Category Archives: Health Economics

High Health Care Costs: Plenty of Blame to Go Around

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Zack Cooper, NY Times, 5/4/26. This Is the Biggest Culprit for High Health Care Spending.

An excerpt:

Responding to the wrongdoing of insurers is imperative, but it won’t do much to address the unsustainable cost of health care. We are directing our anger at the part of the system that is most visible and frustrating (insurers’ restrictions on care) while ignoring the part of the health system that is most responsible for high costs and economic pain: hospital prices…

Hospitals in the United States earn $29,000 on average for a replacement covered by private insurance and $16,000 for one covered by Medicare. In Germany, the public system of nonprofit insurers, which covers 90 percent of the population, pays hospitals $9,400.

Hospital prices are the leading driver of the 320 percent increase in insurance premiums that Americans have experienced over the past 25 years. Since 2000, prices at hospitals have grown faster than prices in virtually any other sector of the economy. They have grown three times as fast as inflation and twice as fast as prescription drugs and doctor visits.

The reason hospital prices are so high: hospitals’ accumulation of market power, which brings them more bargaining heft when they negotiate prices with insurers. Since 2000, there have been more than 1,300 hospital mergers among the nation’s approximately 5,000 hospitals. When hospitals that were once competitors merge, prices go up, often by double-digit percentages, with no measurable improvement in patient outcomes. Even though we rely on competition to determine hospital prices, 21 percent of hospitals are effectively monopolies — they have no competitor within a 30-minute drive — and an additional 24 percent face only one competitor…

If hospital prices are such a key driver of rising costs, why aren’t elected officials doing more about them? Partly the answer is politics. Hospitals are the largest or second-largest employer in many counties in America, and a formidable lobbying force — spending more than $100 million annually in Washington, often more than health insurers spend, to protect their interests. Politicians who represent places with dominant hospital systems are not eager to pick a fight with these institutions. Moreover, when an insurer denies your claim, you know it immediately. When a hospital merges and its prices go up, the harms — slower overall economic growth and job losses outside the hospital sector — are real but diffuse…

Holding that tension between the immense good that hospitals do and the economic harm their market power creates is what it will take to address the rising cost of health care.

In reaction to this editorial, the American Hospital Association Blog responded on May 6, 2026: Setting the Record Straight: Three Ways the Hospital‑blame Narrative Gets it Wrong

“Let’s start with a basic point — the entire concept of hospital “prices” is flawed. Hospitals are largely price takers, not price setters. Government programs like Medicare and Medicaid set rates administratively. But Medicare reimbursement continues to lag behind inflation — covering just 83 cents for every dollar spent by hospitals in 2023 — resulting in over $100 billion in underpayments. Needless to say, government rates fall far short of covering hospitals’ actual costs. Likewise, commercial insurers aggressively negotiate payment terms with hospitals. In many cases, these are large, vertically-integrated companies that hold significant shares in their markets. With that kind of market power, commercial insurers do not simply accept the numbers that hospitals offer and then sign on the dotted line. Thus, the notion of hospital “prices” does not reflect how those purposed “prices” are set in the real world…But here’s the reality: Over the same time frame, commercial insurance premiums have increased more than hospital prices…premiums are primarily growing due to an increased need for services: People are sicker and they need more care.”

“The essay also … appears to excuse commercial insurers’ role in deciding to raise their own premiums because they are in the “business of making money…The essay argues that policymakers must be harder on hospitals.”

“The essay also fails to ask another important question: Why are hospitals forced to raise their “prices”?…In 2025, total hospital expenses grew 7.5%, more than twice the rate of growth in hospital prices. Costs increased in every major category — workforce, drugs, medical supplies, and more. Hospital expenses also increased because of increased patient complexity; growing uncompensated care; continued government underfunding; changes in the policy landscape; and the many commercial insurer tactics like prior authorization and improper denials that the essay observes.”

