Economic Justice & Corporate Capture
America's Broken Healthcare System
WHY THE HEALTHCARE SYSTEM IN THE U.S. IS SO BROKEN AND SERVES ONLY THE RICH
By William N. Sosis
1. Introduction
2. America’s Wealth and Global Standing
3. The U.S. Healthcare System: A Structural Overview
4. The Role of Private Insurance and Market Fragmentation
5. The Price of Care: Why Costs Are So High
6. Access and Inequality: Who Gets Left Behind
7. How Policy and Lobbying Sustain the Status Quo
8. Comparative Case Studies: Lessons from Other Wealthy Nations
9. The Consequences: Health Outcomes and Economic Burden
10. Conclusion and Possibilities for Reform
The United States stands as the world’s largest economy, a global hegemon, and a beacon of innovation and wealth creation. With a GDP exceeding $25 trillion and home to many of the world's wealthiest individuals and most powerful corporations, the U.S. is widely regarded as the richest country on Earth.1 Yet despite this unprecedented economic prowess, the American healthcare system consistently ranks among the worst in the developed world on measures of access, equity, outcomes, and cost efficiency.2 For millions of Americans, healthcare is neither affordable nor accessible, and for the poorest citizens, it can be wholly out of reach — an irony in a nation that leads the world in medical innovation, biotechnology, and hospital revenue.
The contradiction is glaring. How can the richest country on Earth maintain a system where medical bankruptcies are common, people ration insulin, and preventative care is often a luxury? Why do health outcomes lag behind nations with a fraction of its resources? And how did healthcare evolve into a profit-driven enterprise that so often prioritizes shareholders over patients?
This essay seeks to examine these questions through a comprehensive analysis of the American healthcare system — its history, structure, and the economic and political forces that shape it. It argues that the U.S. system is not merely inefficient or dysfunctional by accident, but rather designed in ways that perpetuate inequality and serve the interests of the wealthy and well-connected. From the perverse incentives embedded in insurance reimbursement models to the influence of powerful lobbying groups, the healthcare system is a reflection of broader patterns of inequality and systemic exclusion within American society.
Furthermore, this essay will contrast the U.S. with other wealthy nations that have managed to deliver universal healthcare at a fraction of the cost and with better outcomes. By identifying the ideological, structural, and political barriers to reform, we can begin to understand why a nation with so many resources remains unable — or unwilling — to guarantee healthcare as a human right for all its citizens.
Footnotes
1. World Bank, “GDP (Current US$) – United States,” World Development Indicators, https://data.worldbank.org/indicator/NY.GDP.MKTP.CD?locations=US
2. The Commonwealth Fund, “Mirror, Mirror 2021: Reflecting Poorly – Health Care in the U.S. Compared to Other High-Income Countries,” https://www.commonwealthfund.org/publications/fund-reports/2021/aug/mirror-mirror-2021-reflecting-poorly
AMERICA’S WEALTH AND GLOBAL STANDING
At the dawn of the 21st century, the United States entered an era of global dominance characterized by unmatched economic, military, and technological power. As of 2024, the U.S. economy generates more than $25 trillion annually, outpacing every other nation in both nominal GDP and per capita income among large industrialized economies.1 It is home to 7 of the 10 largest companies in the world by market capitalization, dozens of billionaire entrepreneurs, and institutions that shape global financial markets, such as the Federal Reserve and Wall Street investment firms. From Silicon Valley to the pharmaceutical corridors of New Jersey and Boston, America’s economy is a hub of innovation, scientific progress, and capital accumulation.
Yet this extraordinary wealth is not uniformly distributed — a defining feature of modern American capitalism. While the U.S. leads the world in billionaires and corporate profits, it also faces stark internal disparities. Income inequality has reached levels not seen since the Gilded Age, with the top 10% controlling nearly 70% of the country’s wealth.2 The wealthiest families can access world-class medical care at elite institutions like the Mayo Clinic, Cleveland Clinic, or concierge services that offer house calls, personalized treatment plans, and access to experimental drugs. In contrast, the bottom half of the population often struggles to afford basic care, especially when they lack employer-sponsored insurance or live in states with poor Medicaid coverage.
The economic architecture of the United States is inherently contradictory. On the one hand, it is a bastion of free market ideology, celebrating the virtues of competition, innovation, and private enterprise. On the other, it is riddled with monopolies, regulatory capture, and lobbying practices that distort those ideals. The healthcare industry exemplifies this contradiction. Hospitals, insurance companies, and pharmaceutical firms operate as powerful, often monopolistic entities within regional markets. Despite the image of a competitive marketplace, patients rarely have the information, choice, or negotiating power necessary for true consumer control.
One might expect that such a wealthy nation would devote a significant portion of its resources to ensuring the health and well-being of its people. In fact, the United States spends more on healthcare per capita than any other nation on Earth — over $13,000 annually as of 2023, more than twice the average of other high-income countries.3 Yet these high expenditures do not translate into superior outcomes. The U.S. ranks near the bottom among peer nations on metrics like life expectancy, infant mortality, maternal health, chronic disease management, and preventable hospitalizations.4 This paradox — high spending with poor results — underscores the extent to which American wealth does not equate to universal well-being.
The privatized nature of the U.S. healthcare system amplifies this divide. In most developed nations, healthcare is a public good, financed collectively through taxes and provided either directly by the government or through highly regulated non-profit insurers. In the U.S., however, healthcare is primarily a commercial enterprise. This foundational difference explains much of the dysfunction that follows: patients are treated as consumers, health is commodified, and outcomes are secondary to revenues. For those without the financial means or stable employment, access to care becomes a matter of chance rather than right.
The disconnect between America’s material wealth and the suffering of millions within its borders reflects deeper structural imbalances. These include systemic racism, unequal education systems, a frayed social safety net, and an economy that prizes growth and profit over equity and public welfare. Healthcare, as one of the most personal and consequential aspects of human life, becomes a mirror of these larger issues.
In the coming sections, this essay will show how these economic and ideological conditions laid the foundation for a healthcare system that disproportionately serves the wealthy. It will also explore how political decisions — not technological limitations or budgetary constraints — are the primary barriers to creating a fair and functional healthcare system in the world’s richest country.
Footnotes
1. International Monetary Fund, “World Economic Outlook Database,” October 2023, https://www.imf.org/en/Publications/WEO/weo-database/2023/October
2. Emmanuel Saez and Gabriel Zucman, The Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay (New York: W.W. Norton, 2019)
3. Peterson-KFF Health System Tracker, “Health Spending in the U.S. Compared to Other Countries,” 2023, https://www.healthsystemtracker.org/chart-collection/health-spending-u-s...
4. Commonwealth Fund, “Mirror, Mirror 2021: Reflecting Poorly,” supra note 2.
THE U.S. HEALTHCARE SYSTEM: A STRUCTURAL OVERVIEW
To understand why the U.S. healthcare system functions the way it does — with high costs, inconsistent access, and deep inequality — we must first understand its structure. Unlike most wealthy nations, the United States does not have a single, unified healthcare system. Instead, it operates a complex and fragmented web of public and private payers, providers, and regulators. This fragmentation contributes to inefficiencies, administrative waste, and inconsistent standards of care across regions, populations, and income levels.
