated to prevent price gouging. Some markets are natural monopolies and others aren't that bad but have low demand elasticity to price and may require public services or regulation. The free market doesn't always result in perfect prices, that is a myth that can easily be dispelled from a basic understanding of economics.
 

James972

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But our public schools are vastly cheaper than our private schools,

obviously a monopoly will not have cheaper prices than a competitive school or business!!!1+1=2
 

distraff

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we know from many examples that govt monopoly( USSR Europe Cuba East Germany Formosa, Hong Kong, Red China, etc etc) that standard of living will be about 40% of capitalist standard of living.

It depends on the market. Some private markets are very good at controlling prices, and some aren't. The government is better at providing some services than others. It does a fine job providing fire department services, but not running the entire economy.
 

James972

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So it is possible to make a decent public education system, maybe we just haven't made our public system right..

charter schools do much better because they are not monopolies, obviously. To survive they need to be competitive. Is this really over your socialist head?
 

James972

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. Some private markets are very good at controlling prices, and some aren't..

if so why are you so afraid to give your best example????????????
 

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where is there private health care???

Private healthcare is healthcare that is provided and funded through private businesses and payments rather than government-run programs and taxes. The US is an example of a system that is private.
 

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It does a fine job providing fire department services,

you have no evidence of that, you just made it up out of thin air because it suits your socialist tendencies.
 

James972

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Private healthcare is healthcare that is provided and funded through private businesses and payments rather than government-run programs and taxes. The US is an example of a system that is private.

don't be a silly goof. Democrats made private competition illegal in US health care in 1946 with McCarren Furguson. A private business that cant compete is not a private capitalist business. Do you understand now???
 

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The US is an example of a system that is private.

so now you're pretending to be insane?? Actually Medicare Medcaid, VA Schip TRIcare, IMS, Community Clinics, intra state competition are far from private Republican capitalism. Liberals lack the IQ to understand Republican capitalism so we don't have it and pay 5 times what we should.
 

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Hard to imagine more govt than USA has in health care. Europe is poor and has a very efficient form of socialism so their prices are lower.

No, the US has less government involvement in healthcare than every other developed nations. In other developed nations, the majority of healthcare is paid for by the government, and the government has set up a basic framework for how healthcare can be run in a cost-effective way. In many developed nations, most hospitals are publicly run by the government, and in others, there are still many public hospitals. In many developed nations, there are a lot of government regulations on healthcare to ensure universal access, good coverage, and lower prices.

If you look at wages in Europe, they are lower than in the US, but not that much lower, and in some countries, they are equivalent to the US. Europeans also work a lot less in the US, have a lot better vacation and free healthcare, and other public programs than the US. They also pay a lot less for public healthcare than the US, so their public healthcare isn't much of a financial burden to them.
 

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why? private hospitals get to charge Medicare prices too!! 1+1=2

If the government as so bad at keeping prices down, then Medicare and Medicaid should be so full of red tape and so inefficient that it should be a lot more expensive than private insurance. Also, people with this government insurance should have a much lower approval of that insurance than private insurance. Private hospitals negotiate Medicare prices independently of private insurance prices.
 

James972

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No, the US has less government involvement in healthcare than every other developed nations.

USA has 20 major overlapping and conflicting socialist bureaucracies that make it a far less efficient socialism than the slimed down socialist countries in Europe.
 

James972

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If the government as so bad at keeping prices down, then Medicare and Medicaid should be so full of red tape and so inefficient that it should be a lot more expensive than private insurance.

there is no private insurance since Democrats made competition illegal. HOw many times do you need to learn this?
 

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so now you're pretending to be insane?? Actually Medicare Medcaid, VA Schip TRIcare, IMS, Community Clinics, intra state competition are far from private Republican capitalism. Liberals lack the IQ to understand Republican capitalism so we don't have it and pay 5 times what we should.

We do have some publicly run healthcare providers, but the vast majority are private companies and private hospitals. I personally have never been to a public healthcare facility before. And can you show that these public facilities are far more expensive than private hospitals which should be better at lowering prices thanks to free market competition?
 

James972

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If you look at wages in Europe, they are lower than in the US, but not that much lower, and in some countries,

FRance is a liberals wet dream with almost double our taxation, they have per capita income of Arkansas about our poorest state and are literally rioting in the streets every weekend because the poor still cant make ends meet!!! Do you understand?
 

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don't be a silly goof. Democrats made private competition illegal in US health care in 1946 with McCarren Furguson. A private business that cant compete is not a private capitalist business. Do you understand now???

Not true. We have many health insurance companies that compete to attract customer and companies. We also have numerous hospitals and medical clinics in the same areas that are free to set their own prices.
 

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you have no evidence of that, you just made it up out of thin air because it suits your socialist tendencies.

We don't hear about fire departments becoming hard for cities to afford like we do for healthcare.
 
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