The deranged murder of a health plan executive has prompted lots of discussion about the US health system, in particular why it is so expensive. Most people don’t have complaints about their care, satisfaction rates are typically very high for private health plans. But then as I noted in an earlier post, most Americans don’t use much health care. Our high costs are pretty simple at root–we pay providers of health care services and products, like drugs and medical devices–a lot more than other countries pay them and we have a lot of people in poor health, partly because of age but also because of lack of personal responsibility in regard to diet, exercise, smoking, and drug and alcohol use.
And government plays a big role by heaping useless bureaucratic requirements on providers and health plans. See this chart making the rounds. It shows the rise in medical costs over time, note the particularly sharp rise following the passage of the laughable Affordable Care Act by Obama in the 2009-2010 period. All the mandates and rules coming out of that law did nothing to make care affordable. (ZH Image)
But another reality is that while consumers may be angry about health care costs and access, there is very little denied care. A few anecdotes are used to obfuscate the truth that very few claims for health care are denied. And when they are it is usually because the service is inappropriate or not covered. If everything every patient wanted, whether it was appropriate care or not, was just paid for, the cost of health insurance would be even higher. And for those who think the consumer in the US pays a lot of the bills, look at this chart. Patients in the US have among the lowest proportion of out-of-pocket expense in the world. It is always important to understand facts before reacting. (OWID Chart)
Most importantly, we have great outcomes in the US. If you have cancer or another serious illness, the US is where you want to be treated and wealthy people from around the world come here for that treatment.
The Healthy Skeptic is a website about the health care system, and is written by Kevin Roche, who has many years of experience working in the health industry. Mr. Roche is available to assist health care companies through consulting arrangements through Roche Consulting, LLC and may be reached at 
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A small observation I would make is that MDs make a lot of money, in part, because they owe a lot of money. If our sadly unfocused state and federal governments would make medical school free (and completely merit based) it would free many new MDs to pursue general practice instead of high paying specialties, and some new MDs might find it preferable to practice in geographic areas that are underserved — and where medical staff are paid less. Reimbursement programs at the state level are good, but don’t seem to attract many MDs. As federal spending goes, it wouldn’t require that much money. Starting a professional career hundreds of thousands of dollars in debt is sure to distort the system.
While we’ve never had a properly-coded claim denied by Medicare quite a few claims made to private insurance companies have been initially denied but then later paid after the denial was challenged. Does the data in this report include claims initially denied? How many elderly sick people are able to effectively challenge these initial denials on their own?
the whole topic of claims denials is complex. Some are simply it isn’t a covered benefit. Some are issues about whether it is the appropriate treatment for the patient. Doctors are wrong sometimes and sometimes are just giving in to something because a patient is asking for it. If insurers literally paid for everything, health insurance would obviously cost far more for everyone. There are plans that are too aggressive, but they tend to lose appeals and to be chastised by regulators.