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Personal Finance Tip: Don't Get Sick, Injured, or Hurt in America

Why are common medical procedures so expensive in the United States?


"The United States spends more money on health care than any other country in the world." That is not up for debate. "The United States provides the best health care in the world." That is very much up for debate. So, if the U.S. clearly spends the most money on health care, but does not clearly provide the world's best health care ... what the hell, U.S.A?

This is why we have The New York Times. Today, Elisabeth Rosenthal published the first of a multi-part investigation into this country's crazy-high health care spending. There are charts and maps and infographics—along with some great reporting. Rosenthal writes:

Americans pay, on average, about four times as much for a hip replacement as patients in Switzerland or France and more than three times as much for a Caesarean section as those in New Zealand or Britain. The average price for Nasonex, a common nasal spray for allergies, is $108 in the United States compared with $21 in Spain. The costs of hospital stays here are about triple those in other developed countries, even though they last no longer, according to a recent report by the Commonwealth Fund, a foundation that studies health policy.

The takeaway, then—and what The Times plans to look at over the coming months—is not necessarily that the U.S. health care system offers expensive drugs or extensive end-of-term care (it does both) but that the bigger issue is that it charges a ton of money for what are relatively common medical procedures. And why is that?

Consumers, the patients, do not see prices until after a service is provided, if they see them at all. And there is little quality data on hospitals and doctors to help determine good value, aside from surveys conducted by popular websites and magazines. Patients with insurance pay a tiny fraction of the bill, providing scant disincentive for spending.

The rest of Rosenthal's piece focuses on the rising costs of colonoscopies and is worth a read—if for no reason other than the correction at the bottom. Miss you, Michael.