Why is US health care so expensive?

Craftylass

I'm an American who has been living in China for the past seven years.  Prior to moving to China, I never really thought much about the costs of health care.  We had good insurance and that was that.

We still have good international insurance, but have saved it for catastrauphic events.  In other words, we've paid out-of-pocket for preventive care to avoid making claims.  I've had my annual check-ups and mammograms over the past seven years, but never claimed them on insurance. 

In January, I was diagnosed with breast cancer.  I had seen a general surgeon in Hong Kong about a painful lump that had appeared in late October.  I also had skin redness.  He diagnosed non-lactational mastitis and prescribed antibiotics.  However, the mammogram showed a suspicious area and two days later, he performed an ultrasound guided core needle biopsy.  The pathology report gave the diagnosis of invasive ductal carcinoma.

I immediately switched to a breast specialist in Hong Kong.  I had another core needle biopsy (different area).  Had a PET scan.  Had an EKG.  Had extensive bloodwork.  Had chemosensitivity testing.  Had the FISH testing.  Several consultations with the specialist.  Started neoadjuvant chemotherapy on Feb 14, only two weeks post initial diagnosis.  Four cycles AC followed by four cycles Taxotere.  

I commute to Hong Kong every three weeks for my treatments (three hour flight to southern China and 1.5 hour bus ride into Hong Kong).  Because I live in a lesser developed area of China, I receive the Neulasta shot to help my white cell count.  Cycle 1 was uneventful with just minimal vomiting.  Cycle 2 was horrible with severe vomiting and severe nausea.  Cycle 3 was much better with the addition of Emend to control the nausea. 

I just filed the paperwork for insurance reimbursement for all the visits with the breast specialist, diagnostics, testing, pathology, bloodwork, two cycles of chemotherapy, support drugs and two Neulasta shots.  The total we've paid so far was $9400 US.  Yes, less than $10,000 US!!!!  I'm receiving top of the line care (with everything being reviewed by a medical oncologist friend in the US) for a fraction of the cost it would be in the US.  I'm going through the private system in HK since non-citizens are not eligible for the public (universal) care.  

I'm at a loss at the huge cost differential.  It's not as if Hong Kong is an undeveloped city.  In fact, it's one of the most advanced cities in the world.  Real estate is ridiculously expensive!  My doctor graduated from Hong Kong University and had training at the Sloan Kettering Cancer Institute, as well as at Yale and UCLA.  

The one "down-side" to this is that we pay everything up front and file for reimbursement.  We've spoke to the insurance company up front and they indicated that everything was standard procedure.  I've received acknowledgement from them that our claim is being processed.  (I will then file for the chemotherapy treatments that I've completed and then file for each one as it is completed.) 

Why are the costs so different?  I'm receiving the exact same drugs that I would in the US.  We will be relocating to the US the first week of July and I will have my last chemo and my surgery there.  I'm already dreading the costs that will be involved with that part of my treatment as our deductables will begin all over again for US coverage.

(By the way, when I refer to "we," I'm referring to my husband and to myself.  We did not claim the fees from the general surgeon and the tests he ran in order to keep things clean and simple.  His total was less than $2,000 US.)

cheryl1946

Beats me why US healthcare is so expensive. I just had a PET/cat scan; it costs $6,000,my co-pay was $50.  My local hospital charges for each gauze pad,etc.;unbelieveable what the 3 biopsies I had cost. The sad part is the US is far down the list of the best in health care.

The cat scan guided bone biopsy done at Dana Farber costs one flat rate. Don't know how much,since they told me even if insurance didn't cover it all,I would never get a bill from them.

peggy_j

Good questions and a big topic. Several years ago I heard a reporter from the Washington Post speak about health care in the US and the rest of the world. He wrote a book. He had a bad shoulder so part of the book is him going to docs around the world and seeing the advice they'd give for his shoulder. It was an interesting comparision.

Here's his book TR Reid (maybe at your library?)

http://www.amazon.com/The-Healing-America-Global-Cheaper/dp/1594202346 

In doing my google search for that title I came across this article, also in the WP (which is strange. I never read that paper)

Want to cut health care costs? Start here. 

http://www.washingtonpost.com/blogs/ezra-klein/post/want-to-cut-health-care-costs-start-here/2012/04/20/gIQA2P0NWT_blog.html 

One thing he said is that the US is the only country in the world where the people who decide what gets covered (in our case, the health insurance companies) are allowed to make a financial profit.  

