It isn't just non-payments. It's how the insurance companies handle claims that has contributed to the shithole our system currently is.
So, you go in to have X done. What does X cost?
You can add up the labor, overhead, supplies, etc. and come up with a number. I'm sure hospitals do this. And I'm also sure it's actually a sane number.
The problem is that someone, at some point, realized that the cost of X DOESN'T MATTER. They realized that what does matter is what the insurance company will PAY for X. This person figured out that if the insurance company will pay $1000 for X but the hospital only asks for $100, the hospital loses out on $900. Since the insurance company isn't going to hand out a menu of their pay outs, this guy figured out that he could charge teh insurance company $10,000 for X and let the insurance company negotiate it down to the maximum they are going to pay. That way the hospital gets every penny they can from the insurance company.
So your $100 visit is now a $10,000 visit.
What I don't understand is why the insurance companies decided to squeeze their customers rather than cracking down on the hospitals. There must be some financial sleight-of-hand that makes paying these inflated bills more profitable than controlling the costs.