A Multipayer System with Unequal Access
At the heart of the American system lies a multipayer model — a patchwork of private insurance, employer-based coverage, public programs like Medicare and Medicaid, and out-of-pocket payments by uninsured individuals. As of 2024, roughly 49% of Americans receive health insurance through their employer, 18% through Medicare (primarily for seniors), 15% through Medicaid (for low-income individuals and families), and around 6% purchase insurance through the Affordable Care Act’s (ACA) exchanges.1 Despite these mechanisms, more than 25 million people remain uninsured, and tens of millions more are underinsured — meaning they technically have insurance but still face high deductibles, copays, and other barriers to care.2
This system inherently advantages people with stable employment, higher incomes, and access to high-quality employers. Conversely, it leaves vulnerable populations — such as the unemployed, gig workers, undocumented immigrants, and low-wage employees — with inferior or no coverage. Employer-based insurance is particularly problematic because it ties health security to job security, which creates volatility in times of economic downturns or job transitions.
Private Insurance and Market Power
Private insurance companies play a dominant role in determining what care is delivered, how much it costs, and whether it is covered at all. These companies operate for profit, and their primary obligations are to shareholders, not patients. Through mechanisms like prior authorization, utilization reviews, narrow provider networks, and formularies (lists of approved medications), insurers routinely override the medical judgment of physicians. This leads to delays, denials, and administrative burdens that consume time, money, and patient energy.
Moreover, consolidation within the insurance market has reduced competition. In many states, a single insurer controls over 70% of the commercial market.3 This gives insurers immense leverage in negotiating prices, but paradoxically, it does not lead to lower premiums or better outcomes. Instead, profits are often channeled into executive compensation, marketing, stock buybacks, and lobbying efforts to resist reform.
Hospitals, Consolidation, and Charging Practices
Hospitals, too, are major players in this ecosystem — and many now operate as large corporate entities. Over the past two decades, the U.S. has seen a wave of hospital consolidation, with small independent hospitals being absorbed into massive health systems. This consolidation has driven up prices, reduced competition, and weakened the negotiating position of patients and even some insurers.4
Hospitals set prices using a chargemaster — an internal list of charges for every service and item provided. These charges bear little relation to the actual cost of delivering care. Instead, they are used as bargaining chips in negotiations with insurers. The final price a patient sees depends on their insurance company’s negotiated rate. For the uninsured, however, the chargemaster rate — often multiple times higher than the Medicare rate — is the starting point, unless they are able to negotiate discounts or qualify for financial assistance.
Pharmaceuticals and the Cost of Innovation
Another structural driver of healthcare dysfunction is the pharmaceutical industry. While the U.S. is a global leader in drug development and biotech, it also allows drug companies to set prices with minimal oversight. Unlike many countries where drug prices are negotiated or capped by the government, the U.S. lets companies charge what the market will bear — often resulting in exorbitant prices for life-saving medications like insulin, cancer drugs, and gene therapies.
Pharmaceutical companies justify high prices by citing research and development costs, but this narrative obscures how much of that research is actually funded by public sources like the National Institutes of Health (NIH). Additionally, drug companies invest heavily in marketing — spending more on advertising and physician outreach than on R&D in many cases.5 Patents and market exclusivity provisions further allow firms to suppress competition and maintain monopolistic pricing.
Administrative Complexity and Waste
The structural complexity of the U.S. system produces staggering levels of administrative waste. A 2019 study published in Annals of Internal Medicine estimated that administrative costs accounted for nearly 25% of total healthcare spending — far more than in other wealthy nations.6 These costs stem from billing departments, insurance paperwork, coding systems, prior authorization processes, and other bureaucratic functions required to operate within the multipayer model.
Providers must hire armies of billing specialists to navigate insurance rules, appeal denials, and manage reimbursements. This complexity wastes resources and contributes to physician burnout, as doctors spend increasing amounts of time on non-clinical paperwork.
Public Programs: Medicare and Medicaid
Medicare and Medicaid, while critical lifelines for millions, are constrained in their ability to correct these structural problems. Medicare is a federal program that covers Americans over 65 and some younger people with disabilities. It sets standardized rates and has lower administrative costs than private insurance. However, it has gaps — particularly in dental, vision, and long-term care — and increasingly relies on Medicare Advantage, a privatized model that reintroduces many of the inefficiencies of private insurance.
Medicaid, jointly funded by the federal government and states, covers low-income individuals. It is often underfunded and stigmatized, and its coverage and reimbursement levels vary dramatically by state. In states that refused Medicaid expansion under the ACA, millions of poor adults fall into a “coverage gap” — too poor to qualify for subsidies, yet not eligible for Medicaid.
Conclusion: A System Built on Fragmentation and Profit
The structural design of the U.S. healthcare system is neither inevitable nor the result of market forces alone. It is the outcome of decades of policy decisions that prioritized private industry over public welfare, fragmentation over integration, and profit over equity. These design choices continue to shape the healthcare landscape in ways that benefit the wealthy and powerful, while leaving tens of millions of Americans at the mercy of a system that is too complex, too expensive, and too unjust to fulfill the basic promise of care.
Footnotes
1. U.S. Census Bureau, “Health Insurance Coverage in the United States: 2023,” https://www.census.gov/library/publications/2023/demo/p60-279.html
2. The Commonwealth Fund, “Underinsured Americans: Who Are They and Why Are They Vulnerable?” 2022, https://www.commonwealthfund.org
3. American Medical Association, “Competition in Health Insurance: A Comprehensive Study of U.S. Markets,” 2023.
4. Health Affairs, “The Impact of Hospital Consolidation — Update,” 2019, https://www.healthaffairs.org/do/10.1377/forefront.20190214.487045/
5. Public Citizen, “Pharma’s Big Lie: The R&D Scam,” https://www.citizen.org/article/pharma-rd-lie-report/
6. Himmelstein, Woolhandler et al., “Administrative Costs in the U.S. Health Care System,” Annals of Internal Medicine, 2019.
THE ROLE OF PRIVATE INSURANCE AND MARKET FRAGMENTATION
Private insurance is at the heart of the American healthcare system’s dysfunction. While other developed nations provide coverage through centralized, publicly funded systems or tightly regulated private insurers operating under public mandates, the United States has chosen a deeply fragmented approach dominated by private, for-profit entities. This system was never designed for universal coverage, and it continues to prioritize corporate interests over public health. The result is a healthcare marketplace that is expensive, opaque, and often hostile to those without wealth or employer-sponsored plans.
The Origins of Employer-Based Insurance
The origins of private insurance dominance in the U.S. are both historical and economic. During World War II, wage controls prohibited companies from offering salary increases, so they began offering health insurance as a fringe benefit to attract workers. After the war, this model stuck. In 1954, the IRS codified the tax-free status of employer-sponsored health insurance, cementing the link between employment and coverage.1 Today, nearly half of Americans — over 160 million people — receive health insurance through an employer.
While this system works reasonably well for those with stable, full-time jobs at companies that offer generous benefits, it creates massive gaps for the unemployed, self-employed, part-time workers, and gig economy participants. The COVID-19 pandemic starkly revealed these vulnerabilities when millions of Americans lost both their jobs and their health insurance simultaneously, leading to a surge in uninsured rates.2
The Rise of Managed Care and HMOs
In the 1970s and 1980s, as healthcare costs began to soar, insurers shifted toward managed care models to control spending. Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), and other plan types emerged, each with its own set of rules regarding in-network providers, referral requirements, and cost-sharing mechanisms.
