PNHP

The U.S. Healthcare System in Conversation with Dr. Don McCanne

It leads the world in innovation and spending, yet leaves millions uninsured or in debt. We trace the history of how the US healthcare system became a profit-chasing industry, and speak with Dr. Don McCanne, a longtime physician and advocate, about what a more just and accessible future could look like.

By Chloe Crawford
Spero ~ Hope for the Future, May 13, 2025

The US healthcare system lives in two realities.

It is a system home to innovative treatments, leading research, and world-class hospitals, with the highest spending on health per person when compared to similar wealthy nations.1

However, simultaneously, it is a system where millions of Americans face barriers to healthcare. They must navigate complicated insurance rules, and a reality where an unexpected illness or accessing care without insurance can result in bankruptcy and crippling debt.

This leaves many to ask, “Why is access to healthcare in the United States so complicated and so expensive?”

To help answer this question, we spoke with Dr. Don McCanne, a retired physician, longtime health policy advocate, and Senior Health Policy Fellow with Physicians for a National Health Program (PNHP). Dr. McCanne has spent decades treating patients and fighting for reform. We explore how the U.S. got here – and with the help of Dr McCanne –  how it might set out a different path forward.

History of Healthcare in the US

While many similarly wealthy countries began to implement national health insurance plans throughout the 20th century, the US did not.

A brief timeline:

Early 20th Century – Independent physicians and low costs: In the early 1900s, most doctors in the United States worked independently, healthcare costs were relatively modest, and hospitals were often community-run or charitable institutions. There was a lack of country-wide healthcare initiatives or legislation. Most healthcare matters were left to states, who in turn left them to private and voluntary programs.

World War II – Birth of employer-based insurance: During World War II, wage controls prevented employers from raising salaries, so many began offering health insurance as a benefit to attract workers.3 This marked the beginning of America’s widely employer-based model of healthcare, where affordable access to healthcare became tied to one’s employment.

Post-War Era – Rise of for-profit insurance: Private health insurance was initially offered by nonprofit organisations like Blue Cross, which charged flat rates for hospital coverage.4 But after the war, they faced growing competition from for-profit insurers, who introduced risk-based pricing and charged more to groups with a history of higher health costs.5 For example, older or disabled workers faced higher rates. This laid the groundwork for systemic differences in access and affordability of healthcare.

Cold War Impact – National Health Insurance attempts blocked: While several presidents, including Truman and Kennedy, proposed national health insurance, these efforts met fierce resistance.6 Opponents, especially the American Medical Association and private insurers, framed such proposals as “a communist plot,” invoking Cold War fears of communism.7 As other wealthy nations built universal health systems after World War II, the U.S. doubled down on private-sector solutions.

1950s-60s – Tax policy and expansion of private plans: Private insurance continued to expand, partly because employer contributions to health coverage were not included in a worker’s taxable income.8 This tax advantage made it cheaper for employers to offer health benefits, cementing the dominance of private, job-based coverage. Meanwhile, those without employer coverage – especially retirees, the poor, and the unemployed – were often left behind.

1965 – A turning point! The creation of Medicare and Medicaid: President Lyndon B. Johnson signed the first nationwide public health insurance programs into law in 1965.9 Medicare provides federal health coverage for those over 65 and some with disabilities. Medicaid, a joint federal and state program, covers low-income individuals and families, but eligibility varies by state.

1980s-90s – Managed Care and Market Logic: Healthcare costs surged in the 1980s due to the introduction of new and expensive medical technologies, the use of a fee-for-service payment model (doctors and hospitals are paid for each test, procedure, or visit) which incentivised overuse, and minimal price regulation.10 In response, insurers introduced managed care models which restricted users to agreed-upon care providers and often required pre-approval to access certain services.11 While managed care briefly slowed cost growth, it also limited patient choice and created frustration and confusion among both patients and providers.

2010 – The Affordable Care Act: Introduced by President Obama and often referred to as Obamacare, it was aimed at reducing the number of uninsured Americans.12 It expanded Medicaid in many states and created online marketplaces where people could compare insurance plans. However, it preserved the central role of private insurers.

US healthcare is now a patchwork of private insurance plans and employer-sponsored coverage. While programmes like Medicare and Medicaid have helped millions, the system remains fragmented and dependent on private insurers. Dr McCanne and many like him believe these programmes need to go further. His career saw the impact of Medicare’s introduction on his elderly and retired patients, many of whom were living only on a social security check and were “suddenly able to have essentially unlimited healthcare.”

This is an approach he believes could work for everyone. However, over time, healthcare in the US has solidified itself as a for-profit industry, rather than a basic necessity for the benefit of everyone.

The Current US Healthcare System

Today, about half of Americans get insurance through work. Around 9% have no insurance at all, and many more are underinsured.13 The current system is costly, complex to navigate, and corporatised.

Insurance doesn’t always mean affordable – Most plans include:

  • Deductibles: What you pay before insurance kicks in
  • Copays: Fixed fees for services (like $40 to see a doctor)
  • Coinsurance: A percentage of costs you must cover (e.g. 20% of a hospital bill)

This means that many people who are technically insured still incur very high upfront or out-of-pocket costs.14

Insurance networks are restrictive – Most insurance plans use provider networks, approved doctors, and hospitals that have contracts with your insurer. If you go out-of-network, you’ll pay much more (or sometimes everything!) yourself.

