I keep reading that the US spends aboug 15% of GDP on healthcare while most other developed countries spend 7-10%. is this due largely to price controls on salaries of physicians? What are the median salaries of physicians by country (developed country)?
i also came across this sheet showing the top 20 countries in regards to how many doctors per 1000 people. Germany was #1 with 3.3 per 1000.
The US isn’t in the top 20 countries in regards to most doctors per 1000 people but many european countries are. is this a major factor in why healthcare is more expensive here, because we have a doctor shortage? I assume our nursing shortage isn’t helping but i think all/most countries have one of those.
I assume price bargaining for prescription drugs is another huge factor, what else?
I forgot to add this stat in with the OP but according to the Occupational Outlook Handbook physicians held 598000 jobs in the US in 2000. in 2000 the population was 281,421,906
giving roughly 0.5 doctors per 1000 people, which is almost 1/7 as many doctors as the no 1 country and 1/4 as many as the no 15 country.
Another factor is bureaucratic overhead. The U.S. health care reimbursement system is incredibly inefficient since doctors need to deal with all sort of different claims forms and mechanisms from different insurance companies. There was a study recently that compared this overhead in the U.S. and Canada…I’ll let someone else dig it up. On an anecdotal note, a doctor I knew in Vancouver was telling me that the practice he was in had a secretary who spent part of her time on reimbursement issues. He said that in the U.S., a similar-sized practice would have to employ a few people full time to deal with this.
There are a few other factors. One that I remember off the top of my head is that countries with socialized medicine don’t count the expenses in the same way. Money spent to collect medical fees, for instance is counted as medical expenses in the US. Money spent to collect taxes is not. Also, please be careful which countries you compare our spending, and on which years. If I am not mistaken, that 7% number was from Britain during the early ninties. IT was a period when many felt the government had slashed spending with little or no regard to costs to patients. Also, you might look into how many of thos countries are complaining that their governments underfund health care. That is, how many of them are satisfied with their current spending rate. It may simply be that the US spends more on health care because we use more of it.
I don’t have the cites handy for any of this, so ignore it if you want. But I remember having a long thread about this a while ago. Do a search on healthcare and you’ll find many threads about it.
Probably one of the single largest issues is the cost of malpractice insurance for doctors, whick of course gets passed on to the patients. I dont think there is a country with a national insurance/healthcare scheme that allows unfettered malpractice lawsuits. It would be kind of like suing the fire dept for damages to your house incurred while fighting a fire.
I cant find the link to where Ive read this, so take it as you will, but also americans seek a second opinion something like 60% of the time, while the other developed nation that comes closest is Japan at around 20% of the time.
There are definately more reasons than these, but personally I think the cost of malpractice insurance accounts for the greatest disparity.
I don’t have a cite, but I don’t believe Canada restricts malpractice suits (and I’m Canadian). In most cases, doctors are still individually liable for malpractice, so your analogy doesn’t apply. We do tend to be less litigious than Americans!
Another possible factor: I have heard from some Europeans (and no, I don’t have a citation for this) that in their countries, the really expensive life-prolonging procedures don’t happen as often as in America. For example, here in the US, if a baby is born at 25 weeks, the automatic response is to go all the way to save the infant’s life. Parents have to intervene if they don’t want invasive, scary, expensive, but possibly life-saving procedures done. Whereas in Europe, it may be considered more natural to “let Nature take its course” (and incidentally refrain from further burdening the system). Likewise with the elderly or very ill; where Americans will spare no effort to keep someone alive, other countries will let things go.
As a generality, this is something I’ve heard. I’m sure there are many exceptions (my own grandmother being one). I don’t know which style is ‘better’ overall; I’m inclined to think that both could use some moderation.
-The huge cost of insurances due to the large number of lawsuits
-A number of hightech medical equipment larger than necessary, due to the concurrence between private hospitals, and the overuse of these equipments when it’s not really needed (in order to amortize their costs and, once again, to avoid lawsuits). More generally, overprescription.
-Lacks of preventive care, in particular people not having a health insurance and waiting too long before seeking medical care, resulting in more serious (and more costly) pathologies.
-The higher cost of drugs.
-The profit margins of the private health insurance companies
And yes, I gathered from a recent thread that doctors in western europe are paid way less than in the US, which probably adds to the costs. The “regular” price for a visit to a generalist in France, for instance, is 20 € (more or less the same in dollars, depending on the currency market) , and 30 € for a homecall (doctors can charge more if they wish but for various reasons I’m not going to explain, most don’t). I wouldn’t know for doctors working in hospitals.
