By Savannah Ramirez
About 29 percent of the total tax revenue gets put into America’s healthcare system, which is the largest portion of tax funding for a department. Even with this, about 41 percent (or 79 million people) of Americans still experience medical debt and inability to pay back large medical loans, according to Commonwealth. This raises the question: if so much revenue goes into the healthcare system (which includes insurance companies), why do so many people struggle with medical bills?
Americans around the country have struggled with the cost of insurance policies, medical bills, and the cost of medications. Leaving millions of families wondering why their insurance doesn’t cover the expenses. One could argue that insurance and drug companies pay more attention to increasing their profits, rather than focusing on the medical needs of the people.
Around 92 percent of Americans have health insurance, with policies that cover most, if not all, of their medical expenses. But the worry of hospital bills strikes in every American, especially the ones who are insured. This can be explained by the fact that insurers deny every one in five claims even if they meet the coverage rules. This ratio is concerningly low as it shows someone can be within the companies standards and still get denied the money they need. It may seem like this process can save insurers from handing out money to everyone who asks, this would have quite a negative impact on the companies and their funds, which would in turn affect taxpayers. However, this system is flawed as it can deny someone who has dire or even fatal circumstances. It’s not an easy task to speak with every single person who files a claim, and unrealistic to expect insurers to do that as they have millions of clients under their company. At the end of the day, rejecting claims just to meet a possible quota or to save some money for the company can endanger lives, particularly for those with fatal conditions..
However, Americans without insurance have even fewer options. Many report skipping doses of medications to make them last longer and even choose not to fill their prescriptions right away due to high costs. Under the Inflation Reduction Act, the price of insulin was able to be capped at $35 by allowing Medicare Part D to negotiate the prices of certain drugs, according to Public Citizen. The Act also allowed federal agencies to work with other drug manufacturers rather than just the ones that price medications excessively. Even with this act in place, which has helped millions, Americans are still feeling the negative effects of drug shortages and high costs, according to the American Hospital Association. This impacts hospitals directly as they are the main providers of these drugs, forcing hospitals to raise their costs in order to keep up with the rising prices of medications. Research has shown that the cost to research and make a drug has no impact on its future pricing; that’s determined by the companies’ belief on how the drug performs within the economies’ market.
American citizen Jahn Ramirez opened up about his experience with insurance and drug costs.
“I pay 75 percent of my health insurance, my employer pays the other 25 percent. It’s hard for me to cover my entire family, it’s very difficult. Most of my medications are free, if not they are $25 at the most,” he said.
Fortunately, Mr. Ramirez has good experiences with the costs of medications but still struggles with the cost of health insurance. Having a policy with multiple people on it drives the price really high, he explains.
Another habit of drug manufacturers is to spend millions of dollars in stock buybacks and buying dividends. Reportedly, the same drug manufacturers that were allowed to negotiate drug prices due to the Inflation Reduction Act spent $10 billion more in stocks and executive compensation rather than drug research and development in 2022. This behavior illustrates a pattern that insurance companies prioritize habits that could increase their profits over the healthcare needs of their clients.
The combination of insurance companies and high costs of medications are creating a perfect storm for hospital bills and medical debt to add up for Americans. Those with fatal diseases and urgent needs are being denied the coverage they need due to flawed tendencies that insurance companies have adopted. Being in any kind of debt puts a big strain on a person as well as their family, and puts an even bigger strain on them if they don’t have the liberty to get the medical help they need.
Communications major Ava Rivera talks about a personal experience with the struggle of medical expenses.
“My cousin has a heart condition so for years she’s had to get multiple surgeries and go to multiple doctors, so it was very expensive for them and the insurance didn’t cover all of it,” she shared.
Although the biggest portion of tax revenue gets funneled into the healthcare system, many Americans still struggle with medical expenses as the fight over profits vs. patients continues. Even with the Inflation Reduction Act, which helped in many ways, insurance companies and drug manufacturers are finding ways to delay changing their tactics; changes a lot of Americans are waiting on.
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