#healthcare + #politics

Cutting costs by cutting benefits is difficult, but the program can also achieve substantial economies of scale in the prices it pays for health care and administrative expenses—and, as a result, private insurers' costs have grown almost 60% more than Medicare's since 1970.[citation needed][106][original research?][107] Medicare's cost growth is now the same as GDP growth and expected to stay well below private insurance's for the next decade.

Health care spending in the United States, as a proportion of gross domestic product, is significantly higher than in other high-income countries, yet health outcomes are far worse. For example, average life expectancy is lower than in peer countries, while avoidable death rates are higher.

Systemic inequities lead to pronounced disparities in care and outcomes for many racial and ethnic minority groups, low-income families, and rural populations.

Health system challenges include rapidly rising costs caused in part by market consolidation, inconsistent access to primary and specialty care, and administrative complexity.

Healthcare in the United States is largely provided by private sector healthcare facilities, and paid for by a combination of public programs, county indigent health care programs, private insurance, and out-of-pocket payments.

The U.S. is the only developed country without a system of universal healthcare, with around 92% of the population covered under some kind of health insurance for some, or all of the year.

The United States spends more on healthcare than any other country, both in absolute terms and as a percentage of GDP;

In 2022, the United States spent approximately 17.8% of its Gross Domestic Product (GDP) on healthcare, significantly higher than the average of 11.5% among other high-income countries.[

For 2026, across 312 insurers participating in the ACA Marketplaces from the 50 states and the District of Columbia, this analysis shows a median proposed premium increase of 18%, which is about 11 percentage points higher than last year. This is the largest rate change insurers have requested since 2018, the last time that policy uncertainty contributed to sharp premium increases.

key factor driving costs in 2026. Insurers cite increasing cost and utilization of high-priced drugs as well as general market factors, such as increasing labor costs and inflation, as contributing to premium increases.

In addition to rising healthcare costs, the majority of insurers are also taking into account the potential expiration of enhanced premium tax credits in their premium rate increases for the next year. The expiration of enhanced tax credits will lead to out-of-pocket premiums for ACA marketplace enrollees increasing by an average of more than 75%, with insurers expecting healthier enrollees to drop coverage. That, in turn, increases underlying premiums. Other federal policy changes, like the implementation of tariffs and the ACA Marketplace Integrity and Affordability rule were also discussed, though to a lesser extent.

Enrollment in the Affordable Care Act continues to erode as some customers struggle to make premium payments, with the declining numbers churning market uncertainty for insurers. In response, insurers are likely to raise rates again next year, following this year’s larger-than-typical hikes.

A KFF analysis released May 19, for instance, found that the average ACA plan deductible saw the steepest increase in history — growing by 37%, or over $1,000, from $2,759 in 2025 to $3,786 in 2026 as enhanced premium tax credits expired.

Those rising costs pose a political challenge for President Donald Trump and the broader GOP, which has opposed enhanced subsidies to help people purchase Obamacare coverage. Republican lawmakers also passed a spending package last year — enacted as the One Big Beautiful Bill Act — that included provisions expected to reduce ACA enrollment and was cited among factors fueling higher premiums this year.

U.S. vaccination rates have dropped and the share of children with exemptions has reached an all-time high, according to federal data. At the same time, rates of diseases that can be protected against with vaccines, such as measles and whooping cough, are rising across the country.

During his Senate confirmation testimony last year, Kennedy told lawmakers that a closely scrutinized 2019 trip he took to Samoa, which came before a devastating measles outbreak, had “nothing to do with vaccines.”

But documents obtained by The Guardian and The Associated Press undermine that testimony.

Public health experts also criticized the president for making unfounded claims about highly politicized health issues. During a September Oval Office event, Trump asserted without evidence that Tylenol and vaccines are linked to a rise in the incidence of autism in the United States.

Most of the deals, however, don’t affect what people with private insurance or Medicare pay for the drugs. People with Medicaid — who typically have minimal or no copays for prescriptions — already pay very little.

“Generally speaking, most people with insurance coverage will continue to be better off using their insurance to obtain medications rather than purchasing through the TrumpRx direct-to-consumer portal,” said Juliette Cubanski, deputy director of the program on Medicare Policy at KFF, a nonpartisan health policy research group.

The website asks customers to confirm that they are not enrolled in “any government, state, or federally funded medical or prescription benefit programs.” Those with both commercial and government-funded plans are considered to be on government insurance and are not permitted to participate in TrumpRx.

The US has one of the most expensive health systems in the world, with spending on health care estimated to reach $5.9tn (£4.3tn) in 2026, according to the Centers for Medicare and Medicaid Services. But despite spending twice as much per capita on healthcare compared with wealthy nations of a similar size, the US has a lower life expectancy than those other nations, according to health research nonprofit KFF.

Large publicly-traded health companies have tripled their profits over the last two decades, paying out shareholders over $2.6tn from 2001 to 2022, according to a study in the Journal of the American Medical Association. "We are the only major [health] system in the world that allows the free market to run loose," said John McDonough, Harvard TH Chan School of Public Health professor.

Roughly one in five Americans covered by private health insurance reported their provider refused to pay for care recommended by a doctor in 2023, according to a survey by KFF.

The number of overlapping health care systems in the US - Medicare, Medicaid, the marketplace, employer-sponsored insurance and veteran's health, among others - creates a confusing and sometimes wasteful system, said McDonough. "We have so many, each of them with their own set of rules, their own system, their own bureaucracy," he said. "We really do need some system consolidation."

Healthcare spending is driven by utilization (the number of services used) and price (the amount charged per service). An increase in either of those factors can result in higher healthcare costs. Despite spending nearly twice as much on healthcare per capita, utilization rates for many services in the United States is lower than other wealthy OECD countries. Prices, therefore, appear to be the main driver of the cost difference between the United States and other wealthy countries.

The U.S. spends twice as much as comparable countries do on health, driven mostly by higher payments to hospitals and physicians.

"Private insurance companies in this country spend between 12 and 18 percent on administration costs," Sanders said on NBC’s Meet the Press on Sept. 17. "The cost of administering the Medicare program, a very popular program that works well for our seniors, is 2 percent. We can save approximately $500 billion a year just in administration costs."

Is the gap between private and public health insurance providers’ administrative costs really that high? Most experts agreed the numbers looked about right. But because of key differences between Medicare and private insurance, the trade-off isn’t as simple as Sanders suggests.

If "the numbers looked about right", then why is it "half truth"?

Experts told us we could safely assume private insurance costs, on the other hand, are much higher, though actual spending estimates vary.

Aah... So it's a "half truth" because Bernie understated how much cheaper medicare is than private insurance companies.

Historically, administrative expenses were much higher in the commercial market because insurers did a lot of underwriting, or using the health status of individuals or groups to determine their premiums. The Affordable Care Act was designed to curb that spending.

On top of that, experts explained that unlike Medicare, private insurers take on more responsibility than simply paying claims or occasionally going after fraud. Before a claim is even filed, they check its appropriateness, assess whether it is medically necessary, and whether it can be done in a cheaper way (outpatient versus inpatient care, for example).

"Medicare has been trying in fits and starts to look a little more closely at how it pays claims but generally speaking, it is passive in processing claims," Sabrina Corlette, a research professor at the Center on Health Insurance Reforms at Georgetown University.

And private companies, deny more claims, which makes it more expensive.

Health expenditures per person in the U.S. were $13,432 in 2023, which was over $3,700 more than any other high-income nation.