While managed care did succeed in slowing cost growth temporarily, it introduced a new set of problems. Patients found themselves constrained by narrow networks — lists of approved doctors and hospitals — and often had to navigate complex bureaucracies to obtain referrals, prior authorizations, and reimbursement approvals. Doctors, in turn, became beholden not just to their clinical judgment, but to the dictates of insurance clerks and utilization review officers.
Insurer Profitability vs. Patient Needs
At the core of the private insurance model lies a fundamental conflict: the insurer’s financial incentive is to collect premiums and minimize payouts. This dynamic results in frequent efforts to deny or delay care, particularly for expensive or long-term treatments. Insurers employ armies of administrative staff to scrutinize medical claims, require documentation, and reject care they deem "not medically necessary" — often with vague or inconsistent reasoning.
Insurers justify this behavior by claiming to prevent unnecessary or fraudulent care. But numerous investigative reports and lawsuits have revealed that claims denials are often arbitrary, and in some cases, algorithms are used to approve or deny requests without human review.3 The result is that patients and their physicians are forced to fight for needed treatments, endure delays, or abandon care entirely due to time or cost constraints.
Additionally, prior authorization — the requirement that a physician obtain insurer approval before proceeding with treatment — has become a widespread tool for cost control. According to the American Medical Association, 94% of doctors report that prior authorization causes treatment delays, and 30% say it has led to serious adverse health events in their patients.4
Market Fragmentation and Administrative Waste
One of the most consequential effects of a private, multipayer system is the vast administrative burden it imposes. Each insurance company has its own billing rules, codes, coverage policies, and claim submission processes. This forces healthcare providers to hire dedicated billing departments just to keep up with paperwork.
A study by the Journal of the American Medical Association found that administrative expenses account for 20–25% of total healthcare expenditures in the U.S. — roughly double that of single-payer systems like Canada’s.5 This administrative complexity serves no clinical purpose; it is the cost of doing business in a fragmented system designed around profit-seeking intermediaries.
Moreover, patients face their own version of this burden. Understanding deductibles, copays, coinsurance, in-network versus out-of-network distinctions, Explanation of Benefits (EOBs), surprise billing rules, and medical debt collection practices requires legal or financial expertise far beyond what most consumers possess. This complexity creates stress, delays, and often prevents people from seeking timely care.
The ACA and the Illusion of Choice
The Affordable Care Act (ACA) attempted to expand coverage and reduce costs, primarily by creating insurance marketplaces (or “exchanges”) where individuals could purchase subsidized plans. While the ACA successfully reduced the uninsured rate and introduced important protections (like banning denial for pre-existing conditions), it did not alter the underlying structure of the private insurance market.
ACA plans are still sold by private companies and still suffer from the same issues: narrow networks, high deductibles, and rising premiums. Furthermore, because insurers are allowed to design a wide variety of plans with different cost structures, many consumers are overwhelmed with choices that are difficult to compare — what health economist Uwe Reinhardt once called "an illusion of choice in a jungle of complexity."6
Medicare Advantage: Privatization by Another Name
The privatization trend within public programs is most visible in Medicare Advantage (MA), a rapidly growing subset of Medicare in which beneficiaries receive care through private insurance companies rather than the traditional fee-for-service model. MA plans offer lower premiums and extra benefits like dental and vision care — but often at the cost of more restrictive networks and more aggressive utilization controls.
While marketed as a way to increase efficiency, MA plans have been criticized for upcoding (artificially inflating the severity of patients’ conditions to increase reimbursements) and for denying medically necessary care at higher rates than traditional Medicare.7 Despite this, MA enrollment now exceeds 50% of all Medicare beneficiaries, reflecting both policy incentives and the lack of awareness about the drawbacks among seniors.
The Cost of Market Fragmentation to Patients
The cumulative effect of this fragmentation is a system in which access to care depends less on medical need than on coverage status, income, and geography. A wealthy executive with a platinum-tier insurance plan can access immediate, comprehensive care from elite institutions, while a part-time retail worker with a bronze-tier plan (or none at all) may delay treatment, avoid prescriptions, or skip doctor visits altogether.
Even among insured patients, out-of-pocket costs can be devastating. High-deductible health plans (HDHPs) have become the norm in the employer market, pushing more financial responsibility onto patients. According to a 2022 KFF survey, nearly one-third of insured adults struggle to afford their healthcare costs, and 40% report skipping or delaying care due to cost.8
This tiered access to healthcare entrenches existing inequalities and contradicts the very purpose of medicine: to provide care based on need, not wealth.
Conclusion: The Insurance Industry as Gatekeeper
The American healthcare system’s reliance on private insurers is a central reason why it is both the most expensive and the most inequitable in the developed world. These insurers act not as facilitators of care but as gatekeepers — deciding who gets care, when, and under what conditions. Their profit motive, combined with a lack of regulatory accountability, creates perverse incentives that prioritize denial over delivery and cost control over compassion.
Unlike physicians, who are ethically bound to serve their patients, insurers are bound only by shareholder expectations and actuarial math. Until this structural contradiction is addressed — either through comprehensive regulation or a move toward a public, unified system — the U.S. healthcare system will continue to serve the few at the expense of the many.
Footnotes
1. Melissa Thomasson, “From Sickness to Health: The Twentieth-Century Development of U.S. Health Insurance,” Explorations in Economic History, 2002.
2. Urban Institute, “The COVID-19 Pandemic and Resulting Economic Crash Have Caused the Greatest Health Insurance Losses in American History,” 2020.
3. ProPublica, “How Medicare Advantage Plans Deny Care,” 2022, https://www.propublica.org/article/medicare-advantage-healthcare-denials
4. American Medical Association, “2021 Prior Authorization Physician Survey,” https://www.ama-assn.org
5. Tseng, Paul et al., “Administrative Costs in the U.S. Compared to Canada,” JAMA, 2020.
6. Uwe Reinhardt, Priced Out: The Economic and Ethical Costs of American Health Care, (Princeton University Press, 2019).
7. U.S. Government Accountability Office, “Medicare Advantage: CMS Should Use Data on Denials to Strengthen Oversight,” 2022.
8. KFF, “Health Care Debt in the U.S.: The Broad Consequences of Medical and Dental Bills,” 2022, https://www.kff.org
THE PRICE OF CARE: WHY COSTS ARE SO HIGH
The United States spends far more on healthcare than any other country — over $4.5 trillion annually, or more than $13,000 per person.1 This staggering sum does not reflect greater utilization of healthcare services, nor does it result in better health outcomes. Instead, the U.S. pays more for virtually every aspect of healthcare: hospital stays, physician visits, medical procedures, diagnostic imaging, prescription drugs, and administrative costs. But why is everything so expensive?
The short answer is that the prices themselves are higher — often unjustifiably so — and the system lacks effective mechanisms to control them. In other countries, governments negotiate or directly regulate prices. In the U.S., prices are the result of opaque negotiations between insurers and providers, guided more by market power than by medical necessity or cost-effectiveness. This section explores the drivers of these elevated prices and the consequences for American patients.
1. Lack of Price Regulation and Negotiation
Unlike in single-payer systems, where the government acts as the sole or primary purchaser of healthcare and can set prices based on national budgets or cost-effectiveness assessments, the U.S. lacks any centralized mechanism to control prices across the board. The federal government sets prices for Medicare and Medicaid, but these programs cover only a portion of the population, and even then, their price-setting is often undermined by the growing role of privatized alternatives like Medicare Advantage.
In the private sector, prices are determined through secret negotiations between insurers and providers. Hospitals and physician groups with more market power — often due to consolidation — can demand higher payments for the same services. Insurers may pass these higher costs onto consumers through higher premiums, deductibles, and copays.
This fragmented, decentralized model means that the same procedure can vary wildly in cost depending on who is paying, where it's performed, and whether the provider is in-network. A colonoscopy that costs $300 in one clinic might cost $5,000 at a hospital-owned facility a few blocks away. For uninsured patients or those out-of-network, the cost may be even higher — as they are often billed the “chargemaster” rate, an inflated list price far removed from negotiated rates.2
2. Hospital Monopolies and Consolidation
Hospital prices have surged in recent decades, driven in part by widespread consolidation in the hospital industry. Between 2000 and 2020, the number of independent hospitals declined sharply as mergers and acquisitions swept the industry. Today, 60% of U.S. hospitals belong to health systems, many of which dominate their regional markets.3
When hospitals consolidate, they can demand higher prices from insurers — often by threatening to withdraw from a provider network, which would render the plan unattractive to patients. Studies show that in markets with less hospital competition, prices are significantly higher, with no corresponding improvement in quality or outcomes.4
Nonprofit hospitals, which make up about 58% of U.S. hospitals, are often equally aggressive in billing practices despite their tax-exempt status. Many of these hospitals operate more like corporations than charities — investing in luxury facilities, executive pay, and debt-financed expansions, all while suing low-income patients for unpaid bills.5
3. Physician Compensation and Specialty Care
Physician salaries in the U.S. are among the highest in the world. While primary care doctors earn around $250,000 on average, many specialists earn $400,000–$600,000 or more annually.6 This disparity is in part a result of the fee-for-service model, which rewards volume and complexity over preventive or holistic care.
The American system incentivizes specialty care and expensive procedures over time-intensive services like chronic disease management or mental health care. A cardiologist performing stent procedures or an orthopedic surgeon conducting joint replacements can bill significantly more than a primary care physician seeing multiple patients in a day. As a result, the U.S. system encourages intervention over prevention and overvalues technical procedures.
4. Drug Prices and Pharmaceutical Influence
Another major contributor to healthcare costs is the price of prescription drugs. Americans spend more per capita on medications than any other country — in many cases, two to three times more than consumers in Canada or Europe. This is largely because the U.S. does not regulate drug prices or negotiate them on behalf of the population, except in limited cases (such as the Veterans Health Administration).
Pharmaceutical companies have extraordinary pricing freedom and often introduce new drugs at prices exceeding $100,000 per course of treatment. Even old and widely used medications, like insulin, are subject to dramatic price increases due to the lack of generic competition, “evergreening” of patents, and the use of pharmacy benefit managers (PBMs) that add complexity and markup to the supply chain.7
Efforts to allow Medicare to negotiate drug prices have long been blocked by industry lobbying. Only recently, with the passage of the Inflation Reduction Act in 2022, did Congress grant Medicare limited authority to negotiate prices on a small number of high-cost drugs — a first step, but far from comprehensive reform.8
5. Administrative Waste and Complex Billing
As discussed earlier, the U.S. spends an enormous amount on administrative overhead, which adds nothing to the quality of care but significantly inflates costs. Billing departments, prior authorization processes, coding for thousands of diagnostic and procedural codes, and compliance with different insurers’ rules all create inefficiencies that drive up costs.
Providers are forced to navigate these burdens just to be paid, while patients are bombarded with explanations of benefits (EOBs), multiple bills from different providers for a single hospital visit, and opaque pricing that makes it nearly impossible to shop for care or anticipate costs. In most cases, patients are not told the cost of care until after it is delivered, making the notion of consumer choice largely irrelevant in emergencies or complex treatments.
6. Legal and Defensive Medicine
The threat of litigation also contributes to the cost of care in the U.S. While malpractice suits are relatively rare and declining, physicians often practice defensive medicine — ordering unnecessary tests or procedures simply to protect themselves from potential lawsuits. This adds billions to healthcare costs annually, although estimates vary widely as to how significant the effect truly is.
Tort reform has been implemented in several states with mixed results. Critics argue that while limiting liability may reduce insurance premiums for doctors, it does little to control overall healthcare spending or improve patient safety.
7. Health Insurance Design and Cost-Shifting
Finally, the structure of insurance itself exacerbates high costs. Over the past two decades, insurers have increasingly adopted high-deductible health plans (HDHPs), which shift more of the financial burden onto patients. This model encourages cost-consciousness but also leads many people to forgo necessary care due to affordability concerns.
At the same time, insurers have not meaningfully reduced premiums or out-of-pocket limits for consumers. Instead, employers and insurers continue to pass on more costs to patients — particularly those with chronic conditions or frequent medical needs.
This cost-shifting, coupled with rising list prices from providers, creates a vicious cycle: patients become sicker because they delay care, which in turn leads to more expensive interventions later.
Conclusion: A System Priced For Profit, Not For People
The high cost of American healthcare is not due to innovation, quality, or efficiency — it is due to deliberate choices that prioritize profit, market consolidation, and fragmented systems over public good. From hospitals to insurers to drug companies, every player in the system has incentives to increase prices, bill more aggressively, and resist transparency.
While many Americans still believe the U.S. has the “best healthcare in the world,” this belief is often based on anecdotal access to elite institutions or cutting-edge procedures — not on a system that delivers consistent, affordable, and equitable care for all. The reality is that the U.S. pays more to achieve less, and the burden of this inefficiency falls hardest on the poor, the uninsured, and the chronically ill.
Footnotes
1. Centers for Medicare & Medicaid Services (CMS), “National Health Expenditures 2023 Highlights,” https://www.cms.gov
2. National Public Radio, “Why Hospital Chargemaster Prices Are So Ridiculously High,” https://www.npr.org
3. American Hospital Association, “Fast Facts on U.S. Hospitals,” 2023.
4. Cooper, Zack et al., “The Price Ain’t Right? Hospital Prices and Health Spending on the Privately Insured,” Quarterly Journal of Economics, 2019.
5. New York Times, “They Sued Thousands of Patients — Then They Moved to Garnish Wages,” 2019.
6. Medscape Physician Compensation Report 2023, https://www.medscape.com
7. Public Citizen, “Pharma’s Big Lie,” supra note 11.
8. U.S. Department of Health and Human Services, “Medicare Drug Price Negotiation Program,” https://www.hhs.gov/inflation-reduction-act/index.html
ACCESS AND INEQUALITY: WHO GETS LEFT BEHIND
Despite being the richest nation on Earth, the United States has one of the most unequal healthcare systems among developed countries. Healthcare in the U.S. is not distributed according to need or medical urgency but rather by employment status, income level, geography, race, immigration status, and insurance type. The result is a stratified system in which wealthy and well-insured individuals have access to the best care in the world, while tens of millions struggle to obtain even basic services. This section explores the deep inequalities embedded in the U.S. healthcare system and how they reflect broader patterns of structural disadvantage.
1. The Uninsured and Underinsured
In 2023, 27.6 million Americans lacked health insurance altogether, and tens of millions more were considered underinsured — meaning their insurance left them exposed to high deductibles, copays, or uncovered services.1 While the Affordable Care Act (ACA) reduced the number of uninsured people, particularly in states that expanded Medicaid, it left many without adequate coverage due to political resistance, affordability challenges, and gaps in eligibility.
