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Why is Healthcare so Expensive: Part Six

We’ve come to the end of our blog series answering the million-dollar question, “why is healthcare so expensive?” It’s a question that has several answers, and our blog series could never address every reason healthcare is expensive. To be frank, it’s a flawed system from top to bottom and requires significant changes. This is a complicated topic that needs far more than a few blogs to explain. 

Yet, there may be a deeper reason why the cost curve continues to point upward. 

 

Greed and Refusal to Change

In an interview on the Race to Value podcast, Stephen Klasko, President and CEO of Jefferson Health, shared this Upton Sinclair quote:

 

“It is difficult to get a man to understand something when his salary depends on his not understanding it.” 

 

It's scary how appropriate this is for healthcare. One of the main reasons healthcare is so expensive is because so many people are cemented in the current system. They don’t want to see change that may lead to a decrease in their corporate revenues and therefore salaries. Is everyone in healthcare like that? Certainly not. Individuals are working to reduce healthcare costs, even if it means reduced profit.

 

Champions of Change

These mavericks going against the status quo have the odds stacked against them.  Some even face repercussions, which then discourages others from trying to change healthcare for the better. A perfect example of this is North Carolina Treasurer, Dale Folwell. He challenged hospitals to accept lower payments by implementing a reference-based pricing model (paying hospitals 175%-225% of what Medicare reimbursed them), and the hospitals retaliated by using their political power to take him down and gave their endorsements to his competitor. Too often when someone stands up against the existing system and tries to push reasonable change, they pay the consequences. This story has a happy ending though: Folwell won his re-election and will hopefully continue to fight for lower payments and transparent pricing.

Persistence and courage are two key ingredients needed if we want to change the healthcare system. One of my favorite healthcare cost reform champions is Rep. Katie Porter, whose weapon of choice is a whiteboard. Porter has gone viral more than once for the way she calls out Pharma executives on the ridiculous costs of their drugs, their salaries, and the overall extreme profits they make by grossly overpricing prescription drugs. These videos are almost living examples of the Upton Sinclair quote at the beginning of this blog. Hearing after hearing, we see Porter grill executives, and all they can say is, “I don’t know” when asked why they increased drug costs, why they received a big bonus, and so on. Despite their best efforts to stay in the dark and continue to enjoy the rewards of their unawareness, Porter shines a glaring light on the immoral ways these companies and executives profit off the people they’re meant to help.

Is expensive healthcare costs just a greed problem? No, there are outdated systems in place, policies that aren’t effective, and even individual consumer decisions that lead to costly care. However, it’s fair to say greed is a central pillar holding up high healthcare costs.

 

Final Thoughts

Advocates are working to reduce healthcare costs, but even if someone can’t be a Rep. Katie Porter or Dale Folwell, there are other ways to make a difference. Doctors and hospitals can put in place better administrative systems to reduce waste. Patients can use tools that are available to shop for healthcare and force providers to have competitive pricing. Executives at healthcare companies and hospitals can do their part to not engage in price gouging. 

Expensive healthcare costs are bad news for patients, which is bad for everyone because in the end we are all a patient at some point. The main focus of U.S. healthcare reform should be to lower individual patient costs since it’s the patient at the end of the day whose life and wellbeing relies on quality healthcare they can afford.

I’m excited to see how patient advocates, healthcare reformers, digital health innovators, and people who are just plain fed up with expensive healthcare continue to put pressure on the big players to decrease healthcare costs and improve quality. In the meantime, we will continue working to make healthcare easy to find, easy to understand, and most importantly, easier to afford.

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