Healthcare: Comparing the U.S. to the Leaders

I came across an article that is so good, I have to share it liberally. If I am told I am running afoul of copyright, I will of course take this blog down. But in the meantime, you will learn a lot about healthcare!  Basically, in this article, the authors, Aaron Carroll and Austin Frakt opine about two-way matchups between eight different countries when it comes to the healthcare systems they have in place to insure and care for the health of their respective citizens. This is like a round-robin tournament comparing the strengths and weaknesses of various healthcare systems to each other. The article does go into more detail, and is worth a read if you’re that interested. Let the games begin!

The authors of the article vote:

• Aaron Carroll, a health services researcher and professor of pediatrics at Indiana University School of Medicine
• Austin Frakt, director of the Partnered Evidence-Based Policy Resource Center at the V.A. Boston Healthcare System; associate professor with Boston University’s School of Public Health; and adjunct associate professor at the Harvard T.H. Chan School of Public Health

And so do the following three economists and physician experts in healthcare systems:

• Craig Garthwaite, a health economist with Northwestern University’s Kellogg School of Management
• Uwe Reinhardt, a health economist with Princeton University’s Woodrow Wilson School of Public and International Affairs
• Ashish Jha, a physician at the Harvard T.H. Chan School of Public Health and the director of the Harvard Global Health Institute

 

Before I show you the match-ups, I will provide a little grist for the mill from uber-thinker, Nobel Prize-winning economist, Joseph Stiglitz. He writes in his barn-burner of a book, Inequality for All:

It is remarkable that even though the United States is allegedly a highly competive economy, certain sectors seem to continue to reap excessive profits. Economists marvel at our healthcare sector and its ability to deliver less for more: health outcomes are worse in the United States than in almost all other advanced industrial countries, and yet the United States spends absolutely more per capita (and more as a percentage of GDP), by a considerable amount. We’ve been spending more than one-sixth of GDP on healthcare, while France has been spending less than an eighth.

 

Stiglitz goes on to note that “[p]er capita spending in the United States has been two-and-a-half times higher than the average of the advanced industrialized countries.” Not exactly what I would imagine a conservative would consider to be functional or sustainable or acceptable. Why the reason for this disparity? Stiglitz: “…rent-seeking, in particular on the part of the health insurance companies and drug companies, plays a significant role.” He defines rent seeking as such: “Much of the inequality in our economy is the result of rent seeking. In their simplest forms, rents are just redistributions from the rest of us to the rent seekers” (i.e., the owners of capital: essentially, the wealthy). He continues: “But often, rent seeking involves a real waste of resources than lowers the country’s productivity and well-being. It distorts resource allocation and makes the economy weaker.” Yes, it does indeed.

 

UNITED STATES VS. SINGAPORE

AARON: United States. Singapore is intriguing because it’s so different from other systems. But its huge mandatory savings requirement would be a nonstarter for many in the United States.

CRAIG: United States. Singapore, a scrappy underdog, has become a fan favorite of conservatives. But its reliance on health savings accounts is problematic: When people are spending more of their own money on healthcare, they tend to forgo both effective and ineffective care in equal measure.

AUSTIN: United States. It’s hard for me to overlook Singapore’s lack of openness with data.

ASHISH: United States. The lack of data in Singapore is a problem, and it had higher rates of unnecessary hospitalizations and far higher heart attack and stroke mortality rates than the United States. Plus, the U.S. has a highly dynamic and innovative healthcare system. It is the engine for new diagnostics and treatments from which Singapore and other nations benefit.

UWE: Singapore. It’s hard to defend the messy American health system, with its mixture of unbridled compassion and unbridled cruelty.

 

CANADA VS. BRITAIN

AARON: Britain. It’s efficient. Given the rather low spending, it provides great access with acceptable outcomes.

CRAIG: Britain. Patients in Britain have a greater ability to shop across providers (using additional private insurance). This, combined with reforms within the N.H.S., helped increase competition and quality.

AUSTIN: Britain. While the countries are close in spending and quality, Britain has much lower cost-based barriers to access.

ASHISH: Britain. Access problems can be profound in Canada — nearly one in five Canadians report waiting four months or more for elective surgery, which can be more than just an inconvenience.

UWE: Canada. The Canadian system is simpler for citizens to understand and highly equitable.

 

AUSTRALIA VS. FRANCE

AARON: France. It provides almost everything you’d want, and it’s expensive only compared with countries other than the United States. (Compared with the U.S., it’s a bargain.)

CRAIG: France. It has seemingly done a better job of using markets to create competition across public and private hospitals — which provides incentives for quality provision and innovation.

AUSTIN: Australia. It was a close call. Australia achieves good outcomes (by some but not all measures better than France) with a lot less spending, making it a better value.

ASHISH: France. Both countries cover everyone, but people in France report somewhat fewer problems getting access to care, as well as shorter waiting times.

UWE: France. The Australian system is basically two-tiered: a public insurance-and-delivery system, and another based on private health insurance, each of which cover roughly half the population. This seems to work well in Australia, but in the U.S. the public system most likely would be badly underfunded. Therefore, France would be superior.