My take, from my random reading, is that two things are big contributors:

1) the cost of Rx's (we pay much higher rates than other countries; the Bush health care reform specifically made it illegal for the government to be able to negotiate lower Rx rates. This is why people in Canada and elsewhere pay much less for the exact same meds)

2) the overhead of the health insurance business. There are so many companies and each company has many plans (etc). I can't imagine how much time is spent at those companies and in the doctor's office processing paperwork. It's a complete waste of time and $ IMO. In his book TR Reid said that one country (France? Japan? I forget) has a sheet on the back of the door listing the rates for each procedure.  Everyone pays the exact same rate.

cheryl1946

The reason meds are cheaper is that they are generic in other countries quickly. The US leaves them name brand for many years.

If you look at where some of the meds you take are made,it's Israel,India,etc.

I take generic hydrochlorothyazide,and it is made in India. 

ibcmets

Craftylass,

I don't know why the US is so expensive for healthcare compared to other countries.  I've seen so many doctors, every month for the last 3 years for stage IV bc and I can tell you the doctors are not getting the high profits.  You would think that medical employees would have great access to good health insurance, but they are rarely adequately covered.

I was very lucky to have worked for a very large world-wide company with good union benefits that guaranteed employees great health insurance.  I can not complain, but still have a difficult time making ends meet because of the deductibles yearly and with stage IV,  I will always need expensive treatments to survive.

The US has such a diversive mix of people from all over the world.  I wish those experienced with benefits in other countries could convince our government & the people here to make changes that are greatly needed here.

I'm glad you got onto Emmend for the nausea.  It worked great for me as well.

Great topic.

Terri

1Athena1

The very, very short answer to the question of your topic title is: inefficiency. There is a patchwork of delivery systems there are not coordinated and that do not reach millions. A second key reason: lack of price controls which enable abuse by the price setters. Big Insurance has long been exempt from anti-trust law regulations, and it still is. This means there is limited competition, hence limited market incentives to lower prices.

It's too early to tell whether the Affordable Care Act will improve this, as some of its key provisions have yet to go into effect and rules are still being drafted for other parts.

Chickadee

Saw something on ABC news the other day. There was a price comparison of simple appendectomies from many hospitals. The price range: anywhere from $1500 to nearly $100K. No complications, simple appendectomy. Most hospitals would not provide pricing at all. It's a mystery to me.

Craftylass

I'll have to look up those books.  I'm not sure I completely understand the proposed health care policy that Obama has put forth, but one thing I'm convinced of is that we do need some kind of reform!  There's no excuse for things costing so much!  (I had forgotten . . . when my son was born in 2001, he had fluid in his lungs and had to spend a week in NICU for observation, etc.  When we saw the bill, the charges were $10,000 per day for the NICU alone.  The insurance company "settled" at $5,100 per day.  If we had paid out of pocket, we would have had to pay the full amount.  To me, that's just wrong.  Another time, when we got the kids checkups in the States, I told the doctor's office that I was going to pay cash and that I would like a discount for doing so.  I then said, "I'd like to pay the same as the insurance companies."  The reply was, "We can't do that . . . if we did, then no one would need insurance companies!")

I live in China's northwest (a relativaly undeveloped area) and I go down the street to a local hospital to get my blood counts checked on day 7 (typical nadir) and day 10.  The hospital has an electronic board that scrolls the costs of everything!  It's like a menu!  I was quite impressed.  (China has universal health care, but it only applies to seeing doctors.  Everything else is out-of-pocket for the private patient and most patients will say that tests and treatments cost too much.)  I pay about $5 US for my blood check.

TAMallick

US is a most expensive country, so every way there cost is high. Also USA is a capitalist country, so everything is business their. But China is less expensive and socialist contry, so their government policy is helpful to people.

Craftylass

I agree that the US is an incredibly expensive country, but dollar for dollar (or yuan for yuan), healthcare is equally expensive for the average Chinese citizen.  The universal health case system there only covers doctors' fees.  Everything else is out of pocket for the patient.  Medical insurance is a new industry there. 

Additionally, medical care is sub par in most of the country.  I'm getting my chemotherapy in Hong Kong (quite a different story than the mainland) and I go back home to recover.  I developed a fever one night and the local hospital said I would have to wait until morning to get any cultures done.  They do not have a 24-hour lab!  

Most Chinese people will say that they do not trust the government to care for them . . . that they have to care for themselves. 

momof3boys

You say that you "pay out of pocket" and then get reimbursed. What does a BC patient do in Hong Kong if they don't have the money to pay upfront? Are they treated?

Who pays for the Drs education? Who owns the hospitals and practices? Are they govt owned?

Craftylass

Hong Kong has a two-tiered medical system.  The government (which is different than the government of mainland China) has a public health system which is very good.  You have to be a HK resident in order to qualify for this.  The main disadvantages to this system is the waiting for appointments, etc. A HK resident cannot be refused care at a government facility.

