Introduction

The healthcare system in the United States is often criticized for its high costs and subpar outcomes compared to other developed nations. One might wonder why, if the system is so unreasonable, Americans do not simply opt-out of the high premiums and medical expenses by seeking an NHS-style service or other universal healthcare options. This article explores the reasons behind this situation and the impact on individuals and society.

Bankruptcy and Raising Prices

Perhaps the most striking reason why Americans have not abandoned the system is the financial impact of medical bills. Approximately half a million people file for bankruptcy each year due to the inability to pay medical expenses. The consequences of bankruptcy, such as increased medical costs due to reduced competition among healthcare providers, raise the question of whether a change in the system is truly desirable.

The Role of Health Insurance and Tax Incentives

Americans' reliance on health insurance plays a significant role. Some of the premiums paid towards health insurance are eligible for tax deductions, as are out-of-pocket medical expenses. This incentivizes individuals to purchase more comprehensive insurance plans, even if those plans ultimately do not cover the costs. Moreover, for lower-income individuals, health insurance is subsidized, making it more affordable.

Medical Expenses as a Necessity

Contrary to the perception that medical expenses are optional, the current tax code in the US does not recognize them as a necessity for deduction purposes. One can only deduct medical expenses that exceed 7.5% of their annual income, which is a much higher threshold than food expenses that are not tax-deductible. This disparity highlights the challenges individuals face in managing their healthcare costs without adequate financial support.

The Resistance to Universal Healthcare

Absent from the US healthcare landscape is any form of public, universal health care system similar to Brazil's SUS or the UK's NHS. Resistance to such systems stems from cultural values of individualism and self-reliance. Americans do not like the idea of relying on the government for essential services, believing that helping each other should be a personal and voluntary act rather than a collective obligation.

An Analysis of Healthcare Costs

Despite the reported high costs, it is essential to look at the actual healthcare expenditures in the US. On average, employees contribute only 2.9% of their earned income for medical care, leaving 7.1% for potential healthcare spending. A single individual earning a living income of $54,360 in 2023 can deduct a total of $5,436 for insurance premiums and out-of-pocket medical expenses in a year. This means that the majority of working Americans can manage their healthcare costs without significant financial strain if they allocate the appropriate portion of their income to healthcare.

The Impact of Preventive Care

Preventive medical care, which accounts for 3% of a living wage in 2023, is affordable even for those on a modest salary. If the household leader remains rational and dedicates 10% of their income to healthcare throughout their working life, they can manage the costs effectively. This approach ensures that preventive care is accessible and affordable, reducing the burden of more costly treatments and hospitalizations.

The British Experience with NHS

The NHS was established after World War II, when the British government made a conscious decision to provide universal healthcare to its citizens. NHS consultants initially opposed the system, but eventually recognized its benefits. The government aimed to ensure that all citizens, regardless of their socioeconomic status, had access to quality healthcare from birth to old age. The success of the NHS highlights the potential of a publicly funded healthcare system in improving health outcomes and equity.

The American Paradox

Americans seem to value the exorbitant premiums they pay for medical insurance as a symbol of their status and even as a form of medical insurance. However, the reality is that these high premiums do not guarantee adequate coverage, and insurance companies may refuse to pay for costly or frequent treatments. Americans may need to reassess the true value of the premiums they pay and consider whether a more rational approach to healthcare could improve their overall well-being.

Conclusion

The US healthcare system remains problematic due to its high costs and inferior outcomes. The cultural and economic factors that make it resistant to change are explored here. By understanding these factors and the impact on individuals, policymakers and citizens can work towards a more equitable and effective healthcare system.