Hummer Healthcare: How America’s Oversized System Is Bankrupting the Nation

Next year, commercial healthcare costs in the United States are projected to rise by about 9% — the largest single-year jump in nearly two decades, according to PwC — potentially pushing total national health spending to roughly $6.3 trillion or more. The scale of these costs is draining public resources and imperiling household finances. While physicians, hospitals, insurers, pharmaceutical manufacturers, pharmacy benefit managers (PBMs), and private equity investors all loudly decry rising prices, responsibility for the problem is shared across the system.

The debate over how to fix American health care took me back to a 2008 Oxford-style discussion about whether universal health coverage should be the federal government’s responsibility. My side — which included Paul Krugman (then a Princeton professor and New York Times columnist), Michael Rachlis (a physician and health-policy analyst), and myself — argued in favor. Our opponents included Michael Cannon (Cato Institute), Sally Pipes (Pacific Research Institute), and John Stossel (then an ABC News commentator).

Stossel opened with an image of the East German Trabant — a smoky, cramped vehicle he used to warn against government-run systems. That comparison overlooked a key point: West Germany, with very different institutions and resources, and today’s unified Germany both provide universal coverage. Most wealthy nations do; the United States stands apart.

Some years earlier, I had asked which vehicle best symbolizes American health care. In 2008 the answer felt obvious: the Hummer. Once an emblem of rugged excess, the Hummer — and later the H2 — symbolized power and status while attracting criticism for terrible fuel economy, awkward handling, poor braking, and limited visibility. General Motors stopped Hummer production in 2010; the brand returned in 2021 as an ultra-powerful, all-electric vehicle with a six-figure price tag.

Like the Hummer, U.S. health care is oversized, costly, and inefficient. The United States spends roughly 2.5 times the median per-capita amount among the 38 OECD countries, and the federal government spends a larger share of GDP on health than many nations with predominantly government-funded systems (including the U.K., Canada, Sweden, and Norway). Yet about 27 million Americans — roughly 8% of the population — remain uninsured, and tens of millions more have plans with high copayments and steep deductibles. If proposed Medicaid cuts tied to legislation named the "One Big Beautiful Bill Act" take effect, the uninsured rate could rise further.

High health costs also harm the broader economy: they enlarge federal deficits, crowd out state spending on education and other priorities, reduce the competitiveness of American businesses, and erode middle-class incomes. Surveys show that more than half of working-age Americans struggle with medical bills or health care costs.

"Every system is perfectly designed to get the results it gets." — W. Edwards Deming

That insight explains much of what we see in American health care. The U.S. developed a largely voluntary, employer-centered private insurance model during World War II. Medicare and Medicaid were established in 1965, and the Affordable Care Act became law in 2010. But the size, complexity, and political influence of America’s healthcare industry — combined with a profit-first orientation — make systemic change difficult.

For all the spending, the U.S. underperforms on many key health outcomes. U.S. life expectancy, while recently at an all-time high, trails countries such as Switzerland, Japan, and Spain by several years and sits below the OECD average. Analysts including the Commonwealth Fund point to fragmented coverage, weak primary care infrastructure, high out-of-pocket costs, and the absence of universal coverage as major contributors.

Policymakers have limited options: they can keep patching and refinancing a system that is too large and inefficient, or they can pursue transformative reforms that prioritize universal access, stronger primary care, and cost containment. In short, U.S. health care looks a lot like a "Hummer" — big, expensive, and often ineffective — and it is contributing to the country’s financial strain. Rather than another round of temporary repairs, it may be time for a genuine trade-in to a more sustainable, equitable model.

Originally published on Forbes.com.