In
Every Other Country ... Comparing Health Care Systems and Resultsby
Art Myatt a MichUHCAN Publication September, 2001
"Of
all the forms of inequality, injustice in health care is the most shocking and
inhumane." - Martin Luther King, Jr.
Contents:
Introduction Statistics and Sources
Australia - Austria - Belgium - Britain
- Canada - Cuba - Denmark - Finland - France - Germany - Israel - Japan - Netherlands
- New Zealand - Norway - Spain - Sweden - United States Conclusions
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Introduction
The
American health care system is in trouble, and if nothing is done to change it,
will soon be in crisis. Perhaps it would be more accurate to say it will be in
crisis everywhere, whereas now the crisis is localized to only some areas. The
situation was bad before HMOs were touted as "the solution" to rising
costs, and has only gotten worse. When emergency rooms in an area are closed,
they are closed for everyone. When hospitals in the cities are closed and not
replaced, the system has failed, plain and simple. Where it has not yet failed,
it costs too much and does too little.
Patients
are not satisfied with their care and go broke trying to pay for prescription
medication. Doctors argue with insurance companies over treatments and payments.
Nurses have to fight for decent pay and fight to avoid excessive overtime, but
don't get to use much of their time on patient care. Untrained workers in hospitals
fear the responsibilities involved in dealing with IVs, dressings, blood draws,
and a host of things that nurses should be doing, but find it difficult to speak
out because they need their jobs. The government's idea of patients' rights is
to make a compromise on who can sue whom for how much.
It
does not have to be this way. It is not this way in most industrialized countries
around the world. If we could pay a bit of attention to the health care systems
in these other countries, perhaps we could see how to fix our own.
This
booklet attempts to do a very rough comparison of the health care system of the
United States with the health care systems of seventeen other nations. We are
only looking at how good a given health care system is for the patients, the citizens
of the country. We are not looking to see how well it treats insurance companies
or drug companies, or how much money it generates for politicians.
Certainly,
more sophisticated and analytical studies have been done. This booklet is only
an attempt to highlight the most basic facts relevant to health care, without
resorting to a single chart, graph or table of numbers.
__________________________________
Statistics
and Sources
Infant mortality is one common
measure of how good health care is. It counts the number of children born, and
also counts the number who die in the first year of life.
The
cause of death does not matter here. No child is uncounted because the death is
somehow "excusable." The number does not tell you if children are dying
because of genetic defects, or disease, or malnutrition. It does not count abortions
or miscarriages. It just says that, out of every thousand children born alive,
some number died. The lowest number reached shows what is possible. Any higher
number indicates the system is not doing what is possible.
Life
expectancy also indicates how good the health care of the society is.
This
is not 100% the responsibility of doctors and hospitals, of course. One country
may be less polluted than another, and so have less cancer to deal with. The citizens
may be more inclined to walk to work, or ride bicycles, which is less convenient
and means less sales for the auto industry, but is certainly healthier. It may
have to do with the availability of health care; for example, a diabetic might
get early diagnosis and proper treatment, instead of neglecting the symptoms (because
of no insurance) until the condition becomes life-threatening. All these factors
go into life expectancy. And perhaps all these factors should be the concern of
a comprehensive system of health care, which should not be just a system of disease
treatment.
In the end, it should be fair to
say that the average citizen will not live so long if the health care system is
terrible, regardless of what other factors come into play.
All
information on infant mortality and life expectancy comes from the U. S. federal
government, specifically the "World Factbook" found on the web at http://www.odci.gov/cia/publications/factbook/index.html
- and yes, this is a public service of the Central Intelligence Agency. If there
is any error in these figures, or slant in favor of the United States, we can
blame the CIA.
Gross Domestic Product (GDP)
is a measure, not directly of incomes, but of how much wealth is available to
the society in a given year. Using this figure on a per capita basis tells us
how much wealth is available for each person in the society, and allows fair comparisons
between countries of greatly different sizes. All GDP values here are given in
United States dollars. The basic information of populations of countries other
than the US, and the figures for per capita GDP, also come from the "World
Factbook" mentioned above. Figures for what percentage of GDP is spent on
health care come from the Organization for Economic Cooperation and Development
(OECD) Health Data 2001 publication. Numbers for the populations of various states
and regions of the US is the latest available from the US Census Bureau 2000 Census.
