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To add my own anecdote about US healthcare, I needed a hernia repair surgery in my early 20’s.

My dr referred me to a specialist, I asked if he was in network for my insurance and everything seemed good. But in what I have since come to realize is a quintessential US healthcare experience, it turns out the facility that this independent surgeon used and the anesthesiologist were not in network. Nobody bothered to tell me about this before the surgery, so I went through with it.

Later I see the bill is about $39k, and my insurance has decided they’ll pay $1174. I was freaking out, but I got a call from the billing department and they asked if I could just pay $200, which I did and they called it a day and everything was settled.

It makes just as little sense as any of the horror stories I’ve heard, but somehow worked out pretty reasonably for me. I still have no idea how this happened. Did I get incredibly lucky? Or are more of these horror stories you hear where someone “ended up with a $50k medical bill”, just on paper and those amounts rarely actually need to be paid?

Makes me think they can write it off their taxes as "uncollectable."

Yes, but they also had to add 50k of uncollectable revenue. So its not really doing anything for them for their taxes.

It's mostly a game played between insurance provider and medical provider. They ask for 50k--knowing it the insurance is going to low ball them.

If they write off $39k, that counts against $39k in other income they actually get that they then don't have to pay taxes on.

Two anecdotes in support of your last sentence:

I once paid cash up front for a procedure, charged at 25% of the insurance rate. This was put in writing as the total cost of the procedure. Afterwards, they billed me as if I owed 75% of the other rate, with threats of legal action accompanying invoices. I did not immediately locate in my files my copy of the initial contract. Like you, I was freaking out. Even after finding my copy, and knowing that I would prevail in court if it came to it, I worried about all the indirect ways the situation could harm me. Eventually they dropped the issue.

A friend agreed to a few procedures without knowing the price, and was then charged a bizarre, absurd amount of money (I comparison researched, after the fact). He offered to pay 50%, and they gladly, eagerly accepted. I heard the call, they sounded surprised and happy. Clearly he could have paid much less.

My dad’s been a chronic diabetic for 25 years, and we’ve never had a large surprise medical bill.

Even among people who file for bankruptcy, most have little medical debt: https://www.forbes.com/sites/aparnamathur/2018/04/09/exposin...

> Department of Justice did a similar survey of bankruptcy filers between 2000 and 2002, which included a much larger sample of 5,203 filers, and found that 90 percent of filers had medical debts less than $5,000, and 54 percent had no medical debt.

We’re talking about 10% of 1% of people that file for bankrupt y and have more than $5,000 in medical debt.

The other thing people don’t mention is the aggressive cost controls in other countries. In the U.K., the NHS will pay $30k on average for treatment that is expected to increase life by one quality-adjusted year: https://www.kingsfund.org.uk/publications/articles/ministers.... For cancer, etc., it’s double that.

> NICE has on occasion approved treatments that cost more than £30,000 per QALY. In addition, since 2009, there has been a higher threshold of £50,000 per QALY for end-of-life care, which in practice has applied chiefly, although again not exclusively, to cancer drugs.

In the pre-Obamacare days when there were lifetime limits, you’d see stories of people blowing through a $1 million limit, and then dying a couple of years later $500,000 in debt. Tragic yes, but in the U.K. or Germany these people would have been counseled into hospice instead.

https://www.politico.eu/article/cancer-europe-america-compar...

> Speedy access to cutting-edge treatments cuts deep into America’s national purse. One study, summarized in the New York Times, determined that the U.S. averted 265,000 more deaths of colorectal cancer compared to Western Europe between 1982 and 2010. Each year of healthy life gained cost $110,000. The costs for gains in prostate and breast cancers were even more dramatic.

The incremental lives we saved in the US for these cancers came at a cost double that of what would have been approved by the U.K. NHS.

