All Americans can appreciate what members of the United Auto Workers (UAW) union were after during their most recent, weeks-long strike—the lengthiest since the 67-day stoppage in 1970—increased wages, better benefits and job security.

So what kept the two organizations from finding common ground for so long? Almost all of it boiled down health care costs.

Yes, GM did give UAW what it wanted in that regard: no change to the three percent share of health care costs hourly workers already pay. But in so doing, GM had to restructure other parts of the budget, a decision—closing three plants—that still has serious consequences.

Related: Time for a health revolution

We're seeing this trend play out all across the country, where employers are struggling to offer the same quality health care coverage due to ever-increasing premiums. The 2019 average annual family health care premium on employer-sponsored plans increased another 5 percent from last year, bringing the total to a jaw-dropping $20,576, according to Kaiser Family Foundation's 2019 Employer Health Benefits Survey.

In light of this expense, employers feel forced to make their workers bear more of the health care-cost burden via high deductibles, co-pays or increased out-of-pocket spending. They believe their only alternative is to slash other parts of the budget, parts typically set aside to increase wages, preserve jobs or offer additional benefits.

No matter which path employers choose, no one fully wins in this situation—that's exactly what we're seeing with this GM-UAW deal, and that's exactly why this strike is about so much more than a disagreement between an automaker and its workers. It's about the cost structure of our catastrophic health care system, in which we pay far more than the rest of the developed world despite having the worst health outcomes of developed economies. Essentially, we're paying Cadillac prices for a Pinto health care system.

Once we understand that, we can finally start putting solutions into action—solutions that already exist, and solutions we already know work.

Health care isn't increasingly expensive; in fact, the cash prices for some health care services/procedures have stayed flat year after year, and doctors' pay only accounts for 8 percent of our country's total health care spending, essentially 8 cents of every dollar. What is increasingly expensive is the price gouging by hospitals and the drug supply chain.

Instead of cutting other parts of the budget to make up for increasing health care costs, it's time employers like GM apply its supply chain skills to health care, just as other forward-thinking employers have done. Take Midwest-based manufacturer, Caterpillar, for example. Caterpillar has focused, over the last twelve years, on drug costs in their health benefits supply chain, which has consequently resulted in overall health care costs staying level for over a decade.

In parallel, manufacturers ranging from those in the oil and gas industry in Oklahoma to those manufacturing steel in Montana are demonstrating how straightforward it is to remove price gouging by hospitals. The latter, who has employees in 9 state and 44 locations, recently did this, cutting out value-extracting PPO networks where employers are paying for the "privilege" of wildly overpaying for hospital services.

In two years, they put in place over 4,000 direct contracts with health care providers, contracts that are the polar opposite of secretive PPO agreements with escalator clauses and other games designed to guarantee price increases. By comparison, signing these direct contracts is a win-win for both Pacific Steel and those 4,000 health care providers. They receive a fair, prompt payment and don't have to chase after patients for balance bills.

The results for Pacific Steel have been great. health care spending dropped by over half while benefits improved for the employees (e.g., co-pays and deductibles are removed when they choose high-value health care providers). In addition, perhaps the best part of all this is that it has enabled working class employees to build a great nest egg, as the company is committed to return its savings to the employees.

What allowed Pacific Steel to experience these savings was eliminating wasteful spending and fully subscribing to this unfortunate health care reality: unlike any other industry, what you pay isn't what you get. They found affordable hospitals and clinics who are incentivized to spend ample time with patients, getting the diagnosis, contributing lifestyle factors and recommended treatment options right the first time. For lower back pain, such physicians aren't afraid to recommend physical therapy or a chiropractor over an opioid prescription—especially relevant for manual labor workers and employers—and stand in stark contrast to the health systems still operating under the status quo, fee-for-service payment model, where profit is determined by how many services they can perform or how many tests they can order.

Until our country can fix this fundamental issue, strikes like what we just witnessed between GM and the UAW will continue, if not crop up in other sectors as well. Rather than let that happen, now is the time for Americans to face up to the real problem: working and rallying together to create a health care system that works for us, not against us.

Dave Chase is co-founder of Health Rosetta, which aims to accelerate the adoption of simple, practical, non-partisan fixes to our health care system. He is also the author of "The CEO's Guide to Restoring the American Dream: How to Deliver World Class Health Care to Your Employees at Half the Cost."

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The GM-UAW strike can teach us a thing or two about health care

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