Healthcare Costs: The Damaging Effects of Expensive Medical Care

Medically reviewed on July 25, 2023 by Morgan Spicer, Medical Communications Manager. To give you technically accurate, evidence-based information, content published on the Everlywell blog is reviewed by credentialed professionals with expertise in medical and bioscience fields.

Table of contents

• Why Is Healthcare So Expensive?
• Why Expensive Healthcare Is a Problem
• How to Prioritize Your Health on a Budget
• Virtual Care with Transparent Pricing Through Everlywell
• Related Content

Healthcare costs in the United States have risen in recent years, leading to worsening health outcomes, skipped treatments, and increased financial strain. Let’s examine the causes and effects of high healthcare costs.

Why Is Healthcare So Expensive?

So what makes healthcare so expensive? There are many factors at play, including rising drug costs, wasteful systems, profit-driven healthcare centers, and more. [1] People living in the United States are subject to unregulated costs, leading many to pay over double the price for prescription drugs as those in other developed countries. [1] Medical professionals in the United States are also charging more than those in other countries, leading to a price increase for various services and healthcare products. [1] Insurance companies that offer confusing plans and service restrictions require more administrative costs to help consumers and providers navigate the many coding, billing, and usage regulations put in place. [1] These are just a few of the many factors that contribute to the steep healthcare costs in the United States.

The Average Cost of Healthcare Services in the United States

Let’s break down the costs of medical care for the average person. For those that are paying for medical insurance, monthly costs can range from a few hundred dollars to over $1,000 a month. [2] While insurance can help you pay for many services, there are often still added costs like co-pays, prescription costs, out-of-network services, and more you may be responsible for.

If you are seeking care without health insurance, you’re likely to pay nearly double what an insured person would pay. [3] A simple service such as a few stitches can come with a price tag of $150 or more, and the need for an ambulance ride can cost someone up to $3,200. [3-4] Forbes reports that giving birth in a medical facility without health insurance can cost around $19,000, and may still cost over $3,000 with medical insurance. [5] It is important to note that costs can vary greatly depending on your location, insurance plan, type of service, and more.

Why Expensive Healthcare Is a Problem

Costly healthcare can lead to poor health outcomes, worsened wealth disparities, delayed care, and more.

Wealth Disparities and Financial Strain

Research shows that the high costs of medical care, including high insurance costs, worsen income inequality and impoverish millions of Americans. [6] People living in impoverished areas are far more likely to be living in food deserts, defined as areas where the local community has limited access to affordable and healthy food. [7] As a result of these factors, adults and children living in poverty are more likely to experience chronic illness, nutritional deficits, substance use, obesity, and other health conditions. [8] A Federal Reserve survey further supports these claims, reporting that those who are able to afford costly healthcare are more likely to be in good health. [6] According to the survey, families with an annual income of less than $25,000 were less likely to report being in good health than those with an income of $100,000 or more. [9]

To summarize, poverty creates an unfortunate cycle of negative health outcomes, inability to pay for appropriate healthcare, and worsened financial strain when families do seek out or require healthcare. [6-9]

Skipping or Delaying Care

In addition to many families being unable to afford quality healthcare, many report skipping healthcare appointments or treatments due to high costs or lack of health insurance. [9] According to the Federal Reserve, the amount of Americans who skipped some form of medical treatment rose exponentially in 2022 compared to the previous two years. [9] Additionally, a survey conducted earlier this year by the American Academy of Physician Associates (AAPA) and The Harris Poll reported that nearly 40% of respondents skipped or delayed care for long periods of time due to the cost of services. [10] Delaying or skipping care may lead to worsened health outcomes or an increased risk of developing chronic conditions and illnesses. [11]

Other Issues with Healthcare

Not only is health care in the United States expensive, but there are other factors at play making medical care, especially in-person care, very difficult to navigate. According to one AAPA study, many Americans feel the healthcare system is not meeting their needs because of [10]:

• Insurance limitations
• Long wait times for appointments
• A focus on treating illness and injury over preventive care
• Care is poor quality
• Not enough providers are available
• Difficulty navigating medical care

Outside of these limitations, there is a staggering difference in healthcare outcomes when factoring in determinants such as housing, environment, language, race, gender, and sexuality. [12] According to the World Health Organization (WHO), these social determinants of health can impact over half of all health outcomes. [13] Health inequities leave many, specifically people of color, with poor access to quality healthcare. Read more about these Challenges in Healthcare

How to Prioritize Your Health on a Budget

Managing your health can be stressful, especially if you are concerned about the cost of medical care. Here are a few tips for keeping up with your medical care while keeping finances in mind.