Much
of the commentary on the history and character of the health care systems of various
countries comes from Physicians for a National Health Program. Some of the commentary
on Cuba can be attributed to a paper, "Health Care in Cuba" by Jennifer
Hamm, published on the web site of Tulane University. Information on Israel comes
from the "National Health Insurance" page of the web site of the government
of Israel.
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AUSTRALIA
Australia's
population of 19,169,083 people is roughly the same as that of Texas (20,851,820).
Its infant mortality rate is 5.04 per 1,000 live births, noticeably better than
the US's 6.82. Life expectancy at birth is 76.9 years for men and 82.75 years
for women, about 2.6 years longer than in the US for each sex.
Their
per capita GDP is $22,200 in US dollars, about 65% of the US's $33,900. Australia
spends 8.6% of its GDP on health care. The US spends 12.9%. This works out to
$1909 per capita for Australia, vs. $4373 for the US - but the Australians get
better results.
The Australian government administers
the compulsory national health insurance program (Medicare). National health insurance
is funded by a mixture of general tax revenue, a 1.5% levy on taxable income (which
accounts for 18.5% of federal outlays on health), state revenue, and fees paid
by patients. The government funds 68% of health expenditures (45% federal and
23% state) and has control over hospital benefits, pharmaceuticals, and medical
services. States are charged with operating public hospitals and regulating all
hospitals, nursing homes, and community based general services. Additionally,
the states pay for the public hospitals with federal government assistance negotiated
via five yearly agreements. Mainly not-for-profit mutual insurers (private insurance)
cover the gap between Medicare benefits and schedule fees for inpatient services.
Private insurance covers 1/3 of the population and accounts for 11% of health
expenditures.
Patients are free to choose their
GP. Primary care physicians act as gatekeepers, and physicians are generally reimbursed
by a fee-for-service system. The government sets the fee schedules, but physicians
are free to charge above the scheduled fee or they may directly bill the government
when there is no patient charge. Prescription pharmaceuticals have a patient co-payment,
and out-of-pocket payments account for 19% of health expenditures. Physicians
in public outpatient hospitals are either salaried or paid on a per-session basis.
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AUSTRIA
Austria
is home to 8,131,000 people, slightly less than the number living in the state
of Georgia (8,186,453). The infant mortality rate is 4.5 deaths/1,000 live births,
better than in the US (6.82/1000). Life expectancy at birth is 74.52 years for
men and 80.99 years for women, about the same as in the US. Per capita GDP is
$23,400, about 69% of the US's.
Of this, Austria
spends 8% ($1872 per capita) on health care, about 43% of what the US spends,
with better or comparable results.
The country
has universal access to health care through a compulsory system of social insurance.
A system of private insurance also exists.
Private
doctors with contracts to the social insurance funds are paid on a fee-for-service
system with expenditure limits based on the case and per doctor per pay period.
Hospital physicians are salaried. Approximately 50% of the health expenditures
are funded by progressive payroll taxes, 25% are financed by non-specific taxes,
and the rest is funded directly out-of-pocket or through private insurance companies.
The contributions to the health insurance funds (payroll taxes) are split between
employers and employees on a parity basis.
Patients
are free to choose their physicians, as long as the physician has a contract with
the insurer. Benefits and prices of services are fixed in agreements between representatives
of the insured and representatives of the providers. All medical and nursing education
is free.
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BELGIUM
Belgium
is home to 10.241,000 people, just 300,000 or so more than live in Michigan (9,938,444).
Its infant mortality rate is 4.76 per 1,000 live births, and its life expectancy
at birth is 74.47 years for men and 81.3 years for women. Infant mortality is
significantly better than in the US; life expectancy, somewhat better.
Belgium's
per capita GDP is $23,900, of which it spends 8.8% on health care, or $2103 per
capita, less than half of what the US spends to get - it's becoming a familiar
refrain - better results. The Belgian health care system is funded primarily through
sickness funds. Belgium's health insurance program operates at four distinct levels:
the central government, national associations, federations of local societies,
and local mutual aid societies. The general attitude in Belgium is that the pluralism
of the health insurance system stimulates each local fund to work hard to attract
and satisfy its members.
