If you've ever felt blindsided by medical bills, you're not alone. In fact, when Warren Buffett called health care "the tapeworm of American economic competitiveness," he wasn't pulling punches—he was delivering a vivid wake-up call.
At the 2017 Berkshire Hathaway Annual Shareholders Meeting, Buffett made plain what a lot of people quietly suspect: the real burden on American business isn't taxes—it's health care.
"Medical costs are the tapeworm of American economic competitiveness," Buffett declared.
He offered perspective that's simpler—and more startling—than any chart:
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"When American business talks about taxes strangling our competitiveness… they're talking about something that… has gone down from four to two [percent of GDP], while medical costs… have gone from five to 17%."
In other words, businesses spent proportionally less on taxes over time—and far more on medical costs. That growth, Buffett warned, is what's eroding U.S. competitiveness—not corporate tax rates.
Charlie Munger was quick to jump in, adding with characteristic bluntness:
"And that's with socialized medicine."
Buffett didn't shy away.
"The tax system is not crippling Berkshire's competitiveness around the world or anything of the sort. Our health costs have gone up incredibly and will go up a lot more… While we're at 17, now, [other countries] are at 10 or 11."
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It wasn't just an academic point to Buffett—he framed it as a deep-rooted problem.
"That is a problem this society is having trouble with and is going to have more trouble with… regardless of which party's in power… it almost transcends that."
He laid it out plainly: health care is dragging down our competitive edge, not taxes. And even then, he predicted, it would only get worse.
Munger expanded on the systemic dysfunction he saw:
"What I don't like about the medical care is that… we're getting too much medicine. There's too much chemotherapy on people that are all but dead… But, my God, the system is crazy. And the cost is just going wild… it does put our manufacturers at a big disadvantage."
Together, Buffett and Munger painted a clear picture: it's not inefficiencies in corporate taxes killing industry—it's runaway medical spending, inefficiency, and misaligned incentives.
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Buffett wrapped it up by pointing to the broader consequence:
"If you talk about world competitiveness of American industry, it's the biggest single variable where we keep getting more and more out of whack with the rest of the world."
If you grew up watching charts of taxes and business costs, Buffett's focus on health care may feel refreshingly real. For those considering retirement, budgeting, or just keeping a finger on economic pulse, this "tapeworm" isn't abstract—it's a cost hitting you where it hurts: your health and your pocketbook.
Buffett's warning hasn't softened—but in 2025, his strategy took a deliberate turn. Berkshire Hathaway invested $1.6 billion in UnitedHealth Group (NYSE:UNH), making its biggest bet yet on the country's largest health insurer. The move came at a turbulent moment: UnitedHealth was facing soaring care costs, government investigations, and fallout from a cyberattack. But Buffett wasn't betting on a fix—he was betting on endurance because dysfunction and all, it still delivers returns.
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