My take: There are lots of reasons for high healthcare costs. There are not simple fixes nor enough incentives to make changes.

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Understanding the Business of Medicine and Downstream Consequences

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There are several insightful and concise articles that highlight the reasons for increased U.S. healthcare costs as well as challenges: corporitization of health care, private equity, and health-harming corporations.

A Mollica, AW Mathews. WSJ 4/6/26: Why the U.S. Spends So Much on Healthcare

An excerpt:

“Americans spend more on healthcare than anyone else in the world. Just insuring a family here costs nearly $27,000 a year, enough to buy a car. The main cause: Prices are far higher in the U.S. for the same medical products and services, from surgeries to drugs.

American patients have also been using more care recently, including costly hospital treatment and expensive new drugs for weight loss.”

  • Prescription drugs cost a lot more in the U.S.
  • Big hospitals can charge higher rates because of consolidation
  • The U.S. spends far more than other countries on administration
  • Labor costs are higher
  • Americans are using more healthcare

LP Casalino. N Engl J Med 2026;394:1249-1251. Physicians, Corporatization, and the Unmeasured Quality of Care

This article notes that historically, in economic experiments, physicians have acted more altruistically than members of the general population and this results in better outcomes for patients. However, “extreme size and corporate ownership are leading to the widgetization of care. It is difficult or impossible for a large organization, even one with well-intentioned leaders, to avoid treating its physicians and staff like interchangeable widgets whose behavior can be monitored and controlled to maximize profit….Physicians who feel like widgets are more likely to behave like widgets…there is evidence that corporatization is leading to higher prices, higher health care spending, and unchanged quality or poorer quality.”

R Yearby, M Alson. N Engl J Med 2026;394:937-940. Private Equity’s Transformation of American Medicine — Implications for Health Equity

An excerpt:

“Accumulating evidence presented in scholarly articles and government reports indicates that the proliferation of PE in health care has reduced access to care, increased costs, and compromised quality of care…PE firms often extract value using tactics that obscure a health care system’s profitability while maximizing financial returns for the firm and its investors. These tactics include sale–leaseback transactions, in which facilities are sold to entities affiliated with a firm and then leased back to the seller at inflated rates. Another strategy is dividend recapitalization, whereby fund managers take on additional debt to pay partners instead of putting money toward staff, critical maintenance, or supplies…

PE investors achieve cost savings by laying off workers, reducing salaries and the number of full-time employees, assigning services previously provided by physicians to other health care professionals, and cutting critical but low-profit services…

Cream skimming — selectively caring for healthier (i.e., lower-cost) patients — is another widely used PE practice. This tactic limits access to care for older and sicker patients, leaving them worse off after PE investment.2 Despite this behavior, hospital acquisitions by PE firms have been associated with increases in emergency department deaths and deaths after emergency surgeries.3,5“

Consortium of the Center to End Corporate Harm, University of California, San Francisco. N Engl J Med 2026;394:1231-1237. Corporate Vectors of Chronic Disease — Using Internal Industry Documents to Craft Counterstrategies

An excerpt:

“Health-harming corporations use common tactics to corrupt scientific data, including influencing research questions, attacking and discrediting independent science and scientists who do not support the industry’s position, suppressing scientific data on the health harms of their products, and sponsoring research that downplays those harms.27,28

For example, the primary U.S. manufacturers of perfluoroalkyl and polyfluoroalkyl substances (PFAS) — DuPont and 3M — used multiple tactics to downplay evidence of PFAS toxicity, including successfully suppressing for more than 20 years internal studies showing adverse effects of PFAS…

Corporations have various tactics for influencing the public’s beliefs about their products’ benefits and harms. These include sophisticated and pervasive advertising and marketing campaigns; use of public relations companies, front groups, and think tanks; and capture of consumer groups.

For example, opioid manufacturers deployed particularly insidious advertising strategies for marketing opioids to vulnerable populations, such as recruiting youth coaches and school nurses to encourage opioid use by children, developing unbranded initiatives encouraging adolescents to ask clinicians for pain medications, promoting “safe opioids” for untreated pain in women, and distorting policy discussions of unmet needs for pain medication…

Make America Healthy Again initiative highlights the roles of toxic chemicals and pesticides, ultraprocessed foods, and corporate influence on science in harming children’s health.47 But…the administration has appointed former lobbyists and scientists from the chemical and petroleum industries to lead EPA offices responsible for regulating air pollution, toxic chemicals, and pesticides48,49 — and plans to eliminate regulatory and other measures, which will lead to increased exposure to toxic chemicals and air pollutants, thereby increasing child health risks.50,51 

My take: Poorly-regulated capitalism is not good for patients. Insurers, private equity, hospitals, pharmaceutical companies and many providers may prioritize profits over care.

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Humor: MAHAspital

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This satire is particularly amusing for those who have watched “The Pitt.” Unfortunately, many of the health care policy changes under this administration will cause harm here and throughout the world for decades.

3/14/26 SNL: MAHAspital

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Reimbursement Reduction for Gastroenterology Practices

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JA Busam, ED Shah. Clin Gastroenterol Hepatol 2026; 24: 281-284. A Decade of Decreasing Reimbursement Strains Gastroenterology Practices and Threatens Their Independence

Background: “Over the past decade, a remarkable number of independent community gastroenterologists became part of larger groups, primarily due to financial concerns. Although the number of gastroenterologists increased between 2012 and 2020, the number of associated practices decreased by more than 650 (14%), with the number of physicians practicing in groups of less than 10 decreasing by nearly 1500 (35%).1 Simultaneously, the number of self-employed physicians decreased,2 while the number of hospital-employed and private equity affiliated physicians increased.3,4 Surveys of practices engaged in such consolidative behavior most often cite financial uncertainty given increased costs, decreased revenues, and continuing regulatory pressures, along with personal financial gains, as important motivations.5,6“

Methods: The authors examine how “Medicare reimbursement has affected independent, community practices over time, with a particular emphasis on hourly rates to account for any efficiencies in endoscopic procedure times over the past decade…[using] multiple datasets from the Centers for Medicare and Medicaid Services (CMS).”

Key finding:

  • “All major endoscopic procedures investigated brought in decreased associated professional revenue between 2014 and 2024 per unit billed. Most procedures saw a reduction between 30% and 40% in the amount of cash brought into the practice per procedure”
  • “Although independent practices faced tough decisions due to these trends, other health care stakeholders benefited. Concurrently, facility revenues, medical complexity,13 overall health expenditures,14 drug prices,15 and pharmacy benefit manager profits16 all increased, the latter by approximately 80%”

My take: This small study shows how “independent gastroenterology practice reimbursement decreased substantially since 2014 despite increasing patient complexity and capital flows into health care, threatening the viability of many community practices.” 

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Health Insurance Improves Survival and Outcomes in Patients with Liver Disease

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In a previous blog post in 2019, it was noted how the IRS proved that having health insurance saved lives (How The IRS Proved That Health Insurance Saves Lives); just receiving a letter recommending getting coverage reduce deaths by ~1 in 1600. Another study in 2014 (in Massachusetts) showed that for “every 830 additional people who got insurance under Massachusetts’ health reforms prevented roughly one death.” If this were extrapolated to broaden health care coverage to everyone in the U.S this could amount to preventing 20,000-45,000 deaths per year (A Leading Cause of Mortality in U.S…. and 45,000 Unnecessary Deaths Per Year).

A new study shows how important ACA expansion has been to improved liver outcomes:

TL Walker et al. Clinical Gastroenterology and Hepatology 2026; 24: 312 – 327. The Affordable Care Act Improves Access, Survival, and Racial Disparities of Patients With Liver Disease: A Systematic Review

This review identified twenty-seven studies that met inclusion criteria across 4 clinical categories: hepatitis C virus (n = 4), liver transplantation (n = 10), hepatocellular carcinoma (n = 9), and cirrhosis or CLD (n = 5).

Key findings:

  • Twenty-three out of 27 studies showed patients benefited from the ACA, which notably included improved liver-related mortality in Medicaid-expansion (ME) states.
  • “Difference-in-difference analyses showed liver transplantation listing increased by 1.8% to 6.0% in ME vs NME states; early-stage hepatocellular carcinoma (HCC) diagnosis increased by 5.4%, and cirrhosis-related mortality rose more slowly in ME states (0.5–1.0 per 100,000 vs 1.4–10.4 per 100,000).”

From Related summary: ACA expansion linked to better liver disease outcomes (GI & Hepatology News):

  • HCV studies showed improved access to direct-acting antiviral therapy in ME states. Expansion states consistently reported higher direct-acting antiviral prescription rates and Medicaid reimbursement levels compared with NME states.
  • HCC survival outcomes improved more consistently in ME than in NME states after ACA implementation (median overall survival, 7.3 months versus 4.5 months, respectively).
  • Of the five studies that examined chronic liver disease and cirrhosis, ME was associated with lower emergency department readmissions, shorter hospital stays, and reduced hospitalization costs.

My take: The study findings, while not surprising, quantifies some of the improvements in survival and outcomes for patients who gained access to health insurance.

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    Gastroenterology and the Rise of Private Equity Investments

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    TA Brenner et al. Clin Gastroenterol Hepatol 2026: 24: 7-9. Geodemographic Trends in Private Equity Acquisitions of US Gastroenterology Practices: An Analysis of Transactions From 2013 to 2023

    An excerpt:

    “The combination of high-volume procedures, strong ancillary revenue streams, and opportunities for outpatient consolidation has made gastroenterology a prime target for PE-backed investment. For many gastroenterologists, this trend is no longer theoretical—it is local, visible, and shaping the landscape of everyday practice.”

    “Between 2013 and 2023, PE firms acquired 114 outpatient gastroenterology practices, encompassing 1169 clinical sites nationwide…That includes 854 clinics, 266 endoscopy centers, and 49 infusion centers. Collectively, these sites employed approximately 2675 physicians and advanced practice providers. In total, around 14% of all gastroenterology clinical sites nationwide are now affiliated with PE-backed platforms.”

     (A) Trend in private equity acquisitions of gastroenterology practices (red)
    and gastroenterology clinical sites (blue) by year.

    “PE firms are less likely to invest in gastroenterology practices located in the poorest communities… Practices in zip codes with the lowest income levels were about 60% less likely to be acquired than those in wealthier areas (aRR, 0.37; 95% CI, 0.31–0.45; P < .001)…PE firms tend to prioritize markets with strong commercial payer mixes and higher rates of elective procedures, steering clear of areas with high Medicaid penetration or large numbers of uninsured patients.”

    Key Points:

    • “First, consolidation is accelerating…Even if you are not interested in selling, you may need to compete with PE-backed groups that have more capital, better tech infrastructure, and stronger payer contracts”
    • “Second, staying independent may become more difficult. As regional consolidation increases, remaining unaffiliated could put independent practices at a disadvantage. PE-backed platforms often negotiate better rates with commercial insurers and have the scale to invest in centralized billing, marketing, and compliance.”
    • “Third…If PE firms avoid lower-income or rural areas, gastroenterology access could become more uneven and more challenging to sustain in underserved regions.”
    • “Studies in other specialties suggest that practices owned by PE firms often face changes in staffing, autonomy, and productivity expectations. Physicians may experience higher pressure to perform more procedures, see more patients, or adopt system-wide workflows they did not design.”

    My take: PE acquisitions are affecting broad areas of healthcare. However, they do not seem to result in improvement in patient care or physician satisfaction.

