Last week I read the New York Times article “The $2.7 Trillion Medical Bill” by Elisabeth Rosenthal. The article started with the following chart:

Suffice it to say that anyone reading the above chart should be appalled. The chart above shows that Americans are paying much more for the same procedures, at times by several orders of magnitude higher. Sadly, within the U.S., pricing from one hospital to the next can have even larger variations.

A colonoscopy is a case in point; It is a perfect illustration of what is wrong with the American form of administering healthcare. First, let me relay a short personal story:

As a small business owner I purchased health insurance for the family after my wife stopped working. She stopped while pregnant with my now 22-year-old daughter. I have had continuous health insurance for the family for those 22 years through an engineers’ group plan. After the cost reached near $20,000 per year a few years back, I bailed into a catastrophic health plan for my daughter and me, and a high risk plan for my wife (she has Lupus and could not be insured otherwise). When my daughter started college, I added the college’s health insurance policy for my daughter. So, yes, I have three policies.

In those 22 years I have never had a colonoscopy for screening. I knew it was time but since no one in my family, that I knew of, had colon cancer, I figured it was a calculated risk. Because under the old health insurance paradigm, I knew if I had polyps, health insurance going forward could be rescinded or denied in the future. With the advent of Obamacare (Affordable Care Act), those fears were no longer there.

First, the cost of the colonoscopy was covered by my insurance policy, and no matter what was found, I would still maintain my policy, and going forward I could still shop for any other policy like anyone else. Suffice it to say, two polyps were removed and it were the type that, over the years, could have turned cancerous. I think it is safe to say Obamacare saved me at least money and maybe my life.

Decisions like mine are made by millions of Americans every year because of a failed healthcare system. The major culprit is treating the entire healthcare system like a market where goods and services are traded and priced based on supply and demand. That has been one of the most immoral practices of our country. If one doubts this, the following excerpt from the above mentioned article is probative:

Colonoscopies offer a compelling case study. They are the most expensive screening test that healthy Americans routinely undergo — and often cost more than childbirth or an appendectomy in most other developed countries. Their numbers have increased many fold over the last 15 years, with data from the Centers for Disease Control and Prevention suggesting that more than 10 million people get them each year, adding up to more than $10 billion in annual costs. Largely an office procedure when widespread screening was first recommended, colonoscopies have moved into surgery centers — which were created as a step down from costly hospital care but are now often a lucrative step up from doctors’ examining rooms — where they are billed like a quasi-operation. They are often prescribed and performed more frequently than medical just guidelines recommend. The high price paid for colonoscopies mostly results not from top-notch patient care, according to interviews with health care experts and economists, but from business plans seeking to maximize revenue; haggling between hospitals and insurers that have no relation to the actual costs of performing the procedure; and lobbying, marketing and turf battles among specialists that increase patient fees. [Source].

The same colonoscopy procedures can range from just over $1,000.00 to over $9,000.00 dollars. If you are self-employed with no insurance you pay the higher rate. If you have the muscle of an insurance group you may pay much less. If you have the muscle of ‘we the people,’ your government, you would pay a price where, theoretically, gouging would not be allowed.

Markets are good in some areas and immoral in others. The identity of a nation should be defined by the education, upward mobility, and health of its citizens. The acceleration towards privatization is increasingly putting the vast majority of the nation on the losing side of all three. It is reflected in citizens’ aggregate education slippage relative to the rest of the world, diminished upward mobility, and aggregate poor healthcare outcomes.

Obamacare is a fair compromise in a misinformed country where socialized medicine is still a feared and bad word. A single payer system with cost controls is best. Notwithstanding all countries with better health outcome that follow that sensible model, Americans will eventually be forced to grow up and disregard the misinformation from the American plutocracy that profits from their ignorance.