The idea of a single, equitable healthcare system is often a myth. Regardless of the official structure, a cash-pay system for faster or better care will almost always emerge for those who can afford it, a reality policymakers must acknowledge.
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In the US, where public health is not a political priority, the catalyst for policy change promoting healthier living will be fiscal. The government cannot afford the current trajectory of healthcare spending, which will eventually force changes in housing, food, and community planning.
Rising premiums and deductibles are pushing people away from traditional insurance. This isn't an abandonment of healthcare, but a market response to a product that no longer provides adequate value, forcing a shift towards cash-pay and alternative models.
While deregulation has made consumer goods like TVs drastically cheaper, essential family needs like healthcare, education, and housing have seen costs skyrocket. This suggests market dynamics that work for consumer electronics fail to provide affordable necessities for the average family.
A paradoxical market reality is that sectors with heavy government involvement, like healthcare and education, experience skyrocketing costs. In contrast, less-regulated, technology-driven sectors see prices consistently fall, suggesting a correlation between intervention and price inflation.
The imbalance between rising drug development costs and financially strained public health systems is unsustainable. Novo Nordisk's CEO believes this will inevitably lead to a global trend of increased patient cost-sharing through cash channels and high co-pays, moving beyond traditional insurance models.
By insuring millions more Americans, the ACA created a new, guaranteed government-backed revenue stream. This made healthcare an extremely attractive and low-risk target for private equity firms, accelerating the industry's financialization.
The rise of cash-pay proactive health creates a two-tier system. One group can afford to defect from insurance and build their own health stack, while another cycles through the traditional system, relying on charity care, exacerbating inequity.
As more people opt out of insurance, they may delay preventative care and rely on expensive emergency rooms when issues become critical. This uncompensated care inadvertently increases costs across the system, a problem the Affordable Care Act aimed to solve.
The median $40,000 cost per trial enrollee is high because pharma companies essentially run a parallel, premium healthcare system for participants. They pay for all care and level it up globally to standardize the experiment.
The core issue preventing a patient-centric system is not a lack of technological capability but a fundamental misalignment of incentives and a deep-seated lack of trust between payers and providers. Until the data exists to change incentives, technological solutions will have limited impact.