Drugs and treatment are expensive! – Drug prices in the U.S. are much higher than in other countries.15 For example, insulin can cost almost 5x more in the US compared to just over the border in Canada.16 A key factor in this difference is that the US doesn’t regulate drug prices when products are launched or when substantial price increases are enacted after launch.17

Covid-19 exposed the underlying issues in the system – The pandemic laid bare some of the key systemic failures of US healthcare. Millions lost their jobs and, as a result, their health insurance. Hospitals were overwhelmed. Essential workers risked their lives with minimal reward.18 The crisis amplified calls for a more resilient, equitable system, not tied to employment nor distorted by profit.

Corporate Consolidation Has Taken Over Care – Healthcare is no longer local or community-based. Now, it’s big business. Through a process known as vertical integration, insurers, hospitals, and clinics have merged into giant corporate systems. For-profit companies now own the vast majority of healthcare facilities and practices, including hospices, nursing homes, and ambulance companies. For example, UnitedHealth, one of the largest insurers in the US, uses its offshoot company Optum to control more than 1500 clinics with 60,000 doctors. McCanne and his colleagues point to this example as evidence that “Increasingly, Americans’ insurer is also their doctor.”19

This corporate consolidation means less competition, fewer independent doctors, and decisions driven by profit for shareholders, no matter the cost to patients.

The result? Medical debt is one of the number 1 causes of bankruptcy in the U.S.20

Even insured patients can end up owing thousands for hospital stays, Emergency Room visits, or medications. Surprise bills, out-of-network charges, and denied claims leave many financially devastated.

Studies show:

  • 41% of US residents carry medical debt.21
  • 60% of uninsured adults delay care due to cost.22
  • Crowdfunding sites like GoFundMe host over 250,000 medical fundraisers every year.23

Another Path Forward

For decades, advocates like Dr. McCanne and organisations like Physicians for a National Health Program (PNHP) have championed Medicare for All – a single-payer national health insurance system that:24

  • Covers every American
  • Is funded publicly through taxes
  • Eliminates private insurance companies
  • Reduces wasteful bureaucracy
  • Gives doctors and patients freedom from insurance and profit-driven decisions

This doesn’t have to come at great cost to the American people. Dr McCane points to the many studies that show that comprehensive care can be provided to everyone at no greater cost than is currently being spent.25

But McCanne and others now recognise that even this bold reform must go further. They want you to ask not just how care is paid for care but who owns and provides it.

As corporate control over care delivery grows, reformers argue that the US needs a National Health Service model – publicly funded and publicly owned. In this model:26

  • Hospitals, clinics, and other vital facilities would be owned by the people, not shareholders.
  • Local communities, not corporate head offices, would control how care is delivered.
  • Federal oversight would ensure quality and equity.
  • The focus would shift from financial return to human well-being.

This approach would put public health back in the hands of the people, where it belongs.

Dr Don McCanne on how to fight for better

Dr. McCanne’s story is one of lifelong commitment. Inspired by his father, a teacher who became a physician later in life, he and his twin brother entered medicine not to get rich, but to serve. They set up and ran a community practice in San Juan Capistrano where they accepted all patients, no matter their citizenship or financial status.27

Now in his late 80s, despite health issues and retirement, he continues to write and advocate for change. He co-authored the long-running “Quote of the Day” column on health policy, now continued as Health Justice Monitor by his colleague, Dr. Jim Kahn. Even in today’s turbulent political climate, he still believes progress is possible:

“The injustice of our healthcare system is becoming harder to ignore. People are waking up.”

When asked what gives him hope, he points to the next generation. “At 87, I know that I won’t see it, but I still have hope for the future.”

Dr McCanne shows us the impact of showing up, dedicating time to your community and not losing hope. He still believes that the US has every potential to live up to its proclamations of being a great country for all those who live in it. Healthcare reform in the United States is not a pipe dream. It is within reach.

Dr McCanne serves as a reminder that change doesn’t start in government; it starts with people who care. Patients, doctors, nurses, and voters must stand together and demand a system that works for everyone. This sentiment rings even more true next to a backdrop of recent cuts to healthcare programmes and research.28

When reflecting on his lifelong fight for more equitable and accessible healthcare in the US Dr McCanne leaves us with this: “I realise that there is so much more work left to do, and it’s going to have to be done by you. I just hope that some of us can provide a modicum of inspiration to help move the process forward. We are so close.”

What You Can Do

Learn more about the solutions being proposed to US healthcare at: PNHP.org, Health Justice Monitor, DoctorsForAmerica.org

If you live in the US, talk to your representatives, share your own experiences and struggles with the system and vote at elections with healthcare in mind!

For those outside the US, take inspiration from Dr McCanne on how to persevere in pursuing a more just world for yourself and others.

Stay tuned at Spero to learn about other healthcare systems around the world!

https://spero-hopeforthefuture.com…

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