Patients have their
free choice of any doctor. Primary care physicians are paid via fee-for-service,
directly from the patient, or partially reimbursed, except with low-income patients
who are exempt from pay. They are reimbursed with a negotiated fee, but extra
billing is allowed. Specialists are paid via fee-for-service and are not restricted
to hospitals.
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BRITAIN
The
population of Britain is 59,511,000, bigger than any single state but smaller
than the population of the American Midwest, which the latest census counts as
over 64,000,000. The infant mortality rate in the United Kingdom is 5.63 per 1,000
live births, and life expectancy at birth is 74.97 years for men and 80.49 years
for women. This is a little better than the US on all counts.
6.8%
of Britain's per capita GDP of $21,800 goes towards health expenditures. Doing
the math, this is $1482 per person per year, only 34% of what the US spends. (According
to their plans, they will spend more in the near future.) Yet, the results are
comparable.
Britain has had a National Health
Service (NHS) since 1948. The British government is a purchaser and provider of
health care and retains responsibility for legislation and general policy matters.
The government decides on an annual budget for the NHS, which is administered
by the NHS executive, regional, and district health authorities. The NHS is funded
by general taxation and national insurance contributions and accounts for 88%
of health expenditures. Complementary private insurance, which involves both for-profit
and not-for-profit insurers, covers 12% of the population and accounts for 4%
of health expenditures.
Physicians are paid
directly by the government via salary, capitation, and fee-for-service. GP's act
as gatekeepers. Private providers set their own fee-for-service rates but are
not generally reimbursed by the public system. Specialists may supplement their
salary by treating private patients. Hospitals are mainly semi-autonomous, self-governing
public trusts that contract with groups of purchasers on a long-term basis.
The
British government has announced a huge funding increase for the NHS. Specifically,
it will receive 6.2% more in funding every year until 2004. Current plans to improve
the system over the next five years include hiring 7,500 more specialists, 2,000
GP's and 20,000 nurses; providing 7,000 more acute beds in existing hospitals
and building 100 new hospitals by 2010; demanding that GPs see a patient within
48 hours of an appointment; and finally, guaranteeing that patients wait no more
than three months for their first outpatient appointment with a specialist and
no more than six months after that appointment for an operation.
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CANADA
Canada's
population size of 31,281,000 is roughly the same as that of California (33,871,648).
Its infant mortality rate is 5.08 per 1,000 live births, better than our 6.82.
Life expectancy at birth is 76.02 years for men and 83 years for women, a little
less than two years better for men and a little more than two years better for
women, compared to the US.
Canada's per capita
GDP is $23,300, $10,600 less than in the US. They spend 9.3% of that on health
care, or $2167 per person per year. This is almost exactly half of what we spend,
per person, every year, for the by-now familiar better results.
National
health insurance had been discussed in Canada at the federal level since 1919,
but no real action was taken until 1944. Today, Canada's health system is characterized
by single-payer national health insurance, and the federal government requires
that insurance cover "all medically necessary services."
National
health insurance (Medicare) is a public program administered by the provinces
and overseen by the federal government. Medicare is funded by general tax revenues.
Federal contributions are tied to population and provincial economic conditions,
and provinces pay the remainder. Medicare accounts for 72% of health expenditures.
In addition, the majority of Canadians have supplemental private insurance coverage
through group plans, which extends the range of insured services, such as dental
care, rehabilitation, prescription drugs, and private care nursing. The private
sector (private insurance and out-of-pocket payments) accounts for 28% of health
expenditures.
Most physicians in Canada are
in private practice and accept fee-for-service Medicare payment rates set by the
government. Provincial medical associations negotiate insured fee-for-service
schedules with provincial health ministries. Some physicians set their own rates
but are not reimbursed by the public system. Hospitals are mainly non-profit and
operate under global institution-specific or regional budgets with some fee-for-service
payment. Less than 5% of all Canadian hospitals are privately owned.
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CUBA
Cuba's
population of 11,142,000 is very close to Ohio's 11,353,140. The infant mortality
rate in Cuba is 7.51 deaths/1,000 live births, comparable to our 6.82/1000 but
definitely worse. In Cuba, life expectancy at birth for a man is 73.84 years,
again slightly worse than our 74.24; for a woman, it is 78.73 years, more than
a year off our 79.9. For the first time in this booklet, we have an example of
a country with worse results than ours, though not as much worse as ours are worse
than the best.
Cuba has a per capita GDP of
$1,700. This is about 5%, or 1/20 of the amount of wealth available to the US.
It does not even make sense to ask what percentage of Cuba's GDP is spent on health
care because, if they spent every penny of it on health care, they would only
spend 39% of the $4373 per person that the US spends. In terms of available wealth,
Cuba is clearly not in the same league as the United States. All Cubans receive
free medical care, period. Personal finances or social standing is not a factor.
There is one doctor for every 200 Cubans. The emphasis in the Cuban system is
on preventive care for children, with the result that 9 out of ten one-year-olds
are fully vaccinated. While services are available, there is a shortage of medications,
including basic medications such as insulin, asprin, and antibiotics. Medical
equipment, especially the newer and more expensive variety, is also quite scarce.
The
Cuban economy has diminished overall by a third since 1989. The United States
Trading With the Enemy Act, mandating restrictions on the import of medications
and equipment to Cuba for more than thirty years before the collapse of the Soviet
Union, is still in effect. As a consequence, prescriptions, even for items we
would consider simple over-the-counter drugs, are rationed. The government response
has been to emphasize priority of care for the most vulnerable groups in the society;
children, women with children, and the elderly. In 1997, Cuba ranked second among
developing nations according to the Human Poverty Index, which weighs factors
such as safe water, malnutrition, literacy and life expectancy, in addition to
access to health care.
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DENMARK
Denmark,
a small country, is home to 5,336,000 people, almost as many as live in the state
of Wisconsin (5,363,675). Denmark's infant mortality rate is 5.11 per 1,000 live
births, and its life expectancy at birth is 73.95 years for men; 79.27 years for
women. The infant mortality rate is better than ours, but here, men live a quarter
of a year longer, and women, half a year.
Denmark's
GDP per capita is $23,800. Approximately 8.3% of GDP is spent on health care,
making their expenses about $1975, or 45% of what we spend. The results are approximately
the same, although Denmark spends half as much as we do.
Denmark
has had a single-payer national health system since 1961. The Danish health care
system is funded by progressive income taxes, and is publicly administered. Hospitals
are run by the 14 counties and the City of Copenhagen. Physicians who work with
the hospitals receive salaries, which are determined by negotiation between government
and doctor's unions. GP's are 40% per capita fee, and 60% fee-for-service. Specialists
are mostly fee-for-service. All medical and nursing education is free.
There
is strong incentive for patients to choose a GP in their immediate area of residence.
GP's will then make referrals to specialists. There are no co-pays for physician
or hospital care, but patients do pay a share of drug costs - usually between
25 and 50%. Private insurance, held by approximately 27% of the population, is
used mainly for medications and dental expenses.
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FINLAND
Finland,
with its population of 5,167,486, is a little smaller than Denmark. The state
of approximately the same size is Arizona, with its population of 5,130,632. Finland
has an infant mortality rate of 3.82 deaths/1,000 live births, way better than
ours. For 100 babies that die here, only 56 do in Finland. Life expectancy at
birth is 73.74 years for men and 81.2 years for women. For whatever reason, men
live longer in the US, and women, longer in Finland. Finland is a fairly typical
European conutry, with a per capita GDP of $21,000. The country spends only 6.9%
of its GDP on health care, only $1449 per person. This is a mere 33% of what the
US spends. Turning this number upside down, the US spends three times as much
for - let's hear the chorus - about the same results.
In
1964, national health insurance was enacted in Finland. The Finnish health system
is primarily funded (80%) by general tax revenues collected by the local and national
governments. The basic administrative levels in Finland are divided into communes
and municipalities. The local authorities in Finland number 445, averaging about
10,000 people each.
GP's practice mostly in
health centers. They are salaried, but many are paid fee-for-service for overtime.
Hospital physicians, who must be specialists, are salaried.