Being uninsured in America is not just an inconvenience — it’s a life-threatening condition. Uninsured individuals are:
• Less likely to have a regular source of care
• More likely to delay or forgo treatment due to cost
• More likely to die from preventable or manageable conditions
A widely cited 2009 study estimated that nearly 45,000 deaths annually in the U.S. were associated with lack of health insurance.2 And since then, gaps in coverage have continued to cost lives, especially in states that declined to expand Medicaid.
2. Racial and Ethnic Disparities
Healthcare access and outcomes in the U.S. are deeply racialized. People of color — especially Black, Latino, Native American, and some Asian communities — experience significantly worse health outcomes and more limited access to care. These disparities are rooted in both historical injustices and contemporary systemic racism in housing, employment, education, and criminal justice.
• Black Americans have higher rates of maternal mortality, chronic illness, and COVID-19 deaths than whites.
• Latino communities have higher uninsured rates due to employment in low-wage sectors that don’t provide benefits and immigration-related exclusions.
• Native Americans, often living in underfunded reservation areas, face some of the worst health indicators in the country.
These disparities are not the result of biology but of institutional neglect, discriminatory practices, and lack of targeted investment in public health infrastructure. Even when insured, people of color often face bias in medical settings, receive substandard care, or are more likely to be dismissed or misdiagnosed.
3. Medicaid Expansion and the Geography of Health Inequality
The ACA attempted to address access disparities by expanding Medicaid eligibility to all individuals earning up to 138% of the federal poverty level. But after the Supreme Court ruled in NFIB v. Sebelius (2012) that states could opt out of this expansion, many Republican-led states refused to expand Medicaid.
As of 2024, 10 states still have not expanded Medicaid, leaving an estimated 2 million low-income adults in a “coverage gap” — too poor to qualify for ACA subsidies, but ineligible for Medicaid in their state.3 These states are disproportionately located in the South and include many of the nation’s poorest communities with the highest burdens of chronic illness.
This means that where you live in the U.S. can determine whether you have health coverage or not — a stark illustration of how healthcare in America functions as a postcode lottery rather than a universal right.
4. Mental Health and Behavioral Health Gaps
Mental health care is another domain where access is limited and heavily stratified. Despite growing public awareness of mental health needs, millions of Americans lack adequate access to psychiatric services, substance use treatment, and crisis care. Insurance coverage for mental health is often less generous than for physical health, despite legal requirements for parity.
The opioid crisis, surging suicide rates, and post-pandemic trauma have placed further strain on an underfunded system. Many counties across the U.S. have no practicing psychiatrists, and wait times for therapy or inpatient care can stretch into months — particularly for patients who rely on Medicaid or lack insurance entirely.
5. Gender Inequities and Reproductive Health
Women face unique barriers to care, particularly in reproductive health. Access to abortion, contraception, maternal care, and gender-affirming services is increasingly restricted by state legislatures, particularly after the Supreme Court's decision in Dobbs v. Jackson Women’s Health Organization (2022), which overturned Roe v. Wade.
These restrictions disproportionately affect low-income women and women of color, who may lack the resources to travel across state lines for care. Maternal mortality in the U.S. is higher than in any other wealthy country, with Black women three times more likely to die from pregnancy-related causes than white women.4
In many states, maternity wards in rural areas have closed due to cost-cutting, leaving pregnant people with few or no options for safe delivery close to home.
6. The Plight of the Working Poor and Gig Economy
Even for those who work full-time, access to affordable healthcare is not guaranteed. Many low-wage workers are employed by companies that do not offer benefits or offer coverage that is prohibitively expensive relative to their income. These include workers in fast food, retail, agriculture, hospitality, and gig economy platforms like Uber and DoorDash.
Gig workers, classified as independent contractors, are excluded from employer-sponsored coverage and must purchase individual plans, often without subsidies if their income fluctuates above ACA thresholds. Many simply forgo coverage — a rational decision when insurance premiums and deductibles can consume a third or more of their take-home pay.
7. Medical Debt and Financial Toxicity
Even those with insurance are not immune to medical debt, which is the leading cause of personal bankruptcy in the U.S.5 More than 100 million Americans — nearly 1 in 3 — carry some form of medical debt. This debt can affect credit scores, housing stability, and employment, creating a cycle of poverty reinforced by illness.
Hospitals and debt collectors routinely sue patients, garnish wages, or place liens on property. Many hospitals, including tax-exempt nonprofits, pursue aggressive collection practices despite receiving public subsidies and charitable contributions.
The psychological toll of debt — often referred to as “financial toxicity” — contributes to stress, depression, and even lower recovery rates from illness.
8. Immigrants and Exclusions from Public Programs
Immigrants, especially those who are undocumented, face substantial barriers to healthcare access. Federal law excludes undocumented immigrants from most public health programs, including Medicare, Medicaid (except emergency care), and ACA subsidies. Some states have extended Medicaid to undocumented children or pregnant women, but these programs remain limited.
As a result, many immigrants rely on community health centers, safety-net hospitals, or delay care until emergencies arise — a policy choice that is not only cruel but economically irrational, as it increases long-term system costs.
Conclusion: A System Designed to Exclude
The U.S. healthcare system’s inequalities are not incidental or accidental — they are the result of conscious policy decisions that have prioritized market logic over human needs. From the uninsured and underinsured to communities of color, rural populations, low-income workers, and immigrants, those on the margins are systematically excluded from the benefits of a system that should serve everyone.
Access to healthcare in the U.S. is not determined by illness or urgency, but by wealth, race, geography, and legal status. While other wealthy countries view healthcare as a right, the American model treats it as a privilege — one increasingly out of reach for the majority. Until this foundational injustice is addressed, reform efforts will remain partial, and millions will continue to suffer needlessly.
Footnotes
1. U.S. Census Bureau, “Health Insurance Coverage in the United States: 2023,” supra note 7.
2. Wilper et al., “Health Insurance and Mortality in U.S. Adults,” American Journal of Public Health, 2009.
3. KFF, “Status of State Medicaid Expansion Decisions: Interactive Map,” https://www.kff.org/medicaid/issue-brief/status-of-state-medicaid-expans...
4. Centers for Disease Control and Prevention, “Maternal Mortality Rates in the United States, 2021,” https://www.cdc.gov
5. KFF Health News, “100 Million People in America Are Saddled with Health Care Debt,” https://www.kff.org/health-costs/issue-brief/diagnosis-debt/
HOW POLICY AND LOBBYING SUSTAIN THE STATUS QUO
If the American healthcare system is so inefficient, so unequal, and so unpopular, why hasn’t it been fundamentally reformed? The answer lies in the enormous political power wielded by the healthcare industry, the fragmented nature of American governance, and the ideological framing of healthcare as a commodity rather than a right. Efforts to create a more equitable, universal healthcare system — whether through single-payer proposals, a public option, or stronger regulation — have repeatedly been blocked, diluted, or derailed by industry lobbying, partisan politics, and entrenched economic interests.
1. The Power of the Healthcare Lobby
The healthcare industry is among the most powerful lobbies in Washington. The combined forces of insurance companies, pharmaceutical corporations, hospitals, and physician groups have spent billions of dollars to influence legislation, sway public opinion, and protect their revenue streams.
