Why are Medical Expenses in the US so Expensive?

Represents Expenses in The Medical Care System-Money Going Away Due to High Costs

Represents Expenses in The Medical Care System-Money Going Away Due to High Costs

Alexius Mancl, Hour 5B

Almost everyone in the U.S. visits some type of doctor. Whether that be a Physician’s assistant, M.D., E.R. Doctor, or Pediatrician. 860.4 million people a year visit medical providers. How much does this cost? And why is it so expensive? Why is our care so expensive? This is a question a lot of Americans wonder about and that is what we are trying to find out.

Rising Medical Expenses

Medical expenses have gone up significantly in the past twenty years. According to a New York Times article, ”the health sector grew at a 4 percent annual rate, while the overall economy grew at a 2.4 percent rate.” Authors Austin Frakt and Aaron E. Carroll prove that huge increases in the prices of medical care occur frequently. This is possibly due to inflation, overall economic growth, but also the increase in the need for medical providers. We are increasing drastic amounts going from spending around $930 billion in 1996 to $2.1 trillion in 2016, and finally to 4.1 trillion this year as mentioned earlier. 

However, with medical expenses in the United States, people often suggest that the amount of time spent in hospitals was the reason for the uprise in expenses. Authors Austin Frakt and Aaron E. Carroll emphasize: “though we did have more doctor visits and used more prescription drugs. These tend to be less costly than hospital stays, so, on balance, changes in health care use were associated with a minor reduction (2.5 percent) in health care spending.” Confirming that hospitals are not the cause of the high expenses. According to the CDC (Centers for Disease Control and Prevention), stated that in 2021 in the United States 82.3% of adults went to the doctors or visited some type of health care provider (Nurse Practitioners, Physician Assistants, Emergency Room, M.D., etc.). All of these costs together add up to 4.1 trillion a year.

US expenses V.S. other countries

The United States healthcare system is more expensive than other countries. The only difference is that the United States spends and charges substantially more on medical care and expenses than other countries. The US government spends about $4.1 trillion a year on medical expenses which are about 60% more than other countries. “Almost every other high-income country provides better and more affordable healthcare than the U.S. Several lower-income countries also rank higher. The U.K.’s healthcare system is low-cost and generally ranks quite highly (author Aaron Hankin states).” Certainly higher than the U.S. But why is it this way? Why does such an advanced country have such an expensive healthcare system? From Investopedia author Aaron Hankin also mentions,

The average cost in the U.S. is $29,067, which is $10,000 more than the next highest-cost country, Australia. However, the data show that the 95th percentile cost in the U.S. reaches $57,225, which is $50,000 more than the average price in South Africa and $42,000 more than in New Zealand. The cost in the U.S. for an MRI scan was $1,119, compared to $811 in New Zealand, $215 in Australia, and $181 in Spain. Certain types of cancer, have an average price of $3, 930 in the U.S. Switzerland is the second most expensive at $1, 752 however, the data found that the 95th percentile in the US paid up to $8, 831.Avastin(a cancer treatment) cost $470 in the UK.

This data showed that the 95th percentile in the price of this procedure in the U.S. was $3,031, meaning some people are paying nearly $3,000 more for a standard MRI scan in the U.S. than the average person in Australia and Spain. Showing expenses are drastically more expensive in the U.S.


Expenses in medical care depend on age, sex, and the personal needs of a person. These expenses also depend on the majority needs of your group. This means that depending on the specific needs of you, and everyone else in the U.S. the more common your need the less expensive it will be. “Ways to lower these expenses could be lowering the cost of prescription drugs, accelerating the adoption of value-based care models, and increasing price transparency for consumers and employers,” says the west health organization. These solutions would raise costs for everyone in the U.S. and make these services more affordable and available.