The American Health Insurance Crisis

My Story

Our medical insurance premiums went up by 35% for 2026. We have a middle-of-the-road plan that tries to balance all the different factors. We don't qualify for ACA subsidies and going through the open market is cheaper than getting a small group plan for my wife's business. Because a small group plan is so expensive, all of her employees must go through the open market or have medical insurance through their spouse's workplace.

Our medical premiums going up significantly is not a new trend. My health insurance has been getting more costly for 40 years. When I first started working, medical coverage was entirely provided by my employer. Over time it became more costly and my employer began sharing the cost with employees. That is, the company paid for part of the coverage and employees had to pay the rest. In an effort to defray the cost, the percentage paid by employees rose. Over my 40-year career there were a couple of times where I was between jobs due to layoffs resulting from economic downturns. In both cases I was without medical coverage. In the first case, the company I joined after the layoff didn't offer medical coverage. Because open market insurance was unaffordable, I went uninsured for several years until my employer finally offered a subsidized group plan. Luckily, I did not get seriously ill or injured during that time. In the second case, it took some time before I found work as an independent contractor without benefits. Once again, independent medical coverage was unaffordable and I went without until I became an employee at a company that offered medical insurance as part of the benefit package.

Comparing Healthcare In The US To Other Wealthy Countries

There is a mountain of data that shows that Americans pay more than other countries. There is also a mountain of data that we have worse outcomes, even though we pay more.

  • On average, American healthcare expenditures are almost double compared to other similar wealthy countries such as Switzerland, Germany, Austria, Netherlands, Sweden, Belgium, France, Canada, Australia, United Kingdom, and Japan. (Healthcare Costs - US vs Other Wealthy Countries)
  • Administrative costs represent about 7.6% of overall health spending in the U.S. compared to 3.8% on average in comparable countries. (What Drives The Cost of Care)
  • Americans spend twice as much in administrative cost and much less on long term care compared to other wealthy countries. (How Does Healthcare Compare)
  • The US Spends more than twice as much on healthcare and has lower life expectancy than Japan, Canada, Netherlands and UK. (Spend More Get Worse Outcomes)
  • Americans pay a much larger percentage of GDP on healthcare compared to other wealthy countries and has worse outcomes. The differences in cost and outcomes between Australia, Canada, France, Germany, the Netherlands, New Zealand, Sweden, Switzerland, and the United Kingdom are relatively small. The United States is the clear outlier in a bad way. (A Portrait of the Failing US Health System)
  • The Legatum Institute, a London-based think tank, has studies what drives success in nations. In their annual evaluation, they include a “Health Pillar” that ranks 167 countries based on the overall health of their societies and the accessibility of tools to maintain health, including healthcare services. The US is not in the top third; ranking 69th, just behind Bulgaria, Albania, Jamaica, and Armenia. Good news though; we rank just ahead of Algeria, Mexico, and Romania. (Legatum Prosperity Index)
  • US global ranking on various healthcare outcomes. While the below global rankings include all countries, generally speaking the US ranks last when compared to other OECD countries. While the US tends to perform well with acute condition outcomes, it tends to perform very poorly with long-term or chronic conditions (diabetes, hypertension, long-term care).

    • 49th - Life Expectancy
    • 54th - Infant Mortality
    • 55th - Maternal Mortality
  • Americans (typically the uninsured and underinsured) use the Emergency Room for care that could have been provided by a primary physician or because they don't have a primary physician 30% more than than the average of other OECD countries. Emergency Rooms are the most expensive method of getting care. When they cannot pay for the care, it gets absorbed by the hospital (usually a public/county hospital that cannot refuse uninsured patients). As a result, the hospital is forced to recover the cost by charging everyone more. Kicking people off medical insurance doesn't save America money; it costs us more.
  • Insurance companies are sucking boatloads of money out of the system. The seven largest insurers (UnitedHealth, CVS/Aetna, Cigna, Elevance, Humana, Centene, and Molina) raked in $71.3 billion in profit in 2024. That's over $70 billion in healthcare that we paid for but didn't receive.
Once again, we are the outlier compared to other wealthy countries and can learn from what they are doing well.

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