According to OpenSecrets, healthcare interests spent over $700 million on lobbying in 2022 alone — more than any other sector, including defense or finance.1 The largest spenders include the American Hospital Association (AHA), America’s Health Insurance Plans (AHIP), and Pharmaceutical Research and Manufacturers of America (PhRMA). These organizations not only shape federal policy but also dominate state legislatures, where many critical healthcare decisions are made.
Lobbyists engage in a variety of tactics:
• Drafting legislation favorable to their clients
• Funding political campaigns through PACs and dark money groups
• Organizing “astroturf” campaigns that simulate grassroots opposition to reform
• Advertising against policy changes like drug price negotiation or a public option
Their goal is not to improve care but to preserve profitability and market share.
2. The Revolving Door and Regulatory Capture
Many policymakers and congressional staffers go on to lucrative careers in the healthcare industry, and vice versa — a phenomenon known as the “revolving door.” This practice blurs the lines between regulation and industry advocacy, leading to regulatory capture, where government agencies begin to serve the industries they’re supposed to oversee.
For instance, former heads of the Centers for Medicare & Medicaid Services (CMS) and the FDA have joined private equity firms, biotech companies, and insurance conglomerates. This creates a feedback loop where public policy is increasingly shaped by private interests.
3. Medicare for All: A Case Study in Lobbying Resistance
Proposals like Medicare for All — which would replace the fragmented multipayer system with a single, publicly funded plan — enjoy widespread public support, polling as high as 60–70% depending on the phrasing of the question.2 Yet the idea is consistently dismissed as “politically infeasible,” primarily due to opposition from the healthcare industry.
During the 2020 Democratic primaries, insurers, drug companies, and hospital groups launched a multi-million-dollar campaign under the name “Partnership for America’s Health Care Future.” This coalition ran ads attacking Medicare for All as too expensive, too disruptive, and a threat to “choice” — framing that played into Americans’ fears and misunderstandings about how the current system actually works.
These efforts successfully reframed the debate, shifting the Overton window away from single-payer proposals toward more incremental reforms like expanding subsidies under the ACA.
4. The Role of Partisan Polarization
American healthcare policy is also shaped by intense partisan polarization, which makes even modest reforms difficult to pass. The ACA itself, despite being based on a Republican-designed framework (Massachusetts’ “Romneycare”), faced unified GOP opposition, a barrage of lawsuits, and years of repeal efforts.
In recent years, state-level control over healthcare policy has deepened the divide. In Democratic-led states, efforts have been made to expand Medicaid, invest in public options, and protect reproductive health. In contrast, Republican-led states have passed anti-abortion laws, refused to expand Medicaid, and resisted ACA marketplace improvements — often at great cost to their own populations.
This political polarization ensures that the healthcare system is not only fragmented by design but also stratified by geography and ideology.
5. The Myth of the Free Market and American Exceptionalism
Ideologically, the U.S. has long resisted the idea of healthcare as a public good. Free market principles dominate American political discourse, even when markets clearly fail to deliver equitable outcomes. Politicians and pundits routinely equate government-provided healthcare with socialism, despite the fact that Medicare, Medicaid, and the Veterans Health Administration are all public systems that are popular and efficient.
This ideological resistance is reinforced by the narrative of American exceptionalism — the idea that the U.S. is unique and cannot follow the models of countries like Canada, Germany, or the U.K., despite the superior performance of those nations’ systems on almost every measurable health indicator.
6. Campaign Finance and Systemic Gridlock
The broader problem is that money dominates U.S. politics. The 2010 Supreme Court decision Citizens United v. FEC unleashed a flood of corporate spending in elections, allowing healthcare interests to fund candidates who support the status quo and punish those who advocate for reform.
Even well-meaning politicians face enormous pressure from donors and lobbyists to water down proposals or avoid controversial votes. As a result, the system incentivizes piecemeal reforms, complicated compromise bills, and regulatory tweaks that fail to address the underlying structure of healthcare delivery.
Conclusion: A Rigged Political Economy
The broken U.S. healthcare system is not a product of ignorance, lack of resources, or poor design — it is the intended outcome of a political economy in which corporate profits outweigh human lives. The powerful healthcare lobby, the revolving door, ideological polarization, and a campaign finance system awash in money all conspire to block meaningful reform.
Until this political machinery is confronted and dismantled, any attempt to fix the healthcare system will be met with fierce resistance. As the next section will show, other wealthy nations have made different choices — and their successes offer valuable lessons in what a just, equitable healthcare system can look like.
Footnotes
1. OpenSecrets, “Top Industries Lobbying in 2022,” https://www.opensecrets.org
2. Pew Research Center, “Majorities of U.S. adults favor expanding Medicare, government role in health care,” 2020, https://www.pewresearch.org
COMPARATIVE CASE STUDIES: LESSONS FROM OTHER WEALTHY NATIONS
To better understand the failings of the U.S. healthcare system, it is useful to examine how other wealthy, industrialized nations provide care. Countries like Canada, the United Kingdom, Germany, France, Japan, and Australia have developed universal healthcare systems that deliver better outcomes at a fraction of the cost, without leaving large swaths of their populations uninsured or drowning in medical debt. These comparative case studies show that high-quality, equitable healthcare is not only possible — it is the global norm.
1. Canada: Single-Payer Simplicity
Canada’s healthcare system, known as Medicare (not to be confused with the U.S. program of the same name), is a single-payer system funded primarily through taxes. Every resident has access to essential medical services, including physician and hospital care, without any out-of-pocket payment at the point of service.
The Canadian system is publicly financed but privately delivered: doctors remain independent practitioners and hospitals are largely non-profit institutions. Prescription drugs, dental, and vision coverage are handled separately — a gap that Canadian advocates are working to close.
Key features:
• Universal coverage
• No deductibles or copays for basic services
• Administrative costs are far lower than in the U.S.
• Per capita spending is about half of the U.S. level1
While wait times for non-emergency procedures are a challenge, overall satisfaction is high, and health outcomes (life expectancy, infant mortality, chronic disease management) are generally superior to the U.S.
2. United Kingdom: Public Provision through the NHS
The United Kingdom’s National Health Service (NHS) is a fully public system, where hospitals are owned by the government and doctors are paid public salaries or operate under government contracts. The NHS is funded through general taxation and provides nearly all services free at the point of use, including hospital stays, surgeries, maternity care, and mental health services.
Despite budget constraints and political wrangling, the NHS remains immensely popular and provides excellent care by global standards. It is consistently ranked among the best healthcare systems in the world for equity, efficiency, and access.2
Key features:
• Universal access
• Completely tax-funded
• Emphasis on preventive care
• Minimal administrative waste
Unlike in the U.S., no one in the U.K. worries about going bankrupt over hospital bills or navigating a maze of insurance plans to receive care.
3. Germany: Regulated Multi-Payer Solidarity
Germany operates under a social health insurance model that combines universal coverage with regulated competition. All residents must have health insurance, and about 90% are enrolled in non-profit “sickness funds”, which are heavily regulated and funded by income-based contributions shared by employers and employees.
The German system balances public oversight with private delivery. Patients have access to a wide choice of doctors and hospitals, and providers are paid based on negotiated fee schedules. The government sets global budgets for healthcare spending, which helps control costs.
Key features:
• Universal coverage
• Tight cost controls and price negotiation
• Low administrative costs
• Strong consumer choice and satisfaction
Out-of-pocket expenses are modest, and most people purchase supplemental insurance for things like dental care or private hospital rooms.
4. France: Generous Benefits with Universal Access
France’s system is frequently ranked among the world’s best. It combines universal public coverage with supplementary private insurance and emphasizes physician autonomy and patient choice. The state reimburses around 70% of most healthcare costs, and private insurers (often nonprofit) cover the rest.
France has a national health insurance fund, and the government tightly regulates prices for services and drugs. Doctors are independent, and there is strong access to both general practitioners and specialists.
Key features:
• Universal, mandatory coverage
• High patient satisfaction and provider autonomy
• Excellent preventive care
• Emphasis on home visits and community health
France spends significantly less per capita than the U.S., yet enjoys better health outcomes across nearly all metrics.3
5. Japan: Fee Regulation and Cultural Efficiency
Japan runs a universal healthcare system through a combination of employer-based and government-subsidized insurance. All citizens and residents are required to enroll in a plan, and the government sets strict fee schedules for services to ensure affordability and equity.
Doctors and hospitals are mostly private, but the pricing system is highly standardized and transparent. Japan has a high rate of medical visits, low infant mortality, and among the longest life expectancies in the world.
Key features:
• Compulsory enrollment
• Regulated pricing
• Low administrative costs
• Affordable out-of-pocket payments
Japan spends about 10% of GDP on healthcare — far less than the 18% spent by the U.S.4
6. Australia: Blended Public-Private Model
Australia operates under Medicare Australia, a universal system funded by general taxes and a specific Medicare levy. All residents have access to publicly funded healthcare, including hospital care and physician services, with the option to purchase private insurance for faster access or additional services.
The government negotiates fees, limits drug prices, and ensures equitable access across the country — even in rural areas. Preventive care is prioritized through national initiatives, and outcomes rival the best in the world.
Key features:
• Universal public baseline with optional private insurance
• Strong primary care network
• Controlled drug pricing
• Low cost-sharing for patients
Australia shows that public systems can coexist with private options without losing equity or efficiency.
What These Systems Have in Common
Across all these examples, certain themes emerge:
• Universal coverage as a foundational value
• Public oversight of financing and/or pricing
• Transparency and simplicity
• Lower administrative costs
• Focus on preventive and primary care
• Access determined by need, not wealth
In contrast, the U.S. remains an outlier, treating healthcare as a commodity and placing financial barriers between patients and care. It is the only wealthy country where medical debt is common, routine care is delayed due to cost, and access is tethered to employment or income.
Conclusion: A World of Better Options
These case studies debunk the notion that the U.S. must choose between quality and affordability, or between innovation and access. Other wealthy nations have built systems that are fairer, cheaper, and more effective, without sacrificing medical excellence. Their success is not due to any unique cultural characteristic or advantage — it is the result of political will, public investment, and shared values.
America has the resources, knowledge, and talent to build such a system. What it lacks — at least so far — is the political courage to challenge the entrenched interests that benefit from the current dysfunction.
Footnotes
1. Canadian Institute for Health Information (CIHI), “How Canada Compares,” https://www.cihi.ca
2. Commonwealth Fund, “Mirror, Mirror 2021: Reflecting Poorly,” supra note 2.
3. World Health Organization, “France: Health System Review,” https://eurohealthobservatory.who.int
4. OECD Health Statistics, “Health Spending,” https://data.oecd.org/healthres/health-spending.htm
THE CONSEQUENCES: HEALTH OUTCOMES AND ECONOMIC BURDEN
The fragmented, inequitable, and profit-driven structure of the American healthcare system has far-reaching consequences — not only for individuals who face delays, denials, and financial ruin, but also for society as a whole. Despite spending more than any other nation on healthcare, the United States consistently ranks near the bottom among developed countries in terms of health outcomes, while imposing a severe economic burden on families, businesses, and the national economy.
1. Poor Health Outcomes Despite High Spending
The United States lags behind its high-income peers on nearly every major indicator of population health. According to the Commonwealth Fund, which regularly compares health system performance across countries, the U.S. ranks last overall among 11 wealthy nations, including the U.K., Germany, France, Canada, Australia, and Japan.1
Key metrics where the U.S. falls short include:
• Life expectancy: As of 2023, U.S. life expectancy was approximately 76.4 years — lower than all peer nations, and declining in recent years due to COVID-19, chronic disease, and drug overdoses.
• Infant mortality: The U.S. has one of the highest infant mortality rates among wealthy nations — nearly double that of countries like Japan and Finland.
• Maternal mortality: U.S. maternal deaths have risen in the past decade, particularly among Black women, and far exceed rates in Europe and Canada.
• Chronic disease: Americans experience higher rates of diabetes, obesity, heart disease, and hypertension than their international counterparts — and often receive less effective long-term care.
• Preventable hospitalizations and deaths: Many deaths from asthma, diabetes, and infections could be prevented with timely outpatient care, but are not — especially among the uninsured and underinsured.
These poor outcomes are not the result of medical incompetence or technological inferiority. The U.S. has some of the best doctors, hospitals, and research institutions in the world. Rather, the problem lies in the uneven distribution of access and a system that focuses on expensive interventions instead of prevention and continuity of care.
2. Medical Debt and Household Financial Ruin
One of the most distinctive — and devastating — features of the U.S. system is the financial hardship it imposes on individuals and families. Unlike other wealthy nations where healthcare is mostly free at the point of service, Americans routinely face crippling out-of-pocket expenses, even with insurance.
• According to KFF, more than 100 million people in the U.S. carry medical debt — many of them with employer-based insurance.2
• Over 40% of adults have delayed or avoided medical care due to cost.
• One in five Americans with insurance still receives surprise medical bills, especially after emergency visits or procedures involving out-of-network providers.
Medical debt leads to credit damage, wage garnishment, housing instability, and bankruptcy. Even short hospital stays can result in bills exceeding tens or hundreds of thousands of dollars. Nonprofit hospitals have been found suing patients, placing liens on homes, and garnishing wages, in direct contradiction of their charitable missions.
The financial toxicity of the American healthcare system is itself a public health crisis — causing stress, depression, poorer recovery rates, and even increased mortality among debt-burdened patients.
3. Economic Costs to Employers and the Broader Economy
Employers in the U.S. bear a significant portion of healthcare costs, which puts American businesses at a competitive disadvantage globally. Employer-sponsored insurance premiums have risen more than 50% over the past decade, and in 2023, the average cost for a family plan exceeded $23,000 per year — with employees responsible for nearly $7,000 of that cost out of pocket.3
This places a growing burden on small businesses, discourages entrepreneurship, and contributes to wage stagnation, as more compensation is diverted into healthcare premiums rather than salaries.
Large employers often struggle to negotiate lower prices due to market consolidation among hospitals and insurers. Moreover, the administrative complexity of the system — with multiple insurers, billing codes, and regulatory environments — adds to overhead and reduces economic efficiency.
From a macroeconomic standpoint, the U.S. spends nearly 18% of its GDP on healthcare, compared to 10–12% in peer countries. This is a massive resource drain, diverting funds from infrastructure, education, housing, and social programs that could improve public health more broadly.
4. Labor Market Distortions and “Job Lock”
Because health insurance in the U.S. is largely tied to employment, many workers feel compelled to stay in jobs they dislike or delay entrepreneurship to avoid losing coverage. This phenomenon, known as “job lock,” reduces labor mobility, productivity, and innovation.
Moreover, the gig economy — which lacks employer-sponsored benefits — has expanded rapidly, leaving millions of workers without affordable options. The ACA was meant to address this, but its reliance on private insurance markets and high deductibles often leaves people underinsured.
A universal or single-payer system, by contrast, would decouple healthcare from employment, enabling people to change jobs, start businesses, or take care of family members without sacrificing their health security.
5. Racial and Geographic Disparities in Outcomes
As discussed in Section 6, the U.S. healthcare system disproportionately fails communities of color, low-income populations, and rural residents. These disparities are not only morally unacceptable — they also result in higher overall system costs due to delayed treatment, unmanaged chronic illness, and avoidable hospitalizations.
Rural hospitals are closing at an alarming rate, leaving many Americans without access to emergency care within a safe distance. Meanwhile, urban safety-net hospitals are overwhelmed, underfunded, and burdened by treating large uninsured populations.
These geographic and racial disparities drive up healthcare costs for everyone, as they lead to more expensive care in the long run and erode the overall health of the population.
6. National Security and Pandemic Vulnerability
The COVID-19 pandemic exposed the dangerous weaknesses of the U.S. healthcare system. Millions of people lost both their jobs and their insurance at a time when access to care was most critical. Testing, treatment, and vaccine distribution were uneven, hampered by a fragmented system and political infighting.
Public health infrastructure — underfunded for decades — struggled to respond to the crisis. The lack of universal coverage meant that many people delayed seeking care due to cost, contributing to avoidable deaths and transmission.
A better-prepared and more equitable system could have saved hundreds of thousands of lives, mitigated economic damage, and maintained public trust during the crisis.
Conclusion: The Human and Economic Cost of a Broken System
The consequences of America’s healthcare dysfunction are measured not just in spreadsheets and economic forecasts, but in real human suffering — people who die from treatable conditions, families bankrupted by illness, children growing up without access to routine care, and workers trapped in jobs for fear of losing coverage.
At the same time, the U.S. pays a massive economic penalty for this broken system — in lost productivity, higher business costs, social inequality, and preventable disease burden. No other country spends so much to achieve so little.
As the final section will explore, these outcomes are not inevitable. With political courage, structural reform, and a reorientation toward justice and equity, the U.S. can build a system that serves everyone — not just the wealthy and the insured.
Footnotes
1. Commonwealth Fund, “Mirror, Mirror 2021: Reflecting Poorly,” supra note 2.
2. KFF Health News, “100 Million People in America Are Saddled with Health Care Debt,” supra note 33.
3. KFF Employer Health Benefits Survey 2023, https://www.kff.org
CONCLUSION AND POSSIBILITIES FOR REFORM
The United States remains the wealthiest country in the world, yet it fails — spectacularly and uniquely — to provide healthcare as a right to its citizens. The paradox is unmistakable: a nation with the world’s most advanced medical technologies and the highest healthcare spending delivers inferior health outcomes, persistent inequality, and widespread financial suffering. The American healthcare system is not broken in a mechanical sense — it is broken in its values, design, and purpose. It works as intended for shareholders and industry executives. It fails the people who depend on it.
This essay has explored the many dimensions of this failure: the structure of private insurance and its misaligned incentives; the rampant cost inflation driven by profit-seeking hospitals, insurers, and pharmaceutical companies; the inequality of access determined by income, race, and geography; the power of industry lobbying to resist change; and the unnecessary human and economic suffering that results. Each of these problems is daunting. Yet they are not insurmountable.
1. Learning from Other Nations
Other wealthy countries have shown that universal, equitable, and efficient healthcare systems are not only possible but the global standard. Whether through single-payer systems like Canada’s, publicly provided systems like the U.K.’s NHS, or tightly regulated multi-payer models like Germany’s and Japan’s, these countries share a core belief: healthcare is a right, not a commodity.
The U.S. has no shortage of resources, medical expertise, or technological capability. What it lacks is the political will to reject a status quo that is exploitative and unjust. American exceptionalism — long used as an excuse for inaction — should become a call to lead the world in creating the most humane and effective healthcare system, not the most expensive and inequitable one.
2. Pathways to Reform
There is no single fix for America’s healthcare crisis, but there are clear, evidence-based pathways to meaningful reform. These include:
• Medicare for All (single-payer): A national health insurance program that covers all residents with comprehensive benefits, eliminates private insurance overhead, and pays providers directly at negotiated rates. Though politically challenging, it offers the most complete solution to coverage, cost, and equity.
• Public Option: Allowing individuals to buy into a publicly administered health plan — such as Medicare — could reduce costs through competition and provide a non-profit alternative to private insurance. It would be an incremental but meaningful step toward universal coverage.
• Expand and improve Medicaid: Closing the coverage gap by mandating expansion in all states, increasing provider reimbursement, and integrating mental health and long-term care more effectively.
• Drug price negotiation and regulation: Empowering Medicare and other public programs to negotiate drug prices directly, and implementing global reference pricing for brand-name drugs.
• End surprise billing and limit out-of-pocket costs: Enforcing strong protections against out-of-network charges, setting caps on deductibles and copays, and improving cost transparency.
• Invest in primary care and prevention: Shifting resources from high-cost specialty care and emergency interventions to community-based primary care, preventive health, and chronic disease management.
• Address social determinants of health: Expanding access to housing, nutrition, education, and clean environments — all of which affect health outcomes more than clinical care.
These reforms vary in scope and feasibility, but they share a commitment to reshaping the system around people, not profits.
3. The Role of Political Mobilization
To overcome the entrenched opposition of industry lobbyists and ideological resistance, reform will require sustained grassroots mobilization, coalition-building, and electoral accountability. Physicians, nurses, patients, unions, and employers must unite in demanding change. The movement for healthcare justice cannot be siloed; it must be part of a larger push for economic equity, racial justice, and democratic renewal.
Political leaders who support bold reform need to be elected, supported, and held accountable. Voters must reject fear-mongering campaigns funded by industry groups and demand transparency and fairness. Change will not come easily, but it will come if the public demands it — as it has in every other advanced democracy.
4. A Moral Imperative
At its core, the question of healthcare in America is not just technical or economic — it is moral. Do we believe that everyone deserves to live with dignity, to receive care when they are sick, and to be protected from ruin because of illness? Or do we continue to accept a system where some receive concierge medicine while others ration insulin, skip cancer screenings, or die waiting for care?
Healthcare is not merely a policy issue — it is a reflection of our national values. It reveals who we care about, whose lives we deem worthy, and what kind of society we wish to build. The current system tells a bleak story: that profits matter more than people, that inequality is natural, and that suffering is a private problem. But that story can be rewritten.
Conclusion: A Call to Action
The United States can no longer afford — economically or ethically — to sustain a healthcare system that serves only the rich. The time for incremental tweaks and symbolic gestures is over. What is needed is structural transformation, driven by a clear vision of health as a public good and a human right.
Such a transformation will not be easy. It will challenge powerful interests and disrupt established institutions. But the alternative is continued injustice, inefficiency, and needless death.
The wealth of this nation is not in its corporate balance sheets or GDP statistics. It is in the lives of its people. It is time to build a healthcare system worthy of that wealth — one that guarantees care, compassion, and dignity for all.