The authors found that bureaucracy accounted for at least 31 percent of total US health spending in 1999 vs. 16.7 percent in Canada
I remember reading once that medicaid only had a 3% bureaucracy overhead while private insurance has a 25% overhead. i guess if this were true & the US had state subsidized healthcare that would cut about $340 billion out of healthcare costs. COmbined with more doctors (which would lower costs), price controls on drugs, etc that could account for about a 4-6% difference or so.
It’s the converse of monopoly. In a monopoly, several consumers compete to buy produce from a sole supplier. In a monopsony, several suppliers compete to sell produce to a sole consumer.
In the European model, the state is not the monopoly supplier of medical services; it’s the monopsony purchaser of medical services. It’s not a true monopsony, of course, but the state is a hugely dominant purchaser, with enormous bargaining power, which it generally uses to get lower prices not just for labour but for drugs, equipment, and so forth. Health insurance companies, however large, don’t have the same advantage because suppliers can (and do) play one insurer off against another.
In another word, efficiency. pervert makes the point that the costs of collecting insurance premiums shows up in the US figures while the costs of collecting taxes doesn’t show up in the European figures. That may be true, but it’s also true that the average cost of collecing taxes is probably a hell of a lot lower than the average cost of collecting insurance premiums. Similarly, for a hospital, billing the state or a state purchasing agency is a hell of a lot cheaper than billing a large number of insurance companies and individual patients.
It’s also possible that resource allocation is more efficient in the European model. Two thoughts occur to me here.
First, I’ve read that, in the US, for the typical individual something like half of all lifetime medical expenditure is incurred in the last twelve months of life. I don’t know whether the same is true in Europe. If we assume that the goal of medical expenditure is to prolong life/to enhance the quality of life then you’d have to suspect that the 50% expenditure incurred in the last 12 months is not necessarily delivering great returns in that regard. FWIW, I don’t think that the US enjoys significantly longer life expectancy than most Western European countries.
Secondly, it occurs to me that, with a large proportion of US healthcare delivered through health insurance provided by employers, the allocation of resources will be skewed towards those in good-quality employment, and away from those in poor-quality employment, or in unemployment, whereas medical needs are likely to be skewed in the opposite way. Hence, inefficiency.
Of course, there are important ethical, social and cultural factors here. The US model may be suboptimal in terms of efficiency, but that’s not to say that it doesn’t achieve other goals which American society values.
The rate at which our medical costs are increasing are going up pretty fast as well. Drug costs at 15% and the rest at 5% which evens out to about 10%.
Another factor is that the US tends to have lot more high end, expensive medical equipment. For example, Canada, with ~30 million people, has about 40 MRI machines. California, also with ~30 million people, has over 400 MRI machines. The US also has much shorter wait times for elective surgery; in 2001 38% of UK patients had to wait more than 4 months for elective surgery, compared to 5% in the US. (Warning - .pdf file).
Looks like no one has mentioned one of the big factors: In countries with socialized medicine, access to health care is rationed. Waiting lists in Canada are much longer than they are in the U.S. Access to high tech equipment like MRI and CT scanners is much poorer.
For example, in 1991 there were 2000 CAT scan machines in the U.S. There were 15 in Canada. The city of Tucson had more CAT scan machines than the entire province of Newfoundland.
Canada also limits health care expenditures by rationing necessary surgery. For example, the wait for a heart bypass operation in Toronto is over a year.
These waiting lists are starting to take its toll. The survival rate in Canada for people diagnosed with colon cancer is about 75%. In the US it’s over 90%. This can probably be attributed to early detection in the U.S., because people in Canada wait months for diagnostic services, and when the cancer is discovered it’s more advanced.
Then there’s the offloading factor - The United States does a lot of complex, expensive medical treatments on foreigners. Many Canadians spend their life savings on health care in the U.S. when they can’t get lifesaving surgery in Canada. After all, if you were diagnosed with heart trouble, would you want to wait a year for surgery in Canada? What if your chance of surviving that year was only 50%?
Remember house calls? Well get this: the waiting list just to see a general practitioner in Canada averages 16.2 weeks. I wonder - how many of you Americans who want a Canadian-style system would be happy about waiting for four months just to get in and see your family doctor?
Of course, for specialties it’s worse. If you get in to see your GP and complain of headaches, he might schedule you for a CAT scan. In five months. In the meantime, here’s some nice aspirin for you.