Finally, the other thing most people don’t mention is that Americans have vastly more money in their pockets due to higher incomes and lower taxes: https://images.app.goo.gl/n8Qs8eBa84yuo3by7

There is a small chance that, in the US, you’ll get cancer or have a heart attack, and fall through the cracks of health insurance, Medicaid, and Medicare. But you pay a significant price for reducing that risk.

Would statistics on medical debt be skewed by a society that has potentially grown accustomed to turning away medical aid for fear of the financial fallout?

Maybe, but are there statistics to support that? People point to things like the U.S. lagging on indicators like maternal and infant mortality, and life expectancy. But if you dig into the data, non-white Hispanics (which have a 20% uninsured rate) have similar maternal and infant mortality to whites (which have only a 5% uninsured rate). And hispanics have significantly longer life expectancy. American hispanics, despite widespread lack of insurance, live as long as people in Denmark or Sweden, who have comprehensive universal health care. Moreover, Asian Americans, which have a slightly higher uninsured rate than whites, live the longest of any people anywhere in the world. They live 2-3 years longer than people in Hong Kong or Japan. (And trust me, there is no secret health system for us Asians. We have the same shitty UHC or Cigna insurance everyone else does.)

There is a lot of rhetoric in this area, but few firm conclusions to be drawn.

Where are you deriving these stats for Asian Americans and do they split out south vs east Asian?

Yep.

That's because in Germany, "healthcare" is about caring for your health.

In the US "healthcare" is about keeping laborers productive. Anyone who can generate value for capital will get the care they need to remain productive. When the cost of that care exceeds the value they generate, they are not covered. Public assistance programs are really just the bare minimum that is necessary to keep the following QOL issues from popping up in view of the upper class: homeless overrunning the streets, shantytowns and slums, rioting, black markets.

While I don't wish for this level of utilitarianism and inequality, I do wish our system here in the US had this level of organized clarity that you are describing. I think instead much more of the problem needs to be attributed to sheer incompetence and bureaucratic inefficiency.

Recently I went to the local medical center and had got some basic checkups and diagnostics. The healthcare was fine, but the billing and medical record interactions were terrible. The negotiation about the amount I owed, which was always in the $50-150 range, was dragged out over six months and involved five different corporations (the medical center, their independent billing agency, the collections agency, my insurer, and my insurer's third party negotiation firm). It went to collections even though all parties had agreed it should be on hold pending the "investigation", which never seemed to bring any new details to light. Then finally they lowered it significantly at the end and never provided a reason why it was different.

> I paid a grand total of ~€500 despite being self-employed at the time (so I only had standard public insurance everyone in Germany gets).

IMO, this is a somewhat misleading statement as Germanys public insurance (that everyone can sign up for), costs quite a lot. Normally the employer would cover 50% of the contribution, but as you mentioned being self-employed that could easily be over 800 Euros per month.

That doesn't quite tip the scale in favour for the US, but the differences between the two health care systems are more nuanced as you're making it out to be.

PS: From personal experience, I find that health care providers in North America will jump to expensive tests or hospitalization much quicker than European counter-parts. I don't know if that's common (I don't have enough data-points) but this could be another factor explaining the difference in cost.

If you read down-thread I compare total taxation+insurance costs.

I believe that outside the absolute top couple of % of wage earners German total costs are similar to high-tax US states like California.

The costs for public health insurance is 14-15% of your income with a lower income bound of 1061,67€ and an upper bound of 4687,50€. Thus the minimum cost is 148€ and the maximum is 656€ (for the exact same service).

In addition you need to pay 3% Pflegeversicherung (nursing care insurance).

https://www.krankenkassen.de/gesetzliche-krankenkassen/krank...

I thought everything is covered after you got your total out of pocket expense (~$6k IIRC) in the traditional PPO healthcare plan? How did your friend get hit with $65k?? Out of network doctors/hospital?

I have no idea, I didn't dig in as it seemed a touchy subject. But I have heard similar anecdotes from other Americans.

