In business, if we want to lower costs, we need to eliminate waste and drive efficiencies. We have incentive to do that to remain profitable. We cannot endlessly increase prices and expect to keep our customers. In order to stay profitable, we have to keep a healthy balance that ultimately provides value to our customers and keeps them coming back.
Some industries are guaranteed customers. A prime example is health care. If they eliminate waste, drive efficiencies AND increase costs, they won't loose a large percentage of their customer base. We have witnessed this for decades. Long before the ACA, hospitals have consistently cut staff, consolidated, and raised prices. Drug companies have consistently increased the prices of nearly all drugs and related products. Insurance companies have consistently increased rates and lowered the types of services they insured. Deductibles and co-pays consistently rise.
The ACA didn't help because it failed to address the underlying causes of these increases. It failed to address systemic waste and inefficiencies. The ACA tried to address the cost of health care with a market driven approach. Drive more consumers into the system and the costs will go down. Indeed, 13 million more people entered the health system but insurance companies are saying those are not enough. Costs have still gone up. Now, everyone, including those 13 million are questioning how they can possibly afford those additional costs. They are asking why or blaming the ACA.
One part of the logic is entirely correct. If everyone in the country is paying into the health care system at a sufficient amount, there would be sufficient funding for everyone to have the health care needed. Currently, every working person pays into the Social Security, medicare and medicaid fund. Most of us won't benefit from that until we reach age 65.
Because the costs of health care keep rising, there's alarm that these programs (medicare and medicaid) are not properly funded. We often hear congress talk about eliminating or cutting these "entitlement" programs. Once again, they are failing to address the underlying issues that are causing these increases and resulting in underfunding.
The health care industry is profit driven. Unlike other free market endeavors that are customer driven - consumers have choices about whether to purchase or not - consumers of health care have little choice. If you have a broken and shattered leg, you can't decide NOT to seek health care. If you're in a serious car accident, have a stroke or heart attack, you will be taken to the hospital. If you need insulin to survive, you can't simply decide not to get it. The health care industry is guaranteed consumers. Consumers are guaranteed what?
If we want health care costs to go down, we need to take a systemic look at all the areas where costs are going. The insurance companies and their shareholders are taking a share. Profit driven hospitals and their shareholders are taking a percentage. Pharmaceutical companies and their shareholders are taking a percentage. The legal system and constant lawsuits at all levels are taking a percentage. What does that leave for actual direct health care?
There are certain areas of society where free market is simply not going to work. Health care is a prime example. What's sick in the United States health care system is the percentage of money going into the system that is going to profiteers. That's the largest area of waste that we need to address. The only way that can happen is with a single payer system, just like medicare and medicaid. We have to remove costs from the system and the largest areas of cost are going to profits.
The reason we have not heard about a substantive replacement for the Affordable Care Act, is that there is no other way to lower health care costs. Most of the rest of the industrial world has realized this but we're so stuck on the idea of "free market" capitalism that we'll spin our wheels for a while yet.