I did my undergrad thesis on the U.S. healthcare system/crisis. (Yes, I really needed a thesis to graduate with a Bachelor's.)
This was in 2007, but much of that info still applies.
Here's the thing about the rising cost of healthcare: it's a worldwide phenomenon. There is no country with a modern healthcare system that has not experienced a galloping increase in the cost of healthcare. Bottom line is that healthcare was cheaper when people died easier. If we want chemotherapy, wonder drugs, transplants, then we- which is to say, ALL of us, whether we do/will use those things or not- have to pay for the research and development, education and training, and experiments and trials to make this stuff possible. There is NO WAY this level of science can be undertaken and applied via private means. To begin with, no industry is that big or widespread, no one corporation or even an entire industry could cobble together the amazing array of labs and sciences that it takes to make a single, small breakthrough.
And, yes, the big pharma companies get BILLIONS from Uncle Sam directly, and even more by piggybacking off the work of the NIH and universities.
One of the few ways to slow down the cost of healthcare as it eats up an ever greater portion of our GDP is to exploit the economics of monopsony. (Wikipedia has a good entry on this.) Monopsony is like monopoly turned inside out. When a company has a monopoly on something, you have to pay what they charge or go without. Monopsony is when there is a single buyer rather than a single seller. So if you make railroad ties, and there is only one railroad (thus, only one purchaser of railroad ties) in your state, you can only sell them for what they will pay you. If they say, "We'll pay $5 per tie," you have to figure out how to make a profit at that price or get out of the railroad tie game.
This is the principle behind, for example, Canadian style single payer. It isn't socialized health care, like the NHS in the UK, where doctors are educated and employed by the government. Single payer just turns Canada's federal government into the only buyer of healthcare in the country, and as a monoposonistic buyer, allows the Canadian government to set prices.
What people are afraid of in the US is that, if we go to single payer, quality of care will suffer. (Also that they will have to wait longer, but that is something of red herring issue, because waits are going to increase no matter what, just like costs are going to rise.) I doubt that quality of care will decrease, because doctors might make somewhat less, but they will still have very handsome salaries, because virtually everyone who works 100 hours per week and has had 25 years of school makes a handsome salary, and because their expertise is valuable, even to a monopsonistic buyer. Also, virtually all people who get into medicine are deeply intrinsically motivated, more so than almost any other profession. The people who get into medicine to make tons of money end up becoming cosmetic surgeons.
Going to single payer would slow the rate of cost increase in two other ways, as well.
Right now, Medicare has a 3% rate of overhead. Non-profit private insurance has a rate of about 10%. For profit insurance has a rate of 25%. They spend that much more to shuffle paper around because they are denying people's claims. It's called post-claim underwriting, and it takes a lot of manpower. Just by going to single payer, we'd reduce costs by 7%-22% out of the gate.
The other way is just embracing the concept of insurance. Part of the reason that some states have made it mandatory to have car insurance is partially because, the greater the burden is shared, the less it costs for everyone. That is the concept of insurance. Not everyone drives, but virtually everyone will get or will need healthcare at some point in their lives. So it makes sense that everyone should share the burden. That, more or less, is how Social Security works- it's a social insurance policy against poverty in old age. (Yes, I think Social Security needs reform, but its looming fiscal problem has a lot to do with folks living longer and therefore drawing more in lifetime benefits.)
I am not trying to force the idea of single payer down everyone's throats, though in my examination of various healthcare systems I came to realize that it is the best one. I just think that a lot of folks are confused about what single payer and socialized medicine actually are, and confused about whether they are the same thing (they aren't). I hope I helped to promote some understanding.
I see this is your first post 2BFree, so welcome to the forum. Take a minute and introduce yourself over at the 'where are you, where am I' thread, k?