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    Why Corporatization Occurs in Health Care -What Motivates Hospitals

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    S Lipstein. NEJM 2025; 393: 1249-1251. Insight into Corporate Governance — What Motivates Hospitals and Delivery Systems

    This commentary provides a useful perspective on how hospitals view consolidation of health care. This article is one of many on the topic of corporatization of health care in recent NEJM issues. The author pushes back on the notion that the motivation is purely financial. And, the author argues that a lot of the concerns with poor outcomes/life expectancy despite high expenditures in health care actually are related mainly to poverty level, gun-related mortality, and public social services expenditures.

    Here’s an excerpt:

    Critics of such large-scale combinations argue that when clinical assets are aggregated within contiguous geographic areas, there is market consolidation. And market consolidation leads to anticompetitive behaviors, resulting in higher prices without concomitant quality improvements, fewer small innovative providers left to disrupt the status quo, and depressed wages for health care workers.

    Delivery system leaders view asset aggregation in a different way — as a vehicle for efficient deployment of human, physical, and financial capital to achieve a health care mission. Upsizing by means of mergers and consolidation, hospitals and delivery systems realize benefits that come with economies of scale, spreading fixed operating costs…over a larger base of patient care revenue. Aggregating hospitals and physician practices within contiguous geographic areas enables systems to make large investments in facilities and technology that serve more people and avoid costly duplication….

    Large-scale aggregation of health care delivery enterprises helps level the playing field with large-scale payers…

    Often underappreciated is the importance for health systems of cultivating managerial bandwidth and subject-matter competencies unique to health care. As a health system grows, it gains the ability to compete on a national scale for top talent and expertise…

    Use of the term “corporatization” suggests that health care mega-providers are money-motivated, focused on goals that are all about the bottom line. But money motivation in health care is not unique to big corporations…

    In my experience, governing boards of delivery systems have four expectations of their executive leaders. Each expectation drives a financial motivation to generate the requisite revenues, operating margin, and investment capital.

    First, to take good care of people when they are sick or injured and to help people remain as healthy… the delivery sector must have the financial capacity to invest in workforce skill development and training, renewal and expansion of patient care infrastructure and technology, and business and enterprise management systems…

    Second, to operate in a financially responsible way, a delivery system needs to generate a positive operating margin, meaning revenues greater than expenses…

    Third, to position a health care enterprise for long-term sustainability, it requires the financial fortitude to withstand the vagaries of economic and political cycles that might jeopardize the future availability of services…

    And fourth, to stay true to a social or academic mission, many health care institutions make substantial financial commitments to their local communities and affiliated universities…

    Comparisons of life expectancy and health spending are unadjusted for important differences among countries, including household income and poverty levels, gun-related mortality, and public social services expenditures.2,3 Nobody benefits if we ascribe poor health outcomes to corporatization and ignore true determinants…

    Until we devise better solutions to improve the health of people whose economic disadvantages and behaviors reduce longevity, the United States will continue to lag.

    My take: This article explains how health care systems view consolidation. Overall, my view is that the costs associated with hospitals are too high and some of this could be curtailed without affecting outcomes (see: When Hospitals Look Like The Ritz (But Cost Even More)).

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    Mary Suhr: Coding Update 2025

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    Mary Suhr, a coding expert, provided our group with an excellent update on coding and the changes needed in documentation. I have taken some notes and shared some of her slides. There may be inadvertent omissions and mistakes in my notes.

