Health Care Around the World

One of the more bizarre aspects of the health care "debate" was the strident insistence by reform opponents – and some supposedly objective reporters – that American health care was/is the best in the world. The truth is, many industrialized nations provide better overall health care for far less money than the United States. Many Americans don't know this – and some American corporations and politicians have worked very hard so that they don't know it.

The health care reform bill that passed is flawed, but is still a major step forward and should ensure basic care for millions of Americans who had none before. We'll see how the reality matches the plan and the promises. Still, the American health care system will continue to need improvement, and it would be foolish to ignore successful ways other nations have dealt with the same problems.

It's also valuable to examine what our old system really entailed and how it measured up. (Parts of the new health care law take effect this year, while other measures won't apply until 2014, so in several cases the "old system" is what we still currently have.) In the old system, if you had health insurance, and if you were given care, it could be good and even excellent. But the old system was unsustainable, and for all its cost, had major gaps. Under the old system, about 46 million Americans, or roughly 1 in 6, did not have health insurance. Other Americans with health insurance could be denied essential care. Currently, every year, many Americans die from lack of health care. Exact numbers are elusive, but studies estimate that number as anywhere from 22,000 to 45,000 deaths per year. (See the Remote Area Medical Care story for how dire it's been.) Reform should provide health care for those who don't have it now, and will actually save money in the long run – in theory, the new law will cover 95% of the population and cut the deficit by 1.3 trillion over 20 years. We'll see how it all actually plays out, but that sounds like a big improvement.

World Health Studies

There are a few different world health studies, but one of the more user-friendly I've found comes from the Organisation for Economic Co-Operation and Development (OECD). Their Health Data page has a publications tab that lists their most recent major report, "OECD Health Data 2009: Statistics and Indicators for 30 Countries." You can view web versions of its charts or download PDF versions here. Most of the charts link Excel sheets which provide further data.

The most staggering statistic is probably health expenditure per capita:


(Click for a larger view.)

The United States' cost is a staggering $7,290 per capita, while the next most expensive, Norway, is $4,763, and they cover everybody. France is at $3,601 and Britain is at $2,992, even though they cover everybody and their overall care is typically rated better than that in the United States.

Next up, here's health expenditure in relation to GDP:


(Click for a larger view.)

The United States spends 16% of its Gross Domestic Product on health care, and the OECD puts the number at 19.5% for "actual final consumption." The next closest country is France, at 11% of GDP, and again, it covers everybody and is consistently ranked near the very top for overall health care.

Here's a chart on coverage (the old system):


(Click for a larger view.)

The United States hasn't stacked up well in life expectancy, either:


(Click for a larger view.)

There are many other charts to peruse. The United States does fairly well with cancer. Some forms of cancer are much more treatable now, and it doesn't hurt that, in America, there's been a overall decline in smoking and thus lung cancer (the most common cancer worldwide). The United States doesn't measure up too well in heart disease and stroke, though, or infant mortality. We'll see how these statistics change in the coming decades.

The World Health Organization of the United Nations also puts out useful reports, their most recent major one being The World Health Report 2008. Their World Health Statistics 2009 has some more recent data. The site compiles other data, which can be searched, sorted and exported (you can make your own Excel charts). The focus of the health report has varied over the years. Their World Health Report 2000 focused more on comparative health care systems:

The World Health Organization has carried out the first ever analysis of the world's health systems. Using five performance indicators to measure health systems in 191 member states, it finds that France provides the best overall health care followed among major countries by Italy, Spain, Oman, Austria and Japan...

The U.S. health system spends a higher portion of its gross domestic product than any other country but ranks 37 out of 191 countries according to its performance, the report finds. The United Kingdom, which spends just six percent of GDP on health services, ranks 18th. Several small countries – San Marino, Andorra, Malta and Singapore are rated close behind second- placed Italy.

The World Health Organization's reports focus a great deal on malaria, tuberculosis and diarrhoeal diseases (cholera, dysentery, typhoid, contaminated food and water) that tend to be less prevalent in the United States. But for those interested in statistics and learning more about health issues around the world, it's a good place to look. As for health care in the United States, we'll see how much it can improve its standings in coming years.

Sick Around the World



I've been reading T.R. Reid's 2009 book The Healing of America: A Global Quest for Better, Cheaper, and Fairer Health Care, which is a well-written, fairly short survey of the major health care models around the world. Reid asks about treatment for his stiff shoulder, and looks at costs to patients and the benefits of each system. He also asks about flaws in each system and examines their cost controls.

