Healthcare: Where the Money Goes

For indispensable reporting on the coronavirus crisis, the election, and more, subscribe to the Mother Jones Daily newsletter.

Why does healthcare cost so much in the U.S.? Well, we typically rely less on hospital care and more on outpatient care than most countries, so you might expect that we pay less for hospital care and more for outpatient care. But you’d only be half right. Even though we use less hospital care we still pay more for it than most countries. And since we use more outpatient care we pay a lot more for it:

The fact that we’re spending so much on outpatient care isn’t necessarily a bad thing. Same day surgery does cost less in general that longer inpatient stays. But it’s undeniable that the incentives in the system to financially reward quicker and less invasive procedures have increased their use. The financial rewards are much more for outpatient than inpatient care, and the fee-for-service mechanisms of the US encourage the use of more care.

….So here’s our first bit of depressing news. The single biggest contributor to the money we’re spending that’s “extra” is for medical care. It’s not a company or a crook. It’s for actual stuff that we seem to value. I will get into some of the specifics of this in future posts, but the bottom line is that when we talk about cutting spending, we will need to talk about reducing this amount. Especially since, if we were spending so much on care, we should expect to see impressive returns in quality (which we don’t).

The introduction to Aaron’s series on the cost of medical care is here, including links to each post in the series. It’ll be finished up on October 1.

DEMOCRACY DOES NOT EXIST...

without free and fair elections, a vigorous free press, and engaged citizens to reclaim power from those who abuse it.

In this election year unlike any other—against a backdrop of a pandemic, an economic crisis, racial reckoning, and so much daily bluster—Mother Jones' journalism is driven by one simple question: Will America move closer to, or further from, justice and equity in the years to come?

If you're able to, please join us in this mission with a donation today. Our reporting right now is focused on voting rights and election security, corruption, disinformation, racial and gender equity, and the climate crisis. We can’t do it without the support of readers like you, and we need to give it everything we've got between now and November. Thank you.

DEMOCRACY DOES NOT EXIST...

without free and fair elections, a vigorous free press, and engaged citizens to reclaim power from those who abuse it.

In this election year unlike any other—against a backdrop of a pandemic, an economic crisis, racial reckoning, and so much daily bluster—Mother Jones' journalism is driven by one simple question: Will America move closer to, or further from, justice and equity in the years to come?

If you're able to, please join us in this mission with a donation today. Our reporting right now is focused on voting rights and election security, corruption, disinformation, racial and gender equity, and the climate crisis. We can’t do it without the support of readers like you, and we need to give it everything we've got between now and November. Thank you.

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate