The Quirkiest Quirks of Our Healthcare System
If I had to pick one word to describe our healthcare system, it would probably be quirky.
I often find myself wondering why things are the way they are. Like why are our teeth and eyes not part of your medical care? Why does the person next to you at the pharmacy pay a completely different price for the same. exact. medication?
Sometimes, there's an interesting answer, but that doesn't make it less frustrating. Behind each quirk, there's usually an obscure law or historical event that explains why we're stuck with it today.
None of these things would make sense if we were building a healthcare system from scratch today. But we're living with choices made during World War II, laws from the 1790s, and industry deals from the 1980s and 90s.
So without further adieu, here is my list of of the quirkiest quirks of American healthcare:
1.Teeth and eyes live in their own world
Despite your eyes and teeth definitely being part of your body and core to your overall health and well-being, you wouldn’t know it from how disconnected dental and vision care is from the rest of healthcare.
Dental care has historically been professionally separate from medical care—which is why your dentist graduated from dental school, not medical school. It continues to be this way because dental and vision care tends to be more limited and routine, which doesn’t square with the nature of risk health insurers assess.
However, having separate plans and payers for these services often means many patients (about ~23% of adults) opt out of supplemental vision and dental coverage, which then means they have more expenses down the line or just don’t get these aspects of their health checked.
As soon as I realized that dental insurance is just a pre-paid discount card, I dropped it. Luckily, my dentist offers a “membership” similar to the Direct Primary Care model, where I pay a flat fee for cleanings and annual x-rays and get a discount on any more costly procedures. Still, I’m annoyed dentistry is off on its own little island.
2. Your job controls your healthcare
Unlike most of our peer nations, the majority of Americans get their health insurance through work. This employer-based healthcare scheme started during World War II when employers used health benefits to attract workers because wage increases were banned by the government. And it stuck. For the last 80-some years.
The downside? There are many.
Bad for small businesses: It puts small businesses— which make up 99% of employers and 66% of new private-sector jobs— at a disadvantage. Since they don’t benefit from a larger pool of insured employees, it leads to higher administrative costs. The escalating cost of healthcare can be a significant burden for small employers, potentially impacting their competitiveness. (Don’t get me started on how hard it is to offer health insurance to employees of a startup with employees distributed across the country!)
Traps employees: This phenomenon, known as "job lock," keeps people stuck in their jobs just to maintain health benefits. It reduces mobility across the labor market and creates economic inefficiency by preventing people from pursuing other opportunities.
Drives overspending: These tax incentives can lead to over-insurance and the use of excessively generous plans by some. This contributes to increased spending on low-value care and higher overall healthcare costs.
Burdens the poor: Most concerningly, allowing healthcare insurance premiums to be excluded from income results in tax expenditures (subsidies) that are inequitably concentrated in higher-income individuals. In fact, research shows that lower-income families with employer coverage spend a greater share of their income on health costs than those with higher incomes. Families making under $52K annually pay 7.7% of their income on employer-based health insurance premiums versus just 2.3% for high earners.
Given the amount of time someone spends in one job is far shorter today than for previous generations, this one is making less and less sense for employees and employers. I do believe this one will change in our lifetimes.
3. State borders artificially trap care
In an era of unprecedented mobility and digital connectivity, healthcare remains stubbornly bound by state lines—meaning providers can only practice in states where they're licensed. This system, dating back to the ratification of the US Constitution in 1790, made sense when medicine was purely local and people had to get around by horse. Today, it doesn’t really make sense.
Are patients living in this country different when they cross state lines? Does the human anatomy or physiology change when crossing the Mississippi River from Missouri to Illinois or driving across the George Washington Bridge from New York to New Jersey, for example? Does a physician really need 4 medical licenses from Arizona, Colorado, New Mexico, and Utah to treat patients separated by the lines of the Four Corners Monument? Or is lupus (a disease I treat) different if a patient wakes up in an Eastern or a Western time zone? - Dr. Amr H Sawalha in The American Journal of Medicine
The federal government regulates medical products and devices, so why is the practice of medicine regulated locally? Some argue that it’s easier for states to regulate the practice of medicine. Fine. States can keep regulating the practice of medicine, but they should expand practice borders. If I can see an ER doctor in another state on a work trip, why can’t I see a specialist who is the world’s expert on my condition virtually? Or, put the other way, if a doctor can see a patient from another state in person, why can’t a doctor see that same patient on a computer screen?
State lines don’t need to become brick walls.
Yet state-based licensure persists, partly due to the significant revenue states derive from licensure fees and the market protection it offers in-state physicians.
4. What you pay for a medication differs wildly from everyone else
There is no other product—not even cars—where prices vary so widely between customers. This quirk has its roots in the economics of the pharmaceutical industry, dating back to the late 20th century. Due to patent protections, high R&D costs, and low production costs, drug manufacturers gained the ability to charge different prices to different purchasers for the same product. They offer discounts based on volume and a purchaser's ability to influence market share, leading to a wide spectrum of prices.
For example, hospitals and health maintenance organizations often pay less than retail pharmacies for the same drugs. The emergence of Pharmacy Benefit Managers (PBMs) in the past 15 years has further complicated things, as they negotiate rebates from manufacturers in exchange for favorable placement on formularies. The result? A system where two patients standing side-by-side at the pharmacy counter could pay wildly different prices for the exact same medication. And unfortunately, those without insurance often pay the highest prices.
Understanding why these quirks exist helps explain why they're so hard to fix. Each one has built up its own set of interests, institutions, and income streams over the decades. But as healthcare (and society at large) keeps changing, these old rules make less sense every year.
Will we still be scratching our heads about these same quirks in twenty years? Probably. But the pandemic showed us that some "impossible" changes (like widespread telehealth adoption) can happen pretty quickly when they need to. For now, though, at least you know why a few pieces of American healthcare work the way they do - even if it still doesn't make much sense.