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FRANCE
France
is has a population similar to Britain's; 59,330,000 in this case. This is comparable
to the Western region of the US, which the Census Bureau measures at 63,197,932.
France has an infant mortality rate of 4.51 deaths/1,000 live births, better than
Britain and considerably better than the US. France's life expectancy at birth
is 74.85 years for men and 82.89 years for women; better by half a year for men
and by three years for women.
The per capita
GDP of France is toward the high end for European countries at $23,300, and 9.4%
of it is spent on health care. This gives a relatively high $2190 per capita,
or just slightly more than half of US expenses. The country has had a national
health insurance system since 1928, but universal coverage did not occur until
1978. The French health care system is primarily funded by Sickness Insurance
Funds (SIF's), which are autonomous, not-for-profit, government-regulated bodies
with national headquarters and regional networks. They are financed by compulsory
payroll contributions (13% of wage), of employers (70% of contributions) and employees
(30% of contributions). SIF's cover 99% of the population and account for 75%
of health expenditures. The 3 main SIF's (CNAMTS, MSA, and CANAM) cover about
95% of the population, and the remaining 5% of the insured population are covered
under 11 smaller schemes. The remainder of health expenditures is covered by the
central government, by patients' out-of-pocket payments, and by Mutual Insurance
Funds (MIF's), which provide supplemental and voluntary private insurance to cover
cost-sharing arrangements and extra billings. MIF's cover 80% of the population
and account for 6% of health expenditures. The major public authority in the French
health system is the Ministry of Health. Below this are 21 regional health offices
that regulate each of the 95 provinces.
Patients
are free to choose their providers and have no limits on the number of services
covered. GP's have no formal gatekeeper function. Private physicians are paid
on a fee-for-service basis and patients subsequently receive partial or full reimbursement
from their health insurance funds. The average charge for an office visit to a
GP and a specialist are $18 and $25, respectively. Private hospitals are profit-making
and non-profit making, usually with fee-for-service physicians. Public hospitals
employ salaried physicians, who make up 1/3 of all GP's in France. All medical
and nursing education is free.
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GERMANY
Germany
is home to approximately 82,797,000, nearly 1/3 of the U.S. population. To match
this, we will have to take the Midwest's 64,392,776 and add in Texas' 20,851,820,
to come up with a total of 85,244,596. Germany's infant mortality rate is 4.77
deaths/1,000 live births, and its life expectancy at birth is 74.3 years for men
and 80.75 years for women. The life expectancy is barely better for men, and almost
a year better for women. The infant mortality is clearly better than the US rate
of 6.82.
The per capita GDP of Germany is $22,700.
Today, Germany spends 10.6% of its GDP on health care, resulting in a per capita
expense of $2406. This means that Germany actually spends 55% as much as the US,
a figure that by now might seem surprisingly high. This high figure means that
the US could realistically cut health care costs in half, if only we could figure
out how.
In 1883, Germany was the first country
to establish the foundations of a national health insurance system and has since
gradually expanded coverage to over 92% of the population. Everyone in Germany
is eligible for health insurance, and individuals above a determined income level
have the right to obtain private coverage. The German health care system is predominantly
characterized by Sickness Insurance Funds (SIF's), which are funded by compulsory
payroll contributions (14% of wage), equally shared by employers and employees.
SIF's cover 92% of the population and account for 81% of health expenditures.
The rest of the population (the affluent, self-employed, and civil servants) is
covered by private insurance, which is based on voluntary, individual contributions.
Private insurance accounts for 8% of health expenditures.
GP's
have no formal gatekeeper function. Private physicians, over half of which are
specialists, are paid on a fee-for-service basis. Representatives of the sickness
funds negotiate with the regional associations of physicians to determine aggregate
payments. Physicians who work in hospitals are full-time salaried specialists,
whose work is entirely devoted to in-patients. All medical and nursing education
is free.
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ISRAEL
Israel's
population is a mere 5,842,000, which would put it in between the state of Tennessee
(5,689,283) and the state of Washington (5,894,121). The infant mortality rate
is 7.9 deaths/1,000 live births, a full point worse than in the US. Life expectancy
at birth is, however, better than in the US, at 76.57 years for men (2-1/2 years
better) and, for women, 80.67 years (about 2/3 of a year better.). Overall, this
would have to rate as comparable results for their health system.