Conditions that could be caught early and reversed with aggressive treatment become chronic in Canada, because it takes so damned long to get and receive treatment. Rheumatoid arthritis can be controlled or even reversed with aggressive drug therapy. But if it takes your months from the time your knee starts hurting until your doctor will see you, the knee may already be suffering bone damage. Then the doctor will refer you to a rheumatologist - who will see you in three or four months. Then he’ll start you on a conservative treatment, and you won’t see him again for another four months. Etc.
I know people in the States who have a problem like that and they call their doctor and are in in a few days. Then they start a round of treatment under direct care, seeing the doctor every week or two until the problem is fixed or controlled.
Finally, an increasingly common form of rationing in socialized medical systems is to refuse treatment for the elderly. If you’re over 65 in some countries and need a heart bypass, guess what? You aren’t going to get one. There have been rumblings about refusing certain operations to people who refuse to give up smoking, or who are grossly overweight, etc. When you can’t regulate demand with money, you have to just ration what you give out. And the elderly consume the vast majority of resources, so if the government needs significant cuts, guess where they’re going to look? This is already happening in many countries with socialized medicine.
Also, the U.S. spends a huge amount of money on research and development of medicines, diagnostic machinery, and new procedures. These costs are largely absorbed by Americans, and the rest of the world gets somewhat of a free ride. You know that controversy about re-importing drugs from Canada into the U.S.? That’s because Canada pays less for U.S. drugs than U.S. citizens do. We also benefit from your breakthroughs in other treatments. The wealthy in the U.S. can pay huge dollars for treatment, which stimulates research into things like artificial heart valves, artificial limbs, etc. Once those products are developed, they become available to the general world market at lower costs.
There are no free lunches. You can’t wave a magic wand and make health care cheaper. You can ration your care by letting the market set prices, or you can set the price and ration health care directly. No countries on this planet are wealthy enough to provide full medical care to everyone, whenever everyone wants it.
Could it be people in the US are not as healthy? I mean the media keeps sending out the message that most of the US population is overweight. This factor could lead to many other related illnesses which places further burdens on the health care system.
Considering that Tucson and Newfoundland have comparable populations (about a half million each), this isn’t really particularly stunning.
You mean for a house call? Or to get any old appointment to see a doctor? Cuz if you mean the latter, I’d like to see a cite. I’ve never waited more than a couple days.
I don’t think anybody’s suggesting that the Canadian or other single-payer healthcare systems don’t have any problems, or that there isn’t anything we’d do differently from Canada if we adopted such a system. However, I think many Americans would indeed prefer such a system, even with its flaws, over the current American one in which a growing percentage of the population can’t even afford health insurance or routine health care, insurance company overheads and profits keep driving up the costs, and more and more health problems are neglected until they have to be treated in emergency rooms, an extremely inefficient use of healthcare resources.
There are no free lunches. You can’t wave a magic wand and make health care cheaper. You can ration your care by letting the market set prices, or you can set the price and ration health care directly.
Actually, you can do both. Many developed countries have publicly funded healthcare along with parallel systems of private medical practice and insurance for those who can afford them. (Including, according to this site, Canada.)
If that is the worst you can make it look then yes. Comparatively we spend a similar amount on public healthcare as the Canadians and the British do.
Besides, there are other countries without such problems. Perhaps we can look at them. Thats the nice thing about arguing for socalized healthcare. There is only America to show as an example of non socalized healthcare whereas even if you do show the worst examples of socalized healthcare they are much more cost effective compared to us.
SS: *Also, the U.S. spends a huge amount of money on research and development of medicines, diagnostic machinery, and new procedures. *
A lot of this, of course, is funded by the government, and would stay in place even if we instituted a single-payer health care system.
*Conditions that could be caught early and reversed with aggressive treatment become chronic in Canada, because it takes so damned long to get and receive treatment. *
one reason for the ridiculous cost of healthcare is the need for physicians to insure themselves at absolutly ludicrous prices.
But, simple greed is definitly another factor. Dentists in particular I think must go to a “how to scam the public” seminar.
The costs that we pay are no where near the actual cost of the procedure. Hospital operating rooms and physicians fees are at the point where simple thievery is the only explanation. It really is a shame how the greed of some professionals has turned what was a noble occupation into such a disgraceful opportunity for theft but that is the USA in the 00’s.
From the above-linked report: