Paying Through The Nose

Why is US healthcare so expensive compared to the rest of the world? Mostly it's because we pay a lot more for the same services. Ezra Klein has a lot of helpful charts. How about a routine office visit? In Spain that only costs $15, $31 in France, or $32 in the Netherlands. In the US, the tab would range from $59 to $151.


How about some lipitor for your high cholesterol?

These kind of price differentials exist across the board. So why are insurance companies so bad at controlling costs compared to European governments? The answer is probably complicated, but one reason might just be the amount of friction they introduce into the system. Doctors in the US need big staffs, mainly to handle the interface with various payers and insurance companies. Whatever the reasons, its clear that we are doing some things very wrongly.

It seems unlikely that the health care bills being considered will change that much, but universality needs to come first. Once that is accomplished, we will be much better positioned to control costs.

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