America’s Health Care System is Broken: What Went Wrong and How We Can Fix It. Part 3: Hospitals and Doctors

32% of US health care spending goes to hospital care and 20% to physician charges. The cost of hospital care in the US is 2–3 times greater than in most similar countries. A large part of the high cost is due to a very large administrative overhead. Both higher quality and lower cost would be achieved if complex procedures were done in fewer centers. Hospitals with a geographic or prestige monopoly receive higher payments than warranted. As physicians are increasingly employed by hospitals rather than independent, costs go up with no added benefit to patients.

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