 

SWITZERLAND VS. GERMANY

AARON: Switzerland. It has superior outcomes. It’s worth noting that its system is very similar to the Obamacare exchanges.

CRAIG: Switzerland. The Swiss system looks a lot like a better-functioning version of the Affordable Care Act. There’s heavy, but quite regulated, competition among insurers and an individual mandate.

AUSTIN: Germany. Germany has a low level of cost-based access barriers — tied with Britain for the lowest among our competitors.

ASHISH: Switzerland. Switzerland outperformed Germany on a number of important quality measures, including fewer unnecessary hospitalizations and lower heart attack mortality rates.

UWE: Germany. The Swiss social insurance system — a latecomer, enacted only in the 1990s, and financed by per-capita premiums — is less equitable than many other European systems, including Germany’s.

 

UNITED STATES VS. FRANCE

AARON: France. France provides an amazing level of access and quality for the cost. The U.S. is considered the driver of healthcare innovation, which comes at a high price. But there are other ways to incentivize innovation in the private sector besides how we pay for and deliver care.

CRAIG: United States. The U.S. system is a bit of a mess in that it is quite expensive and doesn’t offer complete coverage to its populace. But the system really does have the strongest incentives for innovation on medical technology — which provides an amazing amount of welfare for citizens around the globe.

AUSTIN: France. It’s hard to justify the very high level of U.S. spending based on innovation alone, particularly without mechanisms to steer innovation toward technologies that are cost-effective.

ASHISH: United States. France has a far more equitable system, with few delays and reasonably good outcomes. However, the U.S. delivers a superior quality of care on the measures that matter most to patients, and the system is far more dynamic and innovative. It was close, but I picked the United States.

UWE: France. The U.S. is just too expensive for what it delivers, and includes too much financial insecurity to boot. At international healthcare conferences, arguing that a certain proposed policy would drive some country’s system closer to the U.S. model usually is the kiss of death.

 

SWITZERLAND VS. BRITAIN

AARON: Switzerland. It has better quality, and perhaps access, but those come at a higher cost. I’m willing to make that trade-off.

CRAIG: Britain. Switzerland’s system — privately funded with private insurers — is often held up as a bastion of competition. But it is not necessarily more of a market than Britain; it just hides the heavy hand of government a bit more. In reality, the insurance and provider market is heavily regulated.

The U.K. system is almost entirely publicly funded, but it has done a lot to try to increase the competition between facilities, which has increased the quality of service.

AUSTIN: Britain. It systematically incorporates cost-effectiveness into coverage decisions.

ASHISH: Switzerland. These are two countries with high-performing health systems, but Switzerland has better access and quality, albeit at somewhat higher costs.

UWE: Switzerland. Switzerland has better facilities and speed of access to care.

 

FRANCE VS. SWITZERLAND

AARON: Switzerland. This is a tough call. Switzerland does a good job of combining conservative and progressive beliefs about healthcare systems into a workable model providing top-notch access and quality at a reasonable cost. It doesn’t hurt that it does so through private (although heavily regulated) insurance.

CRAIG: France. Its system has more competition among providers than Switzerland’s does.

AUSTIN: Switzerland. The Swiss system is so close to the A.C.A.’s structure (which, to date, has survived all manner of political attacks) that something like it could work in the U.S.

ASHISH: Switzerland Both of these countries spend a lot on healthcare, outpacing the average among high-income countries, and both perform comparably on measures of access to care. However, in general, the Swiss healthcare system delivers a higher quality of care across a range of measures and invests more in innovation that fuels new knowledge and, ultimately, better treatments that we all benefit from.

UWE: France. It is cheaper, its financing is more equitable, and its system is simpler.

 

The upshot is that Germany and Switzerland did quite well, and the United States was clearly expensive, ineffective in coverage, and riddled with special interests (my opinion coming through). It does, however, offer world-class services to those who can pay privately and who need the latest treatments and devices. 

I’m sorry we don’t have a single-payer option for all Americans like other countries do, or like we do for Medicare. The one-time progressive thinker, Barack Obama, agrees: “I happen to be a proponent of a single-payer universal health care program. I see no reason why the United States of America, the wealthiest country in the history of the world, spending 14 percent of its Gross National Product on health care, cannot provide basic health insurance to everybody….” But it’s not just politicians who are beholden to a veritable of lobbyists bearing industry money. Bill Maher quips: “Why haven’t Americans arisen en masse to demand a strong public option [for healthcare reform]? Because ‘The Bachelor’ is on. We’re tired and our brain stems hurt from washing down French fries with McDonald’s orange drink.” I’ll finish with a wonderful quote by one of the remaining “men of letters,” Lewis Lapham: “I graduated from Yale in the 1950s, and the word public was still a good word. Public meant public health, public service, public school, commonwealth. And private suggested greed, selfishness, and so on. Those words have been turned around. That was the great triumph of the Reagan Revolution.”

 

Here is a description/summary of the five panelists:

View other blogs in the category of social and economic justice here on ValuesoftheWise.com

Here is a piece on the Swiss model from the libertarian perspective.