Why Is Healthcare So Expensive?

By Frank Tucker | Jul 23, 2019

In the United States, most citizens are familiar with the high costs of healthcare services. These high prices can be seen in all types of care, whether you visit your general practitioner or undergo major surgery.

In 2021, the United States spent an estimated $12,318 per person on healthcare services. This is the highest cost per capita among all countries studied. Multiple factors contribute to these high prices, some of which include:

  • Increased prices for services based on complexity
  • Price increases for drugs due to lack of government regulation
  • Spikes in specialist treatment that demand higher fees
  • Unmanaged administrative costs

The Importance of Healthcare Despite Rising Costs

With such high costs for healthcare, many people may be turned away from care as a whole, even with insurance covering a percentage of their bills. The expense may turn people away, but healthcare is still critical to society. Comprehensive healthcare:

  • Achieves health equity for Americans
  • Prevents and manages disease
  • Reduces premature death and unnecessary disability
  • Promotes lifelong health and high quality of life

These factors may be enough to convince some Americans about visiting their physicians, but it’s clear that cost reduction is also essential for making healthcare more appealing to the population. Healthcare organizations do not have complete control over their costs, especially with limited government regulation, but they can enact changes internally to reduce their expenses and the overall cost of care.

Solutions for More Accessible Care

Hospitals and healthcare organizations face extensive administrative and operational costs. While a lot of these costs are necessary, some of them are a result of inefficiencies that providers can correct with new approaches.

Healthcare administration costs account for 15% to 30% of the country’s total medical expenditures, and a lot of it is related to billing and insurance needs. These processes are complex, especially when handled manually, and many organizations still do despite technological improvements that could streamline the process.

One way for organizations to reduce their administrative overhead is to rely on cloud computing through electronic health records (EHRs), applications and other tech solutions. The world of health technology continues to grow, and many clinics and hospitals remain slow on the uptake.

Cloud computing solutions can:

  • Integrate AI and machine learning to manage billing procedures
  • Introduce telehealth appointments for more accessible care
  • Improve communication between physicians for more streamlined care management
  • Offer easier payment solutions for patients
  • Reduce reliance on manual administrative processes

When clinics and hospitals create a more connected ecosystem through cloud technology and data management, every process can run more smoothly. Additionally, many cloud platforms use Software as a Service (SaaS) models to make expenses predictable and manageable for healthcare organizations.

Contact MicroHealth for Healthcare Technology

At MicroHealth, we understand how technology solutions empower healthcare organizations and help reduce unnecessary spending. We offer a range of solutions, such as EHR servicessoftware development and integrationcloud application development and health informatics to make your organization more efficient. Find ways to cut your administrative costs so the general population gets the care they need.

Contact us today for more information about our services.


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