More or Less – The Shocking World of US Health Costs

Podcast: More or Less (BBC Radio 4)
Host: Tim Harford
Guest: Elizabeth Rosenthal, Editor-in-Chief at KFF Health News
Date: December 20, 2025

Episode Overview

This episode dives into the eye-watering and often bewildering costs of healthcare in the United States. Prompted by a listener question about a claim that a single pill could cost 250 times more in a hospital than at a pharmacy, host Tim Harford and healthcare journalist Elizabeth Rosenthal unpack why US hospital expenses are so extraordinarily high, how the system got this way, and the real-life impact on Americans.

Key Discussion Points & Insights

1. The Viral Pill Story (01:36)

• Listener Bettany hears a claim that one pill can cost $3 at a pharmacy, but $750 in a US hospital—a markup of over 250 times.
• Tim Harford introduces the episode's purpose: to check the facts and explore hospital billing practices.

2. How Hospital Charges Became So High (03:16)

• Elizabeth Rosenthal: Hospitals began maximizing billing after bringing in business consultants in the early 2000s.
  • “The consultants basically said, why are you just giving away that Tylenol?...You could be billing that separately and billing in 15 minute intervals.” (03:21)
• Hospitals now bill for every item and minute of care, leading to extremely detailed and high itemized bills.

3. Medication Markups and the 340B Program (04:24)

• Many US hospitals are non-profit, avoiding taxes in exchange for community benefit, but often fall short of this expectation.
• The 340B Hospital Markup Program (1992) lets certain hospitals buy drugs at deep discounts (about 50% off retail) and resell at huge markup.
  • “They can buy medications at incredibly reduced rates and then mark up the prices to make a profit.” (04:35)

4. Political and Economic Power of Hospitals (05:18)

• Hospitals are among the largest political donors and employers in many states.
  • “Politicians are afraid to go after them. University of Pittsburgh Medical center is the second largest employer in the state of Pennsylvania.” (05:25)
• Even ‘non-profit’ hospitals behave aggressively to maintain income.

5. Real-Life Examples of Wild Hospital Charges (05:58)

• The show highlights real bills flagged by the KFF/NPR "Bill of the Month" project:
  • Woman charged $4,000 per screw for foot surgery.
    • “She was like, what are they made of, like moon rock or something?” (06:00)
  • $99,000 for removal of an ectopic pregnancy—billed as two surgeries.
    • “This is an outpatient procedure, by the way.” (06:20)
• Charges are often disaggregated, so nothing is included as a "package": each component is separate and expensive.

6. Insurance Complexities and Out-of-Pocket Costs (06:42)

• Americans must have insurance due to sky-high baseline costs.
• Insurance only pays for services within agreed networks; otherwise, patients may be denied coverage.
  • Elizabeth: “I'm always on the lookout, okay, I need this procedure. If it's done in a hospital, I'm going to have a huge facility fee...” (07:06)

7. The Role of “Pre-existing Conditions” and Obamacare (07:30)

• Until 2014, insurance could deny coverage due to “pre-existing conditions” (diabetes, asthma, pregnancy, mental health).
  • “Maybe you take a pill for depression so you have pre existing conditions, we're not going to cover you. And Obamacare forbid that from happening.” (07:43)

8. Rising Deductibles, Co-Insurance, and Medical Debt (08:03)

• Deductibles have skyrocketed (“at first were like $500, now they can be $7,000” (08:03)). Patients pay all costs up to this limit before insurance kicks in.
• Insurance often only covers a percentage, with patients responsible for “co-insurance”—often 10–20%.
  • “Finger injections…cost $25,000 each…coinsurance on that is $4,000. Even if you have insurance, the out-of-pocket costs can be overwhelming.” (08:27)
• 8% of Americans are fully uninsured.
• Investigation: 100 million Americans (almost 1 in 3) have medical debt; nearly 20% believe they’ll never pay it off. (09:04)

9. Policy Subsidies and Looming Risks (09:21)

• ACA subsidies (from Biden administration) have helped tens of millions afford insurance.
• These subsidies are about to expire (in January 2026), threatening to double or triple premiums for vulnerable Americans.
  • “Many people will say, I can't afford insurance and go without. And that's a really risky proposition when a trip to the emergency room in the US routinely costs $10,000, and that's with very little done.” (09:44)

10. Yes, the Shocking Pill Story is True (10:06)

• It’s entirely possible for a $3 pharmacy pill to be billed at $750 or more in hospital, with significant markups common across US healthcare.

Notable Quotes & Memorable Moments

• Elizabeth Rosenthal on itemized billing:
  “Now you look at an American hospital bill and it's pages and pages long because every IV bag, every pill, every blood draw, everything is charged separately.” (03:21)

• On hospital-purchased drugs:
  “They can buy medications at incredibly reduced rates and then mark up the prices to make a profit. The idea was that they'd then channel the money saved by back into the community.” (04:35)

• On political power:
  “They are huge political donors. Politicians are afraid to go after them.” (05:25)

• On real-life medical bills:
  “A woman needed screws put into her foot...each one was billed at $4,000. And she was like, what are they made of, like moon rock or something?” (05:58)

• On deductibles:
  “Those deductibles…which at first were like $500, now they can be $7,000. So even if you're insured, you're vulnerable for a lot of money.” (08:03)

• On the scale of medical debt:
  “100 million Americans, that's almost a third of the population, have medical debt and nearly 20% of them do not expect to be able to pay it off in their lifetime.” (09:04)

Key Timestamps

• 01:36 – Introduction: $3 pill vs $750 pill claim
• 03:09–03:21 – Elizabeth Rosenthal’s background and how itemized billing evolved
• 04:24–04:35 – 340B Hospital Markup Program explained
• 05:41 – KFF & NPR’s “Bill of the Month” shocking case studies
• 06:42 – Insurance networks and barriers to access
• 07:30 – Pre-Obamacare insurance discrimination
• 08:03 – Deductibles and coinsurance pain for insured patients
• 09:04 – Scope of national medical debt
• 09:21–09:44 – ACA subsidy risks and future premium hikes
• 10:06 – Tim’s confirmation: shocking medical bills are unfortunately real

Final Takeaway

The US healthcare system’s pricing is wild, routinely turning simple treatments into financial cataclysms. Both the causes—complex billing, profit-seeking by non-profits, political protection, and insurance patchworks—and the downstream effects—staggering debt, limited access, and consumer confusion—are made painfully clear. The claim of a $3 pharmacy pill becoming a $750 hospital charge isn’t just possible; it’s an everyday part of US healthcare’s “bonkers” reality.