    • In 2025, billing/coding relies entirely on medical decision-making OR time codes.  While documenting a comprehensive history and an exam are important for patient care and good practice, they are not important in billing/coding.
    • Medical decision-making (MDM) consists of three areas: diagnosis, review of data, and risks of treatment.  Data includes points for each lab reviewed/ordered and each radiology test.  If you order/review CBC/d, CRP, and CMP, this would be up to 3 points in this category.
    • With the changes in requirements in coding, the RVUs were increased for both outpatient and inpatient codes.  This reflects the increased difficulty in selecting some codes.  For example, the change in requirements, some 99214 codes several years ago will now qualify for 99213 codes.  It is much more difficult to use a 99215 code based on medical decision-making and the time spent is up to 40 minutes to use this code
    • Followup visits who are not doing well generally would NOT be a low level visit if documented appropriately
    Coding for F/u visits
    See slide below regarding split/shared services below.
    If APP spends the majority of the time, then the time codes can be billed by the APP
    or the MD can bill based on medical decision-making (but not time code).
    • Discontinuing a prescription medication can be counted as prescription drug management if documentation explains the potential benefits/risks of this
    • Newer codes that may be useful:
    • G2211 –>long-term longitudinal care code
    • 99451 –>interprofessional consultation (if patient consented). If an ED physician calls for consultation, documentation could allow for this code as long as the patient is not seen before or after within 7 days
    • 98016 –>audio (telephone) consult code for established patients. This could be used to check in to see if the patient needs an office visit
    • New ICD-10 codes for IBD with fistulas, BMI codes and eating disorders
    • If a patient is seen in ED and leaves ED, recommended to use ED codes, not office-based outpatient codes
    • For inpatients, HAL management is generally a high risk medication/treatment for coding-billing purposes
    • Document defensively.  Increasingly, insurance companies are trying to downcode visits.  Recommend resisting this and document why the initial codes were selected
    • Except for Medicaid, can use modifier 25 and bill if patient seen in clinic by one provider and in the hospital by another provider, if each was involved in patient care

    Why Corporatization Occurs in Health Care

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    A Chandra, M Shepard. NEJM 2025; 393: 833-835. The Corporatization Deal — Health Care, Investors, and the Profit Priority

    The authors of this article have a sanguine interpretation of the health care landscape. Here are some excerpts:

    The health care industry is exceptional in the United States: it relies on private businesses operating in markets to fulfill a fundamental human need. Because of health care’s essential nature, many observers have viewed the growing influence of large companies in the industry, known as “corporatization,” as odious, akin to privatization of fire and police departments. The corporatization of health care often evokes images of rapacious companies that prioritize profits over patients, since corporations operate according to the logic of business, emphasizing efficiency and financial returns, whereas medical institutions have traditionally operated as professional or charitable enterprises…

    Evaluating corporatization requires understanding why it occurs, when it can succeed, and why it can go wrong.

    Corporatization represents a deal between organizations and investors. New technologies, upgraded facilities, research and development, and competitive salaries are expensive but are necessary to meet the expectations of patients, who value improvements in health more than improvements in other goods. Investors supply the capital needed to support these enhancements and, in exchange, expect a financial return on their investment….Corporatization unlocks capital in return for growth that prioritizes profits, and investors may take an ownership stake in an organization or adjust management incentives to generate the necessary profits.

    But is this deal a good one?…agreements are voluntary and therefore presumably benefit the investors and medical organizations involved. But the key question for society and for policymakers is whether corporatization benefits groups that are not party to such deals: patients and payers…

    But for several reasons, health care is exceptional among U.S. markets in that profits and value often don’t align.

    First, patients may not be able to accurately assess the quality of medical care, so firms can make money by cutting corners, with little fear of affecting demand. Second, firms may engage in corporatization simply to build market power, which drives up prices. Third, many medical products and services are fundamentally unprofitable because people who could benefit from them cannot afford them…

    Corporatization’s effects on nursing home care appear to be largely negative. After being acquired by a private equity firm, nursing homes tend to avoid sicker residents, deliver lower-quality care, and have higher resident mortality2 …

    The biopharmaceutical industry is an example of a sector that probably couldn’t exist without investors, since enormous amounts of funding are needed to conduct expensive clinical trials with high failure rates…

    Corporatization isn’t the only tool medical firms can use to raise capital. One alternative is government funding, including subsidized loans or tax credits. But relying on public financing has downsides. Governments struggle to identify what patients want, owing to bureaucratic hurdles, a lack of incentives, and budgetary constraints. They are also subject to shifting political climates, making them unreliable funders for large or long-term investments that require steady outlays…