Then, there is the private health care system.  Many HK residents will purchase insurance that will cover private care outside of the public system.  This allows them to not have to wait for appointments.  All insurance policies in HK (and much of Asia) are "pay-up-front" with patients being reimbursed by the insurance companies.  The medical facilities do not process insurance paperwork at all.  It's all up to the patient to do so.  (On a personal note, the paperwork I filed for reimbursement was relatively simple.  It took six weeks for the company to process it and I've been reimbursed in full.)

There are government owned hospitals and privately owned hospitals/clinics/practices. 

The doctor/nurse pays for his/her own education unless there are scholarships.

Note:  There is a HUGE difference between Hong Kong and mainland China.  The two are classified as "One country, two systems."  Hong Kong has top notch health care while the mainland is quite questionable.  There is a big struggle right now with mainland Chinese crossing the border to have babies in HK.  A woman literally has to reserve a hospital room for delivery about the same time she discovers she is pregnant!  If it's an "auspicious" year, then it's even harder.  Many mainland Chinese want their child born in HK for all the benefits, but another reason is for the quality of care given during childbirth.

omg333

Also, many people are living longer in the US. For example, my father took a lump sum pension from the mill, had terrific health coverage and 14 years later, had a stroke that left him paralyzed....I had to get an estate attorney asap, his policy allowed 100 days in a snf.....we had to do a pay-down, because once the 100 days were up....they start taking his life savings! While applying for transistional SSD....He lost about $25,000 of his and my mum's savings, then thankfully SSD kicked in and basically paid for everything. Who know's what is what when determining the cost of his care?  During his 2 years (aweful) stay, he was hospitalized many times, Never saw an itemized bill for each visit, yet I'm sure there were many things "added", as the one woman said, they charge for each gauze, aspirin, probably a flat rate charge for plain ol water....It all makes me sick, of which I cannot afford at all!

PS: And the many people that are living longer are in these facilities, some are being kept alive by machines for years, my dad's roomate was one of them! I said to myself, isn't anyone who is terminal....allowed to die naturally these days?? 

Chickadee

Can't die naturally because someone sees an opportunity to sue the Dr or hospital for not "saving" our life.

omg333

that is plain scary, and what about ethics???

Craftylass

That's why it's important to write your own health care plan.  Both my husband and I have each other listed as health care power-of-attorney and we both have in writing for a non-machine-supported life plan (should something happen to both of us at once).  We also have a do-not-resusitate plan.

crazy4carrots

Just saw this thread and have to correct one of the above statements about the cost of drugs in Canada:  First, the cost of drugs is lower because, with universal healthcare, the governments in each province negotiate with the pharma companies for lower prices.  Secondly, generics usually come on the market a few months BEHIND the U.S., not earlier.

 

And about those insurance companies and administrative costs:  It's estimated that approximately 30% of the cost of the healthcare you receive in the U.S. goes towards administration.  What a waste! 

omg333

i saw a pic of an elderly woman that had tatooed on her chest...do not resusitate! Many family members do not know in a huff, where to find the paperwork....i was taught, you put your paperwork in a plastic bag in the freezer, because paramedics are taught to look their first, in case they cannot reach a family member.

fitzdc

Emergency personnel will look in the freezer or fridge if a sticker is place on the door or the residence instructing them to do so.  They will not/do not look in the freezer automatically.  And keep a list of all meds by the phone, too.  On the list you can indicate where other important information is stored.

Blessings2011

I was fortunate to work for a large university, represented by a strong union. Our benefits were negotiated every two years.

For most of my 20 years there, my employer paid the premium on my health insurance. Only recently did it start coming out of my paycheck, and later, my retirement check.

I pay just $40 per month for both myself AND my husband's Kaiser coverage.

There are no deductibles.

A visit to the PCP (who we love) is $15, as is a visit to any specialist we need (and referrals are easy to get.) All labwork, all X-rays, all mammograms, all MRIs, all biopsies, in fact all diagnostic procedures are at no additional cost.

My hospitalization and surgery (mastectomy with reconstruction) last December cost me nothing out of pocket. The $50 inpatient fee was waived because I was a breast cancer patient.

Drugs are either $5, $10, or $15, depending on the formulary.

My heart just breaks when I read how expensive medical care is for other people. I know we are extremely fortunate to have this coverage.

exbrnxgrl

Blessings,

I am also a Kaiser patient in CA. The plan is through my employer, a k-8 school,district. It sounds as if our plans are similar. I have no co-pay for my labs, infusions, imaging etc. I realize how very fortunate I am. Both dd's have Kaiser through their employers with slightly different plans than mine. It makes me very angry that my family just got lucky, based on what our employers offered, while others are being bankrupted by their illness.

Caryn