February 20, 2019
September 11, 2018 by Dr. Varner in Healthcare without Insurance
According to the latest figures, $9,086 is spent annually on healthcare in the US per person.
For anyone living in the United States, that might not be too surprising. We all know that healthcare doesn’t come cheap. That’s the price we pay for having the best system in the world, right?
Not quite. Not only is life expectancy in the US not #1, it’s actually way down at #37. Just below Lebanon and Qatar.
Meanwhile, in the United Kingdom, an average of $4,000 is spent per person and they rank #20 on the list. And in Mexico, the life expectancy is just two years shorter than the US, but they spend only $600-$800 per year.
No matter which way you go on the scale, you’ll see that we’re spending way more than everyone else and getting far less for it.
Just take a look at the average cost for heart bypass surgery. In the UK, the surgery would cost you about $43,000, whereas in the US, it can range anywhere from $70,000 to $130,000. And the prices go up each year.
But, wait. Not everything is getting more expensive in the US healthcare market.
There are some areas of healthcare where the prices are actually going down, not up. Two clear examples are in cosmetic surgery and laser eye surgery.
Since 1992, the prices of cosmetic surgery services have increased about 32 percent. However, given that inflation has gone up about 64 percent during that time, cosmetic surgery has actually gotten cheaper.
The decline is even more apparent with laser eye surgery. The procedure cost about $2,200 an eye when it was first introduced back in 1999, but today you can go on Groupon and get it for $890 an eye. Not only is it cheaper, it’s better quality too! I just had laser eye surgery myself about a year ago and it changed my life.
So, why are cosmetic and laser eye surgeries getting cheaper, while critical procedures like heart surgery are getting more expensive?
The difference is cash.
Cosmetic surgery isn’t covered by insurance. So when people walk into a cosmetic surgeon’s office they know they’ll be paying in cash, thus they ask the very crucial questions: How much is this? Is it worth it?
If they decide it’s not worth it, they don’t get it done. Or they go look for someone else to do it. If the cosmetic surgeon wants more clients they have to either improve their service or lower their prices. They have to operate like any other business.
On the contrary, when people go for heart surgery or any other related procedure, they assume it’ll be covered by their health insurance, so they don’t even ask.
89 cents of every dollar spent on healthcare doesn’t come directly from the patient’s pocket, it comes from a third-party payer, such as Medicare, Medicaid, Blue Cross Blue Shield, etc.
Since they’re not paying the full price of their treatments, patients don’t have a real incentive to ask the important questions. They no longer participate financially in their healthcare decisions.
If their doctor recommends they get an MRI, they don’t ask “Hey doc, do I really need this?” Instead they say, “Why not? It won’t cost me anything.” Doctors think the same to themselves, “An MRI won’t cost me anything, so why not go for it just in case?”
The result is a huge number of wasteful, unnecessary tests at inflated prices. All of which are being billed to Americans, not directly at the time of treatment, but through raised insurance premiums and tax bills.
The key to changing the situation of exorbitantly high healthcare costs in the US is for people to start making their own financial decisions regarding their health care.
When people are involved in comparing the costs and benefits of undergoing certain treatments and procedures, they will decide when it is worth it to proceed and with whom.
Not only will this vastly reduce the number of unnecessary tests that are conducted, but will also push doctors and hospitals to provide cheaper and better service.
One great step we’re seeing in this direction is in the direct primary care movement, as people are starting to reject insurance companies and to establish cash-based agreements with doctors.
Another great solution is to look for alternative solutions outside of the US. As people have begun traveling all over the world looking for medical procedures at a lower price, they are discovering that not only are the solutions abroad much cheaper, but often times they come with much better service.