I don't buy your story either. Extraordinary claims require extraordinary proof.

Which is the extraordinary one, my friend getting handed a massive bill or me getting a small one?

It's very possible he could have haggled it down but why should you need to? Especially in a vulnerable situation like after getting out of cancer treatment.

I can guarantee you I wouldn't have had the wherewithal to fight it in his spot. I barely managed to do anything for 6 months after getting out of my own cancer treatment (and for psychological, not pyshiological reasons).

If I had cancer in the US a $65k bill really isn’t bad. Consider in the US taxes are typically <20%. So if you make $100k a year, you pay $20k in taxes. So you have $80k, minus insurance (let’s eat $500/month) you have $74k

In Germany (if I recall) it’s closer to 50% taxes so $50k a year.

Presumably you can expect cancer once or less, but effectively you only need ~4 years of income to make up for that $65k bill in the US. Not bad at all. Obviously that differs based on income, but you can a see how (for many people in the US) the system works great

Total income-related taxes+health insurance in California are IIRC similar or higher than Germany. Also in either case the taxes on $100k/year are way less than 50%.

EDIT from what I can tell from very quick googling total taxes on $100k in California would be ~29% (not including health insurance) where as in Germany they would be ~34% (on $100k = ~€92k, including health insurance).

So I guess whatever's better in that example depends on if you think German health insurance is worth 5% of your income. Your $500/m amount to 6% of income so similar to Germany either way.

Keep in mind this is for single & childless, and Germany has outrageously generous tax breaks for having children as well as being married when one spouse earns a lot less than the other.

After taxes, health care and Solidaritätszuschlag, your taxrate for 100k ist closer to 42% in Germany

Not sure what you put in to get that number (keep in mind that $100k is roughly €92k) but there are many possible variables that can change your tax rate. In my personal case it is significantly lower than the number I posted above.

I used mostly default values in the first online calculators I found for both California & Germany in the example in my original post.

Just from personal experience: 42% is pretty much on the dot. It might be that with 92k you're still taxed in a lower class (or maybe you're married and thus getting a discount).

Yes, I chose the wrong tax class by mistake.

My personal tax rate is even lower than that as we have 2 kids & my wife and I file together (both self employed so we add up our incomes and file with all tax bracket at double the threshold). I think we ended up paying just over 15% off the top of my head but don't quote me on that (I earn less than €92k but still enough to have a very comfortable life).

I knew you pay more as a single/childless person but I didn't realize just how much more - which makes it all the more surprising that Germans have such a low rate of both marriage and reproduction.

My number for Germany comes from https://www.brutto-netto-rechner.info/gehalt/gross_net_calcu... & includes Solidaritätszuschlag & health insurance.

But it depends on state and stuff like church taxes (optional, you can declare being atheist & pay none) plus other things like marital status, tax classes, which public health insurance you choose, etc.

And the end of the day you pay similar taxes on income in Germany as you do in a high-tax US states like California.

I get different numbers from here: http://www.parmentier.de/steuer/steuer.htm?wagetax.htm

On 92,000 Euro I get 45% total. In California it’s 30%. Moreover, if you’re making $100,000, you’re almost certainly getting health insurance as part of the salary in California, so you don’t need to add the cost of health insurance on top of that.

Ah, I think I see the difference - for singles (class I) it gives you 43%, I mistakenly chose the married category (class III, in my mind that was the "default" tax class - probably cause that's how I have always filed in Germany), in which case the rate is 33%.

And what if you make the US median individual income of $31k?

About 15.75% according to https://neuvoo.com/tax-calculator/?iam=&uet_calculate=calcul...

If you make 31k, you likely don't have the good health insurance of the OP, and your final bill would be hundreds of thousands (i.e. it couldn't be afforded)

In reality you would end up on Medicaid. There would be limits to what hospitals you could go to for treatment, but you wouldn't be stuck with the bill in the end.