Preventive Care

The Centers for Disease Control encourages regular preventive care and screenings to stay on top of your overall health. [11] Regular care includes dental cleanings, vaccinations, screenings, and physical exams that can help with the prevention or early detection of many different illnesses and conditions. [11] Getting regular care may actually save money in the long run by decreasing the risk of chronic illness and the need for expensive ongoing care. [10-11]

Utilize Free or Low-Cost Services

Many people aren’t aware of the various programs available to help with prescription drug costs, vaccinations, and other services. Depending on your income and family size, you may qualify for programs such as Medicaid, patient assistance programs, nonprofit programs, and more. [14-15] These services may be able to offer you insurance coverage or help with the costs of various healthcare services. Some healthcare centers, like Urgent Care, also offer discounted rates for people paying out of pocket for care. [3]

Look into Telehealth Services

Telehealth or telemedicine services utilize communication technologies in order to connect patients to healthcare providers. Telehealth services eliminate the need for in-person office visits, which may help cut down on certain costs. Connecting with a provider from the car, at home, or in the breakroom means there is no need to pay for transportation to a doctor’s office or take time off work. [16-18] Some research also shows that telehealth services often cost less than in-person care, averaging about $40 to $50 for a virtual appointment and up to $176 for an in-person appointment. [16-18]

Virtual Care with Transparent Pricing Through Everlywell

It’s no surprise that high healthcare costs in the United States lead many to delay care or experience financial strain. There isn’t an easy way to explain the cause of these high medical costs, nor is there a one-size-fits-all solution. At Everlywell, we are committed to providing affordable, transparent pricing for virtual care visits as well as at-home lab tests.

Related Content

What Is the Cost of Telehealth?

Is Telehealth Cheaper Than an Office Visit?

How Much Is a Telehealth Visit With Insurance?

References

1. Boyle, M. Velasquez, V. 6 Reasons Healthcare Is So Expensive in the U.S. Investopedia. June 13 2023. URL
2. Masterson, L. Megna, M. How Much Does Health Insurance Cost In 2023? Forbes Advisor. May 8 2023. URL.
3. Kissel, C. Masteron, L. How Much Does An Urgent Care Visit Cost In 2023? Forbes Advisor. October 2022. URL.
4. Ground Ambulance Services in the United States. A FAIR Health White Paper, February 23, 2022. URL.
5. Rivelli, E. Masterson, L. How Much Does It Cost To Have A Baby? 2023 Averages. Forbes Advisor. March 2023. URL.
6. Christopher AS, Himmelstein DU, Woolhandler S, McCormick D. The Effects of Household Medical Expenditures on Income Inequality in the United States. Am J Public Health. 2018;108(3):351-354. doi:10.2105/AJPH.2017.304213
7. Dutko, Paula, Michele Ver Ploeg, and Tracey Farrigan. Characteristics and Influential Factors of Food Deserts, ERR-140, U.S. Department of Agriculture, Economic Research Service, August 2012.
8. Khullar, D., & Chokshi, D. A. (2018). Health, income, & poverty: Where we are & what could help. Health Affairs Health Policy Brief. https://doi.org/10.1377/hpb20180817.901935
9. Economic Well-Being of U.S. Households in 2022. Board of the Governors of the Federal Reserve System. May 2023. URL.
10. The Patient Experience: Perspectives on Today's Healthcare. AAPA, The Harris Poll. 2023. URL.
11. Health and Economic Costs of Chronic Diseases. CDC. National Center for Chronic Disease Prevention and Health Promotion. March 23 2023. URL .
12. Social Determinants of Health. U.S. Department of Health and Human Services. URL. Accessed July 2023.
13. Social Determinants of Health. WHO. URL . Accessed July 2023.
14. Pharmaceutical Manufacturer Patient Assistance Program Information. Centers for Medicare & Medicaid Services. December 2021. URL.
15. Medicaid Eligibility. Centers for Medicare & Medicaid Services. Accessed July 2023. URL.
16. Rehm J. Telemedicine: The cost-effective future of healthcare. AJMC. December 6, 2016. Accessed July 2023. URL.
17. Lovell T, Albritton J, Dalto J, Ledward C, Daines W. Virtual vs traditional care settings for low-acuity urgent conditions: an economic analysis of cost and utilization using claims data. J Telemed Telecare. 2021;27(1):59-65. doi:10.1177/1357633X19861232. URL.
18. Reed ME, Huang J, Graetz I, et al. Patient characteristics associated with choosing a telemedicine visit vs office visit with the same primary care clinicians. JAMA Netw Open. 2020;3(6):e205873. doi:10.1001/jamanetworkopen.2020.5873. URL.