    What steps can be taken to unlock the benefits of corporatization while limiting its harms? The guiding objective should be better aligning profits (which drive corporate decision making) with value for patients…

    A second approach involves empowering regulators to enforce antitrust rules aimed at limiting market power that wasn’t sanctioned — or regulating prices when those efforts fail. But regulators already have these goals and struggle to achieve them because of tight budgets and bureaucratic limits…

    Corporatization will always involve trade-offs because there is no simple or universal “fix” to align profits with value for patients. In each area of medicine, regulators will need to decide whether the deal inherent to corporatization is a worthwhile one — and whether the alternatives are any better.

    My take: It is refreshing to see a different viewpoint regarding the profit-driven U.S. health care system. While this is not the system most observers would have created, it is what we have and the currently available alternatives could be worse.

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    “The Broken Promises of Profit-Driven Medicine”

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    N Tomes. NEJM 2025; 393: 521-524. A Gilded Age for Patients? The Broken Promises of Profit-Driven Medicine

    This article (one of several in a series) describes the development of the current corporate-centered health care system over the past 100 years and the drawbacks.

    An excerpt:

    Between the 1920s and the 1960s, the American medical profession adopted a new doctor-controlled business model of care delivery, dependent on continual investment in new drugs, technologies, and procedures. That model created the profit opportunities that enticed corporate stakeholders to invest in health care in the 1970s and 1980s. But as the corporate presence increased, physicians lost control of their business model; the “tail” of financialization began wagging the “dog” of medical practice. That shift coincided with corporate cooptation of the language of consumerism to justify these changes as in patients’ best interests. In the process, physicians and patients lost economic autonomy over health care choices…

    Insurance plans let doctors and hospitals set prices, facilitating more investment in the capital-intensive technologies equated with higher-quality care. But that dynamic also created an upward spiral of costs…These problems led to a second transformative movement: the federal government’s entry into the health insurance business, with the creation of Medicare and Medicaid, which also let doctors and hospitals set prices. This… aimed to relieve Americans of the duty of financing the medical system themselves, bringing in third parties to help. Enrollees in the new plans got more coverage but only on the terms set by those parties; uninsured people had to manage on their own. Meanwhile, the cycle of rising costs continued unabated…

    Medical entrepreneurs believed that applying market discipline to health care would produce the right combination of innovation, efficiency, and cost–benefit balance to ensure better care for patients while profiting investors…

    While adopting some consumer-industry practices, corporate health care players strove to avoid others, such as direct price competition. Policy efforts to rein in costs stressed the need for price transparency: consumer–patients needed to “shop” more critically for the cheapest care. In this spirit, political conservatives promoted “consumer-driven” health care. But such schemes foundered on the reality that many insurance plans gave patients little flexibility to price-shop for care…

    Many powerful health care industry stakeholders still believe allowing corporate interests freer rein will produce that “golden age for patients.” The health care economy’s fragility suggests otherwise…When they [hospitals] pivoted from profitable surgeries to unprofitable Covid care, they needed massive infusions of government funding to survive.  Similarly, recent shortages of essential but low-profit drugs, including chemotherapy agents and insulin, reveal the limits of the pharmaceutical industry’s profit-oriented approach to essential drug production…

    No market solution has arisen for the most critical determinant of poor health and health care outcomes in the United States: extreme income inequality. Countless studies indicate that poverty is the most important health risk factor that Americans face…little profit can be made by preventing or treating poverty-induced illnesses.

    U.S. health care needs a new business model…only more collective physician and patient action will help medicine find a more equitable, sustainable model…Many people will suffer if the system collapses completely, but perhaps a more sustainable health care system can be built from the rubble.

    My take: This analysis of the U.S. healthcare system, like many others, is analogous to getting the license plate of the truck that ran you over. At this time, there is little prospect of stopping the truck.

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