Basically the way the American healthcare system works, they will eventually pick up the tab. They just go out of their way to bleed you dry on the way.

If you make $31,000 as a non-elderly single person, you’re at 250% of the FPL and there is an 89% chance you’re insured: https://www.cbpp.org/uninsured-rates-are-higher-at-lower-inc.... Under Obamacare, there really isn’t any health insurance plans that will leave you with hundreds of thousands in costs without coverage (leaving aside surprise out-of-network doctors and that’s a loophole people on both sides of the aisle are trying to fix).

We get comparable treatment as Germany in Australia and pay comparable tax to America. I don't buy that this is a luxury of high tax paying countries. Something is systemically wrong in the US.

Yes. The problem is we simply pay much more for treatment and medicine in the US because it cost more.

It’s actually an issue where I can see the landscape changing rapidly, and fully expect major changes in the next 5 or so years.

Germany's average tax rate (according to the OECD) for a one-earner married couple with two children is 34.3%, while the same in the US is 18.8%. Taking these, the difference for your $100k/year example would be about 15k. You'd have about 80k in the US, and about 65k in Berlin.

Now to compare cost of living - let's say you wanted to compare Berlin vs SF, for similarly ridiculous housing markets. A quick search[0] suggests that living in Berlin costs nearly half as much - Berlin's $65k is more like a San Francisco $130k.

Now the downside is that you're not actually going to get paid as much in Berlin - maybe $68k as a senior software developer, as opposed to $135k-ish in SF. Plugging these numbers into a couple of actual quick tax calculators rather than using the averages, the Berliner makes about $41k, while the worker in San Francisco makes about $87k - although these are both without going through an accountant to massage the numbers. After our magic divider, that's a difference of about $2.5k.

Perhaps the US allows an accountant to massage the numbers more than Germany, but honestly, as someone currently in Germany, that doesn't pass the smell test.

So all in all, you wind up with $2.5k a year over the Berliner with which to cover everything that Germany's system does. And this is one of the best case scenarios - a high-salary tech worker with good benefits. For everyone else in the US, their quality of life and access to effective healthcare is likely to be significantly lower.

[0] https://www.numbeo.com/cost-of-living/compare_cities.jsp?cou...

A high-tech worker living in SF is actually not “one of the best case scenarios.” As your calculations show, the insane cost of living blows out the somewhat higher income. In terms of actual prosperity, run the numbers for places like Iowa. Salaries are 1/2 as much in Des Moines than San Francisco, but a house costs about 1/8th as much. And 95% of people have health insurance. There is a reason people are actually flooding out of California and New York.

I wonder if the insane costs and dysfunction of coastal cities is one of the driving factors of the differences in politics between those places and the rest of the country. I live in a Trump precinct in a historically red but recently purple county about an hour from DC. Median income in my county is $90,000, and you can buy a family house in a good school district for $300,000. We might feel differently about politics if our incomes were no higher and houses cost $1.3 million and our schools were among the worst in the country. But that’s California’s self-inflicted problem.

And someone not living in Berlin can live significantly cheaper too - do you want to pick a city similar to Des Moines in Germany?

EDIT: I took your number of 1/2 as truth, went through the numbers, and... our worker in Des Moines makes about 5k a year more than the one in Berlin. It'd still take 12 years to pay off the person above's unexpected medical expenses.

Then, after running the numbers for a high-tech worker, do you want to run the numbers for your janitor?

The definition of "health insurance" in the US is weird - it doesn't actually seem to mean you're going to be able to be able to access either expected or unexpected healthcare needs at a price you can afford.

> I took your number of 1/2 as truth, went through the numbers, and... our worker in Des Moines makes about 5k a year more than the one in Berlin. It'd still take 12 years to pay off the person above's unexpected medical expenses.

That's probably quite accurate. But most people don't have a $60,000 unexpected health expenditure before they're eligible for Medicare at 65. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5865642/

> We calculated this estimate as follows: the graph shows that, on average, a hospitalization increases the annual probability of going bankrupt in the following 4 years by 0.004. Multiplying this figure by the annual hospitalization rate of 7.8% for our population (which we calculated using the 1999–2010 Medical Expenditure Panel Survey) reveals that 0.031% (0.004 × 7.8%) of the population goes bankrupt each year as the result of a hospitalization.

If you extrapolate this out over the 40-year period covered in the study (it covers people ages 25-65) there is just a 1.2% chance that you'll go bankrupt as a result of medical debt in your working lifetime. In a country of 205 million working-age adults, that amounts to 2-3 million people. That's why you see so many news stories about it. But the odds of it actually happening to you are fairly low. Meanwhile, the higher taxes from universal healthcare are something that affect 100% of people.

If you ask people "would you rather make $5,000 more per year, or have a 1.2% chance that sometime in your working life, you'll have to declare bankruptcy due to exorbitant medical bills?" You can't say it's an irrational choice if people choose to have more money in their pocket now.

> The definition of "health insurance" in the US is weird - it doesn't actually seem to mean you're going to be able to be able to access either expected or unexpected healthcare needs at a price you can afford.

And what are you basing this on? I've got a wife and two kids. We've need to rely on our health insurance for everything from a car accident that almost resulted in a pre-term birth, to child births. The system is chaotic and confusing, but as long as you're on top of the paperwork the coverage is usually very good. According to Gallup polling, people have negative views of the healthcare system as a whole, but most rate their own coverage as good or excellent (69%) and their own healthcare service quality as good or excellent (80%): https://news.gallup.com/poll/245195/americans-rate-healthcar....

I'm sure that as you say it works out for most people on a purely rational game-theory economic sense but I would definitely chose 100% coverage over an extra $5k/year.

The whole system (not just health care) seems so stressful and antagonistic in the US.

If I had an extra $5k/year I'd probably just spend it on meaningless consumption like a bigger TV or a better car, where as not having to give a second thought about costs for medical care or higher education for my kids gives me so much more peace of mind.

Also keep in mind that not everybody has their proverbial shit together. You have to be resilient and make a lot of right life choices or you can fall into a pretty deep hole. The "paternalistic" approach of welfare states like in central & northern Europe means that as long as you basically "follow the rules" (like not breaking the law & having/keeping just about any job/career, even working-class ones) you're going to have a decent life, at least materially.

> If I had an extra $5k/year I'd probably just spend it on meaningless consumption like a bigger TV or a better car, where as not having to give a second thought about costs for medical care or higher education for my kids gives me so much more peace of mind.

We do. The median house in the US is twice as big as in Germany or France. We have 50% more cars per person than Germany and almost twice as many as France. Even excluding healthcare (to exclude the effect of inflated healthcare costs in the US), per person household consumption spending is 50% higher in the US than France, based on OECD data.

I'm not sure if this means you agree with me or disagree?

America is a staggeringly wealthy country and yet you spend all that wealth on trinkets while saying you can't afford universal healthcare, free education, fewer working hours, more vacation days, paid parental leave & other social benefits almost every other developed country provides their citizens.

> And what are you basing this on?

Talking to working-class friends in the US about their access to healthcare. They feel concerned about the price of going to their doctor about things that our doctors urge us to talk to them about. Routine, expected medical treatment often takes years of saving up, and I've had friends die before they managed to get that treatment. When people wind up with an illness requiring ongoing treatment, any additional money they might make quickly goes down the drain.

They also feel scared about losing their job, and therefore their access to healthcare, if they ever become ill enough to have to call off sick, thus compounding the problem.

Yes, it's rational when you're well-off to want to keep your money. But I'd very much prefer to make sure the people around me have real access to healthcare than that I can maybe buy a slightly nicer house.

Like the Hunger Games. For most people it works great, as long as your name isn't drawn.