Why Can’t the US Shake Off Its Giant, Bloodsucking Health Insurance Burden?

In a recent photo from a G7 summit, only one individual represents a nation where a medical crisis can financially devastate a family, thrusting them into bankruptcy and homelessness, with the impact reverberating across generations.

It’s a lesser-known fact among Americans that the United States stands alone as the only developed nation that does not regard healthcare as a universal right for all its citizens. We are the last one remaining.

The US allocates more towards healthcare expenses than any other country globally, approximately 17% of its GDP.

Implementing a Medicare For All system, similar to what Canada enjoys, would save American households thousands of dollars annually and eliminate over 500,000 bankruptcies each year that occur because of medical emergencies within families.

Countries like Switzerland, Germany, France, Sweden, and Japan spend about 11% on healthcare, whereas Canada, Denmark, Belgium, Austria, Norway, Netherlands, the United Kingdom, New Zealand, and Australia spend between 9.3% and 10.5%.

Currently, health insurance premiums account for about 22% of all taxable payroll, but a Medicare For All system would only require an estimated 10%.

The US is the only developed nation with a multi-billion-dollar for-profit industry that profits massively by managing healthcare funds on behalf of its citizens, acting much like a giant, bloodsucking tick.

Efforts to change this system have been ongoing.

Presidents like Theodore Roosevelt, Franklin Roosevelt, Harry Truman, John Kennedy, and Lyndon Johnson all attempted to introduce national healthcare systems in the US. A notable instance includes President Kennedy advocating for a single-payer system, distinguishing it from Britain’s socialist approach:

However, these efforts did not succeed. In my deep exploration for my book The Hidden History of American Healthcare, I identified two primary obstacles to eradicating this issue.

Initially, over a century ago, resistance to a national healthcare system stemmed from Southern white lawmakers who opposed any potential benefit to Black Americans from white taxpayers’ money. This mindset persists among many politicians in the South today.

Frederick Hoffman, a German immigrant and a key figure in this movement during the late 19th and early 20th centuries, worked as a senior executive at the Prudential Insurance Company. He authored several books and lectured nationwide on the supposed racial inferiorities of Black people. His most famous book, Race Traits and Tendencies of the American Negro, argued that without healthcare, the Black population would diminish within a few generations. This book, published in 1896, became a bestseller and significantly influenced the era of legalized segregation in America.

Hoffman’s ideas were widely embraced by Southern politicians, and he was often called to speak before Congress, celebrated as a pioneer of “scientific racism.”

As Prudential moved into health insurance in the 1920s, Hoffman had even more reason to lobby against national healthcare plans.

The second major barrier to a national healthcare system in America is profit.

For instance, “Dollar” Bill McGuire, a former CEO of UnitedHealth, earned about $1.5 billion during his tenure. Despite a legal settlement that required him to pay $468 million, he left the company as a billionaire. His successor also accumulated around half a billion dollars.

These executives, among others in the industry, earn their fortunes largely by denying claims, which contributes to the profitability of their companies. This practice led Cigna Vice President Wendell Potter to resign after a personal tragedy involving a denied claim. He later wrote Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR Is Killing Healthcare and Deceiving Americans.

In most developed countries, primary health insurance markets like those in the US are nonexistent or significantly smaller. Where private health insurance exists, it typically caters to the wealthy, offering luxury services outside the standard national coverage.

Many Americans may not be fully aware of these facts, but they sense the disparity.

In the 2020 election, expanding Medicaid was one of the highest-voted issues across the nation, even surpassing President Joe Biden’s victory in popularity. Other popular issues included increasing the minimum wage and legalizing marijuana.

The last major advancement in government-funded healthcare, the establishment of Medicare and Medicaid, occurred in the 1960s under President Lyndon Johnson. Since then, the size and influence of the health insurance industry have grown considerably.

The Supreme Court’s decisions in Buckley v Belotti in 1978 and Citizens United in 2010 have made it increasingly difficult to replace profitable industries with government-funded alternatives, even if they would benefit the public.

Adopting a Medicare For All system would save billions and reduce bankruptcies significantly, but it would also cut into the immense profits that a few corporate giants make each week. This change is unlikely under a billionaire president, but if we aim to modernize America’s healthcare by the next administration, we need to start mobilizing, planning, and educating voters now.

It’s a substantial challenge: keep it on your agenda and share the information.