Why American Healthcare Is in Crisis — and the One Reform That Can Fix It

America’s healthcare crisis is not caused by one bad policy or one failing program. The system is breaking because it is built on incentives that undermine affordability, coordination, and quality. When you look across the major failures — rising costs, fragmented care, clinician burnout, unnecessary utilization, fraud, and overwhelming administrative burden — a single pattern emerges: these are symptoms of a fundamental design flaw.

Affordability Is the Breaking Point

ACA premiums keep rising. Medicare Part B premiums will jump 9.7% in 2026. Working families now pay about $20,000 a year for employer coverage. Regardless of age or income, Americans face the same conclusion: healthcare has become unaffordable.

Care Is Fragmented Because No One Is Paid to Coordinate It

Chronic illness is increasing, and medical specialization has exploded. Patients juggle multiple specialists and medications, yet the payment system pays no one to coordinate care. Fragmentation is now one of the most expensive and dangerous failures in American healthcare.

Administrative Burden Is Crippling Clinicians

Physicians spend 45% of their time on documentation, coding, and prior authorization. The U.S. spends $1 trillion a year just billing for healthcare—nearly 30% of all spending. This burden drives burnout and reduces the capacity of an already strained workforce.

Over-utilization and Fraud Are Incentive Problems

Roughly 30% of services are unnecessary, driven by the fee-for-service model that rewards volume. For forty years, policymakers have tried to replace it with Value-Based Care models that the market has not meaningfully adopted. Meanwhile, a massive fraud-policing apparatus adds cost without fixing the root problem: incentives that encourage overuse.

Three Targeted Reforms

Primary Care: Pay clinicians a fair salary plus simple outcome bonuses, reimburse practice costs, and eliminate billing and prior authorization for primary care. This would nearly double capacity and reduce fragmentation and costs.

End-of-Life Care: Use cost-based reimbursement for hospice and palliative care to encourage earlier use, eliminate coding manipulation, and improve quality.

Medicare Advantage: Stop coding-driven overpayments by setting MA rates at the average per-capita cost of traditional Medicare.

The Common Denominator

All these failures trace back to the same cause: a coding and billing system that determines what gets paid, who gets paid, and how much gets paid. Until we fix how we pay for care, every reform will continue fighting the system rather than redesigning it.

Payment reform is the gateway reform — the one change that makes all others possible.