Expensive things cost more
American health care is so incredibly expensive that it's hard to understand just how much more we spend compared to other rich nations. The United States dedicates about as much tax revenue to Medicare, Medicaid, and the VA as peer countries spend to cover their entire populations, and then on top of that, we spend that same amount again privately — $3.3 trillion.
Why? As Aaron Carroll notes, a new paper in the Journal of the American Medical Association suggests the answer mostly comes down to prices. An aging population and other factors account for some of the increased spending between 1996 and 2013, but about 63 percent of it can be explained by more procedures being done to patients, and the price of those services going up. Other research suggests it's probably mostly the prices.
Other countries have dealt with the price problem with controls, but as yet the U.S. doesn't have such a policy. Watch Carroll explain this mess below. Ryan Cooper