Reasons Why Healthcare Is Expensive

Countries like the US are facing rising costs for healthcare services. People spend a good part of their earnings on medical services. People with long-term and chronic diseases face this problem more. The cost of technologies, procedures, and new medicines are rising. Therefore, many people are spending on healthcare insurance.

The rising healthcare expenses are dependent on many factors.

  • Waste From Multiple Systems

Administrative costs are a major reason behind the rise in medical expenses. The US spends a better amount on administrative costs than other countries. The country follows a complex healthcare system and they have different rules for enrollment dates, funding, and extra costs for insurance for employers. In every sector, employees have to choose from different coverage tiers, deductible plans, customized care plans, and service systems.

  • The Rise In Drug Costs

The US is one of the European countries that spends more on drug prices. In other countries, the government imposes certain regulations on drug prices and it is based on the benefits of the medication. However, the private insurers in the country can negotiate the prices with the drug manufacturers.

  • High Charges For Doctors And Nurses

Doctors and nurses in the country charge more than any other industry. Specialist doctors are paid more than other doctors. This expense is forcing people to spend more on medical services. Cutting the costs of expenses for healthcare professionals can reduce healthcare costs.

  • Hospitals Become Profit Centers

Between 2007-2014, the cost of outpatient and inpatient hospital care increased than physician costs at a rapid rate. The price of surgical procedures in US hospitals is more than any other country. Thus, many hospitals are financially suffering today mainly because of the lockdown and the stoppage of elective surgery.

  • Defensive Medicine Practice

Hospitals and physicians are interested in avoiding lawsuits, and they can order scans or tests. These tests can be expensive. These scans and tests make medical care costly for US residents.

  • Variation In Price

As mentioned above, the system is extremely complex and therefore, there are no predefined prices for any medical services. Therefore, providers can charge according to their choice. The price will vary according to the payer as well as geographical area.


In most countries, governments play a crucial role in negotiating the costs of healthcare services. Unlike other countries, the rise in administrative costs will not affect medical expenses. The government will try to control the cost of hospital costs, medical equipment, and low drug costs. It will influence the choice of treatments and the ability of the patients to consult specialists or get costly treatments. Even though consumers get few choices, costs will be extremely controlled.

When taking the case of the US, the lack of strong political support controls the government from finding a big role in managing healthcare costs. Even though there are rules to ensure healthcare access, the country promotes competition among healthcare providers and insurers. However, individuals have to do thorough research to find the best medical services that would be ideal for them.

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