I think the root cause of the problem is not insurance companies but they definitely do play a part. The real reasons are multiple but can be listed as below.
1 A very high cost of drugs due to no intervention by the government as part of free market philosophy. This means that the same insulin that costs $25 in Canada can be sold for up to $1000 per month. New introduced drugs for Alzheimer's or other diseases can cost up to 50k per year - again because no price controls.
2. Insanely high prices of services due to a captive market - example a ten minute ambulance ride can cost up from $1000 to $5000. The private ambulance companies know they can charge a high base rate because they are connected to a city or municipality via contracts. Bribes as campaign funds are popular here. E.g. a new York based ambulance operator paid 45k in campaign funds to NY's governor elect and got a contract worth one billion dollars
3. Overcharging by hospitals for medicines and services again due to a captive audience. The hospitals are free to maintain various price books and you are not told what each service will cost at the time of administration of service. lately the hospitals have been forced to open up their price books but they are so convoluted that no normal human can decipher those prices.
Thus a ten cent aspirin would cost you $25 in the hospital and a MRI can run up to 15k.
4. Very high charges for doctors due to strict control on the number of MD positions and no increase in colleges or D seats over multiple years.
5. Insurance companies have a for profit motive and need to extract their profits from premiums paid. Thus they fight tooth and nail to deny procedures and medications and set up convoluted processes for appeals.
6. Extensive fraud on Medicare and other government run health programs especially in durable medical goods and fake billing. In fact one of sitting US senators medical care company was involved in the largest Medicare fraud fines in the US and he still holds his seat.
1 A very high cost of drugs due to no intervention by the government as part of free market philosophy. This means that the same insulin that costs $25 in Canada can be sold for up to $1000 per month. New introduced drugs for Alzheimer's or other diseases can cost up to 50k per year - again because no price controls.
2. Insanely high prices of services due to a captive market - example a ten minute ambulance ride can cost up from $1000 to $5000. The private ambulance companies know they can charge a high base rate because they are connected to a city or municipality via contracts. Bribes as campaign funds are popular here. E.g. a new York based ambulance operator paid 45k in campaign funds to NY's governor elect and got a contract worth one billion dollars
https://www.wkbw.com/news/state-news/report-nysdoh-awards-mu...
3. Overcharging by hospitals for medicines and services again due to a captive audience. The hospitals are free to maintain various price books and you are not told what each service will cost at the time of administration of service. lately the hospitals have been forced to open up their price books but they are so convoluted that no normal human can decipher those prices.
Thus a ten cent aspirin would cost you $25 in the hospital and a MRI can run up to 15k.
4. Very high charges for doctors due to strict control on the number of MD positions and no increase in colleges or D seats over multiple years.
https://www.aamc.org/news/press-releases/new-aamc-report-sho...
5. Insurance companies have a for profit motive and need to extract their profits from premiums paid. Thus they fight tooth and nail to deny procedures and medications and set up convoluted processes for appeals.
6. Extensive fraud on Medicare and other government run health programs especially in durable medical goods and fake billing. In fact one of sitting US senators medical care company was involved in the largest Medicare fraud fines in the US and he still holds his seat.
https://www.justice.gov/archive/opa/pr/2003/June/03_civ_386....
Infact fraud billing Medicare for services not rendered is so popular that even Insurance companies do it
https://oig.hhs.gov/fraud/enforcement/united-states-interven...
Combine all the above factors and you will see why the US consumer gets so little while paying so much for his healthcare.