Hospitals Are Robbing Us Blind

Forget Obamacare. The real villains in the American health care system are greedy hospitals and the politicians who protect them.

Hospitals that don’t face competition from other nearby hospitals have huge power in their local markets.

By Reihan Salam

Five years ago this week, Barack Obama signed the Affordable Care Act into law, and we’ve been debating it ever since. Like many Americans, I oppose Obamacare, and I think we ought to repeal it and replace it. Over the past few months, however, I’ve come to the conclusion that the fight over Obamacare is a distraction from a much deeper problem, which is that America’s hospitals are robbing us blind.

I realize that this is an impolitic thing to say. What kind of lousy ingrate doesn’t love hospitals? Go to any big American city, including cities like Cleveland and Pittsburgh that have been devastated by deindustrialization and joblessness, and you’ll find a mammoth hospital complex in the center of town, buzzing with activity. Forget about big cities—there is a hospital in every congressional district in America, and local hospitals are often among the largest employers in the district. One of the reasons President Clinton’s 1993 health reform effort failed is that he never won over the hospital lobby. President Obama learned from the Clinton debacle; hospitals were among his most important allies. Republicans get in on the act too. Right now, for example, a number of GOP lawmakers are pushing a Medicare “reform” that guarantees higher payments to doctors and hospitals today in exchange for the promise of spending reductions a decade or two from now. Good luck with that.

You can hardly blame them though. The health sector employs more than a tenth of all U.S. workers, most of whom are working- and middle-class people who serve as human shields for those who profit most from America’s obscenely high medical prices and an epidemic of overtreatment. If you aim for the crooks responsible for bleeding us dry, you risk hitting the nurses, technicians, and orderlies they employ. This is why politicians are so quick to bash insurers while catering to the powerful hospital systems, which dictate terms to insurers and have mastered the art of gaming Medicare and Medicaid to their advantage. Whether you’re for Obamacare or against it, you can’t afford to ignore the fact that America’s hospitals have become predatory monopolies. We have to break them before they break us.

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