Study Highlights Links Between Health Costs, Unemployment, and Morbidity

Non-Profit Quarterly shares research conducted by Professor Zarek Brot-Goldberg, which reveals that as Americans spend more on healthcare, unemployment rises, government tax revenue lessens, and further health risks lead to thousands more deaths. Brot-Goldberg points to rising insurance premiums as one cause, saying: 

[Insurance costs are] the outcome of negotiations between the hospital and insurer. Generally, people are covered by some sort of health insurance, usually by a private insurer. The hospital and the insurer have agreed upon a price the insurer will pay the hospital in the case that a person goes there. Now the insurer, of course, wants a lower price and the hospital wants a higher price. The thing that allows the hospital to charge a high price is the fact that people have a strong preference for [care in] hospitals.

Because hospitals have so muhc bargaining power, they are able to negotiate up prices, passing costs off to the public and producing major consequences for many Americans.

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