From what I understand, there is massive overspending on healthcare in the US,
A large part of the problem is that since private insurers don’t have that much political power, politicians can score points by passing laws requiring them to cover certain procedures, which may very well not be cost-effective.
The politicians presumably get a balancing disincentive when they have to pay for these medical procedures and hence raise taxes, increase deficit or redirect money from other projects (most likely those that have less public support, for better or worse).
A large part of the problem is that since private insurers don’t have that much political power, politicians can score points by passing laws requiring them to cover certain procedures, which may very well not be cost-effective.
The politicians presumably get a balancing disincentive when they have to pay for these medical procedures and hence raise taxes, increase deficit or redirect money from other projects (most likely those that have less public support, for better or worse).