Reid's book grew from an excellent 2008 Frontline episode, "Sick Around the World." You can watch it online. If your time is limited, it may be the best single introduction to how other countries approach health care and how the United States stacks up in comparison. The site also offers several helpful links. Here are the four basic models used around the world, a Q&A with Reid, and a Washington Post discussion with Reid (all from 2008). He also discussed his book on Fresh Air and C-Span. A 2009 article he wrote, "5 Myths About Health Care Around the World," covers many of the basics.

As Reid writes in his book, many of these other systems will be familiar to Americans already. The four main models are the Beveridge Model (Great Britain, Scandinavia, Cuba), the Bismark Model (Germany, France, Japan, Switzerland), the National Health Insurance Model (Canada, Taiwan) and Out-of-Pocket (rural areas of Africa, India, China and South America). Reid explains these in more depth in his book, but as he points out, they should all be somewhat familiar to Americans:

These four models should be fairly easy for Americans to understand because we have elements of all of them in our fragmented national health care apparatus. When it comes to treating veterans, we're Britain or Cuba. For Americans over the age of 65 on Medicare, we're Canada. For working Americans who get insurance on the job, we're Germany.

For the 15 percent of the population who have no health insurance, the United States is Cambodia or Burkina Faso or rural India, with access to a doctor available if you can pay the bill out-of-pocket at the time of treatment or if you're sick enough to be admitted to the emergency ward at the public hospital.

The United States is unlike every other country because it maintains so many separate systems for separate classes of people. All the other countries have settled on one model for everybody. This is much simpler than the U.S. system; it's fairer and cheaper, too.

Sick Around America

Frontline also did a 2009 episode, "Sick Around America," but it's a mixed bag and disappointing in some major respects. It does a good job of documenting health care insurance woes, but does a poor and even deceptive job on solutions. It features many health insurance executives and lobbyists, which wouldn't necessarily be bad, but there's little to no skeptical, critical treatment of their claims. Basic, core issues raised in "Sick Around the World" are ignored. Reid was also involved in "Sick Around America." However, as Counterpunch reported:

But even though Reid did the reporting for the film, he was cut out of the film when it aired this week.

And the film didn't present Reid's bottom line for health care reform – don't let health insurance companies profit from selling basic health insurance.

They can sell for-profit insurance for extras – breast enlargements, botox, hair transplants.

But not for the basic health needs of the American people.

Instead, the film that aired Monday pushed the view that Americans be required to purchase health insurance from for-profit companies.

And the film had a deceptive segment that totally got wrong the lesson of Reid's previous documentary – Sick Around the World...

The Counterpunch piece next quotes claims from "Sick Around America" featuring insurance lobbyist Karen Ignagni, who favors a mandate for citizens to buy health insurance, but leaves something crucial out from her claims:

Other countries do not require citizens buy health insurance from for-profit health insurance companies – the kind that Karen Ignagni represents.

In some countries like Germany and Japan, citizens are required to buy health insurance, but from non-profit, heavily regulated insurance companies.

And other countries, like the UK and Canada, don't require citizens to buy insurance. Instead, citizens are covered as a birthright – by a single government payer in Canada, or by a national health system in the UK.

The producers of the Frontline piece had a point of view – they wanted to keep the for-profit health insurance companies in the game.

TR Reid wants them out.

Reid also said that “I don't think they deliberately got it wrong, but they got it wrong.” Frontline has contested that Reid played a big role in "Sick Around America." Regardless, I can't see how someone could see "Sick Around the World," let alone help make it, and then ignore its central finding in the companion piece: For-profit insurance companies should not be in charge of basic, essential care.

For-profit health insurance companies are parasitic, providing no actual health care, which is provided by doctors. Insurance is merely a payment mechanism, and the industry is responsible for much (but not all) of the colossal waste in the American system. Most American politicians view eliminating private health insurance entirely and moving to a single payer system as too radical and impractical. That's why health care reform took the shape it did. The new law leaves for-profit health insurance companies in place, and doesn't regulate them as strongly as other countries do. However, in theory the new law will curb price-gouging somewhat, and end rescission and other abusive practices by health insurance companies. Future fixes to health care could push this dynamic further, as needed. Health insurance companies could continue to exist, but could operate more like they do in Germany, France and Switzerland.

Administrative costs for government, not-for-profit program Medicare are normally estimated at 2-3% (although it may slightly higher). In comparison, the costs of private, for-profit insurance for administration, advertising and profit run at 12% on average, can be pushed as low as 7%, yet can run as high as 26% or even 30% (risk pool size is a major factor). The executive compensation at large insurance companies is staggering – and many industry practices are appalling. As DDay chronicled this past October,

Anthem Health Plans of Maine, a subsidiary of WellPoint, is suing the state because they want to increase premium rates by 18.5% on their 12,000 individual insurance policy holders, so they can guarantee themselves a 3% profit margin...

