Can someone explain in simple but very concrete terms why medical services cost so much in the US?

By cost, I am referring here to the medical fees being charged prior to any adjustments or reimbursements by the insurance.

I understand it takes many years of hard work to become a doctor and they deserve to be remunerated for that hard work. I really do.

I do get that medical students come out of school with massive debts as well.

I do understand there are significant costs in operating medical facilities, purchasing high-end medical equipment, running a medical staff, and being insured against law suits perhaps.

With a stretch of my imagination, I may see how all this adds up so that a visit to the doctor is charged for $100-$200 even though the actual interaction with the doctor + nurse is usually on the order of 10 minutes per patient. 10 minutes for a few hundred $ = one hour for a couple of thousands $ to cover the salary of the medical staff, the rent, and amortizing the cost of medical equipment. That seems very high to my intuition but I can at least make some sense of it.

But then on top of the visit cost, there are often "extra" costs that seem completely disproportionate with what is being done.

From random personal experience:
- a hospital charging ~$20 for one pill of ibuprofen
- a dermatologist charging an extra ~$150 for ~10 second procedures such as spraying nitrogen on a foot wart
- a few hundred bucks for spending less than a minute taking a skin sample for a biopsy (charge for the biopsy itself separate)
- a visit to the ER for a very minor injury resulting in one stitch point on a finger and a medical bill >$1,500

What is the reasoning behind these charges?

Could someone perhaps break down in simple concrete numbers the operating expenses of, say, a medical office, and a hospital and help me understand how this explains why an ibuprofen pill costs $20 in a hospital or why spraying nitrogen for 5 seconds costs ~$150 extra?

  • 1
    How much does a glass of wine cost in a restaurant? Feb 21 '18 at 16:42
  • 1
    @GrahamChiu I don't see the duplicate - although high bills could affect blood pressure ;) Seriously, I guess your comment was for an other question?
    – Arsak
    Feb 21 '18 at 19:32
  • 2
    I'm voting to close this question as off-topic because it is about costs surrounding healthcare, not health itself.
    – DoctorWhom
    Feb 22 '18 at 1:53
  • 1
    I think it is a great question that deserves to be a topic of discussion, but SE is compartmentalized and this isn't the best place for it.
    – DoctorWhom
    Feb 22 '18 at 1:57
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    Healthcare costs are negligible in developed socialist counties. In capitalist economies like the USA the cost is prohibitive. In an ultra capitalist economy like China it's bankrupting. It's politics. Feb 22 '18 at 17:39

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