Israel's
GDP per capita is low compared to most European countries, at $18,300. In 1997,
they spent 8.4% of their GDP on health care. This figure is out of date, so let's
assume current expenditure is nearer 9%, just to be reasonable. This would make
the expenditure about $1650, or about 38% of our $4373.
The
National Health Insurance Law, which went into effect in January of 1995, gives
the state the responsibility of providing health services for all residents. Four
organizations which had, prior to this law, provided health insurance to a majority
of residents are incorporated into the new system. The law says that these organizations
cannot now bar any applicant on any ground, including age or state of health.
The organizations are required to supply all the services included in a comprehensive
list determined by the law. In addition to the obvious hospitalization and medicines,
also included are perventive dental care for children, medical treatment of alcohol
and drug abuse problems, and paramedical services such as occupational and physical
therapy.
Financing is complicated. First, there
are compulsory premiums collected directly from the insured, set at 3.1% of the
portion of the salary equal to half the average wage, and 4.8% of the balance
of the salary, up to four times the average wage. the government may increase
the services covered on the comprehensive list, but may not reduce them unless
specifically authorized by a standing committee of the Knesset. Health care organizations
may offer supplementary insurance for services not included in the comprehensive
package. The ministry of Health supervises the equality and availability of medical
services supplied by the health-care organizations, and runs a public complaints
office.
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JAPAN
Japan
has a population of 126,550,000 people. The American South, as defined by the
Census Department, is just over 100 million, so we would have to add California's
33,871,648 to that region to make up a comparable section of the US. The infant
mortality rate in Japan is 3.91 deaths/1,000 live births, far superior to our
6.82. In Japan, life expectancy at birth is at 77.51 years for men and 84.05 years
for women, 3-1/4 and 4 years longer, respectively, than in the US.
Japan's
per capita GDP is $23,400, so the US is clearly the wealthier country, by over
$10,000 per person. Approximately 7.4% of Japan's GDP is spent on health care,
making the per capita expense $1732, or just under 40% of what the US spends.
The pattern of equal or better results in health care for about half of the US
cost is by now becoming crystal clear. Japan's current system of universal health
care was initiated in 1958. The Employee's Health Insurance System is financed
by compulsory payroll contributions (8% of wages), equally shared by employers
and employees, and covers employees and their dependents. The National Health
Insurance System covers the self-employed, pensioners, their dependents, and members
of the same occupation. The local governments act as insurers, and premiums are
calculated on the basis of income, the number of individuals in the insured household,
and assets. Premiums account for 57% of health expenditures. The federal government
contributes 24% to medical care expenditures and local governments contribute
7%. About 80% of hospitals and 94% of private clinics are privately owned and
operated. While some public not-for-profit hospitals exist, investor-owned for-profit
hospitals are prohibited in Japan. Patients are free to choose their ambulatory
care physicians, who are reimbursed on the basis of a negotiated, uniform fee-for-service
schedule. Physicians have no formal gatekeeper function. Due to the combination
of medical and pharmaceutical practices a large part of a physician's income is
derived from prescriptions. Hospital physicians have fixed salaries.
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NETHERLANDS
The
Netherlands has a population of 15,892,000, which is approximately the same as
the number of people who live in the state of Florida (15,982,378).The infant
mortality rate is 4.42 deaths/1,000 live births, and life expectancy is at 75.4
years for men and 81.28 years for women. Across the board, the numbers are better
than those for the US.
Per capita GDP is normal
for a European country at $23,100. The Netherlands spend 8.7% of GDP on health
care, or $2010 per person per year, 46% of the US's $4373.
The
health care system in the Netherlands is very similar to that in Belgium; health
care is primarily financed by employer-employee social insurance. Health care
is provided by private not-for-profit institutions, and the compulsory health
insurance system is financed through sickness funds. 70% of the population is
in the public health care system. 30% of the population (mostly civil servants
and high-income groups) has private insurance, because they are not eligible for
social health insurance. There are currently plans to convert the entire system
to a tax-based one.