Like many other states, Anthem Health Plans hold a monopoly on the individual insurance market in Maine, controlling 79% of all the plans. Also like many other states, they are licensed to sell insurance through the Department of Insurance, who must clear all rate increases prior to implementation. Originally, Anthem Health Plans were a nonprofit Blue Cross and Blue Shield corporation licensed to practice in Maine since 1939. In 1999, Anthem bought the business and began to operate it as a for-profit company. Since that point, Anthem has raised premium rates 10 times, and 8 of those times have been double-digit rate increases...

The average individual Maine rate-payer is paying four times as much for insurance than they did ten years ago.

But this isn't good enough for Anthem Health Plans...

The details get even uglier. WellPoint is the same company being investigated by Congress after it announced in February that it would raise premiums on some California customers by a whopping 39%. It's not the only company doing this sort of thing, either. The new law may help, but it would be wonderful to end these sort of abuses altogether.

Many of the problems in the old system – and the new system going forward – are simply unnecessary. In Sick Around America, Part 5, roughly 49 minutes in, "Healthcare Industry Consultant" Robert Laszewski says:

We have 2.2 trillion dollar health care system full of vested interests, stakeholders, and lobbyists, and I have yet to meet a doctor who thinks he should take less. Every doctor I meet thinks he's underpaid. I have yet to meet a hospital executive who thinks he can operate, he or she can operate, on less. I have yet to meet a patient who is willing to sacrifice care. Every patient I've ever met in the United States equates quality care with access to whatever they want. I haven't met anybody that's willing to take less. And until we have that conversation, we're just sort of nibbling around the edges.

Laszewski has a point, but given that other countries do much better at much lower cost, his implied suggestion about sacrifice ignores a great deal. The 'hard truths' aren't primarily about doctors or patients accepting less. The hard truths involve not defending a broken system rife with unnecessary waste and inefficiency. Let's take Laszewski's examples one at a time.

Doctors in the United States are paid much better than most doctors around the world. However, in the countries Reid examines, doctors are still generally well paid if not as exorbitantly, and the position still carries great status (and sometimes other perks). These foreign doctors spend a minimum of time on paperwork and billing, whereas American doctors face a crushing load on that front. The foreign doctors carry malpractice insurance, but most pay in a year what American doctors pay in a single month – and the foreign doctors are rarely sued. Many other nations also pay for medical educations at least partially, in contrast to the high debt American medical students incur. One idea suggested for the U.S. is to invest more money into medical students' educations, in return for stints at public hospitals or working as general practitioners. These and other reforms would ease burdens on doctors, allowing them to spend more time actually practicing their profession. Many of them would find that appealing.

Many of these factors apply to running a hospital, too. Providing basic care for the entire populace would also mean far fewer costs incurred by people using emergency care for routine treatment. Standardizing medical forms and using electronic records would cut many costs across the nation. Meanwhile, elimination (or tight regulation) of for-profit insurance companies would massively cut administrative costs for hospitals, because they would have much less paperwork and wouldn't have to fight for reimbursement as much (if at all).

As for the claim "Every patient I've ever met in the United States equates quality care with access to whatever they want," I seriously doubt that's true – or it dodges the point with the term "quality care." Laszewsk's hypothetical patient is one with money and/or health insurance. People who lack any health care now would be thrilled to get basic, essential care. As for those who currently have health insurance, when they're sick, most patients simply want to get better, not necessarily to run a series of extra tests or a specific one. Patients generally trust their doctors and their recommendations. One solution is to have basic care completely covered, and if patients want something more exotic, they can pay out of pocket or with supplemental insurance, as is currently the case under many plans in the U.S. (and also France and other nations). As Reid shows, there are several successful models around the world, and while all have their drawbacks as well, it would be foolish not to study them for ideas.

T.R. Reid isn't the only good health care reporter out there, of course, nor is he flawless. Bob Somerby has criticized Reid and other reporters for not clearly explaining how wasteful the American system is. I agree that coverage should emphasize the key statistics, because they're essential to understand. It's harder for a politician to oppose any sort of health care reform when the public knows that other countries get good or better results, with a massively lower price tag: France at $3,601 per capita and Britain at $2,992, compared to the United States at a staggering $7,290. (We'll see if that number goes down, and by how much.)

However, I also think Reid does a splendid job overall. "Sick Around the World" consistently shows that there are better, cheaper and less wasteful ways to deliver health care. If we had politicians whose primary goal was to improve the system, they'd do want Taiwan does in the show: examine the major countries of the world, see what works best, and adapt that for America.