Healthcare Expenditure in the U.S. Is High

May, 2021 - By WMR

The U.S. does not have a universal, free healthcare facilities like other developed countries and is also one of the expensive healthcare systems in the world.

According to Organisation for Economic Co-operation and Development (OECD), in 2018, the U.S. spent approximately 17% of gross domestic product (GDP) on healthcare. As per National Healthcare Expenditure Accounts (NHEA), the expenditure on the U.S. healthcare increased by 4.6% in 2019, which accounted for US$ 3.8 trillion or US$ 11,582/person.

U.S. healthcare system is a combination of both publicly and privately funded programs. Most hospitals and clinics in the U.S. are privately owned. To add to this, most insured Americans are mainly covered under employment-based private insurance. Whereas, only 30% Americans are covered by Medicare, Medicaid, and Children’s Health Insurance programs- the three publicly funded insurance programs.

The Affordable Care Act (ACA), commonly known as Obamacare, brought a change in the healthcare system in the U.S. This act was signed into law on March 23, 2010 by President Barack Obama. This act is a significant step taken by the U.S. government which requires every American to have health insurance and even provides assistance to those who fails to afford any plan. As per Obamacare enrollment stats, 2020, approximately 8 million people signed up for ACA coverage in2019. Out of which, nearly 87% are getting some form of cost assistance. It is to be noted that expansion of Medicaid under Obamacare has possibly saved lives at less than US$ 900,000/life saved.

A study reveals that high medical costs in the U.S. have led to bankruptcy for 1/4^th of senior citizens. Although, the U.S. leads in medical innovations but Americans cannot even afford high quality care. For instance, specialized scans like computerized tomography (CT), and Magnetic Resonance Imaging (MRI) are the most expensive in the world, which is in fact double the OECD average. Another important factor to be noted is that the American healthcare system is the least accessible and efficient one among developed countries.