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Why is healthcare in the US so expensive?
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The salaries of American doctors tend to be quite high

On average, American doctors are paid around $300,000 a year, which is much more than any other country. Many powerful medical organizations ensure that only a handful of doctors graduate every year. Since there is low supply and high demand, these few doctors are paid very well. Overall, this drives up the cost of healthcare for all patients.

The Argument

US physicians have the highest annual salaries compared to any other country. The median annual salary is $313,000.[1] To put this in perspective, Germany has the second-highest rate of compensation at only $163,000. While some jobs in America are underpaid compared to their counterparts in other wealthy countries, doctors tend to be the exception. This can be explained by the medical cartel present in the US. A cartel is established when the supply of goods or services is strictly controlled by higher-ups.[2] In medicine, the number of doctors in every field is regulated so that the supply does not exceed the demand. In fact, due to these rigid rules, in recent times there has actually been a scarcity of doctors, especially in rural areas. Organizations such as the Accreditation Council for Graduate Medical Education set the number of medical seats and residencies that are available each year. They make sure that only a few of the most qualified students enter medical school and among them only the best gain residencies, which are legally required for becoming a doctor. By limiting how many doctors are available, they can make sure that everyone is paid handsomely. Doctors are extraordinarily compensated due to there only being a few of them. This high salary drives up healthcare costs.

Counter arguments

While doctors are paid quite well, the burden of expensive healthcare cannot just be attributed to their salaries. The amount of money they are being paid is a mere fragment of healthcare costs in general. Also, by incentivizing doctors with such wages, only the best and most dedicated students enter the field. This means that medical malpractice cases are much lower and the amount paid in insurance claims, and other medical-related costs are much lower. This drives the cost of healthcare down and not up. Also in almost every industry, the amount of education and training justifies the money workers are paid. In America, doctors study and train for 11-16 years. During this time, they have garnered a large opportunity cost fee. Their future salaries recompensate them for the missed time and help them pay back massive student loans. Economically speaking, their salaries are justified and these wages are not making healthcare as expensive as it is.



[P1] The number of doctors in the American healthcare system is strictly limited. [P2] By limiting the number of doctors getting paid, it allows those who do become doctors to have higher wages. [P3] The high wages for medical personnel cause American healthcare to be expensive.

Rejecting the premises

[Rejecting P3] Doctors are deserving of their high wages due to their intensive training and missed time in the workforce.


This page was last edited on Saturday, 29 Aug 2020 at 03:19 UTC

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