Most primary care physicians
are in a solo office practice (54%) or practice in small groups. Reimbursement
is by capitation for "public patients" (2/3) and via fee-for-service
(1/3). Specialists are salaried and are restricted to hospitals.
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NEW
ZEALAND
New Zealand's population is 3,820,000,
which puts it between Oklahoma (3,450,654) and South Carolina (4,012,012) in size..
The infant mortality rate is 6.39 deaths/1,000 live births and life expectancy
is at 74.85 years for men and 80.93 years for women. This is slightly better than
in the US, but essentially similar.
New Zealand's
GDP per capita is a rather low $17,400. They spend only 8.1% of it, or $1410 on
health care. This is 32%, or less than 1/3, of US expenditures, and yet the results
are as good or better.
In 1941, New Zealand
achieved universal coverage and was the first country with a free-market economy
to do so. Radical health sector restructuring occurred in 1993, which introduced
a set of market-oriented ideas. However, the new system performed poorly and was
thus again restructured 3 years later The health system is funded through taxation
and administered by a national purchasing agent, the Health Funding Authority
(HFA). Health care is provided by 23 hospital provider organizations (Hospital
and Health Services), GP's (most of whom are grouped as Independent Practitioner
Associations, IPA's), and other noncrown providers of child care, disability support
services, etc. These parties compete for the provision of health services. Public
funding accounts for 76% of health expenditures. Complementary, non-profit, private
insurance, on the other hand, covers about 1/3 of the population and accounts
for 7% of health expenditures. It is most commonly used to cover cost-sharing
requirements, elective surgery in private hospitals, and specialist outpatient
consultations. New Zealand's government is a purchaser and provider of health
care and retains the responsibility for legislation and general policy matters.
Health
care is free for children, and all patients have their free choice of GP. Out-of-pocket
payments account for 17% of health expenditures. GP's act as gatekeepers and are
independent, self-employed providers. They are paid via fee-for-service, partial
government subsidy, and negotiated contracts with HFA through IPA's. The payment
system is currently moving from fee-for-service to capitation. Private insurance
and out-of-pocket contributions pay the remainder. Hospitals are mostly semiautonomous,
government-owned companies that contract with the HFA. Specialists are commonly
salaried, but may supplement their salaries through treatment of private patients.
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NORWAY
Norway
is home to 4,481,000 people, a few more than live in the state of Louisiana (4,468,976).
The infant mortality rate in Norway is 3.98 per 1,000 live births, and life expectancy
at birth is at 75.73 years for men and 81.77 years for women. As usual, the results
are all better than in the US.
The per
capita GDP of Norway is on the high side for a European country at $25,100, within
$8800 of the US figure. They spend 9.4% of that, or $2360 per person, about 54%
of the US expenditure. It is high for a European country, but still close to half
of our expenses.
Norway has had a single-payer
national health insurance system since 1966. The National Insurance Act guaranteed
citizens universal access to all forms of medical care. Norway's health system
is funded by progressive income tax, and from block grants from central government,
with 8.9% of GDP being spent on health care, and in 1998 the per capita expense
was $2,425-US.
Patients are free to choose
their own physician and hospital, however, registration with local GP's who act
as gatekeeper, will begin in 2001. Patients are responsible for co-pays for some
physician visits, approximately $15. Patients are also responsible for co-pays
for prescription drugs, up to $216 per year. Once that level of expense has been
reached, prescription drugs are covered at 100%. All hospital care is covered
at 100%.
Hospital physicians have fixed salaries.
GP's have either fixed salaries or fee-for-service agreements. All medical and
nursing education is free.
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SPAIN
Spain's
population of 39,997,000 makes it closely comparable to California (33,871,648)
plus the state of Washington (5,894,121). Infant mortality is 4.99 deaths/1,000
live births. Life expectancy at birth is 75.32 years for men and 82.49 years for
women. All three figures are significantly improved over the US figures; that
is, more than a whole point better for infant mortality and more than a whole
year better for life expectancy for both sexes. The per capita GDP is $17,300,
of which Spain spends 7.3% on health care; $1263, or an amazing 29% of the $4363
spent in the US. This is a full 71% less cost, for significantly better results.
How do they do it?
The country has had a comprehensive,
single-payer national health service since 1978. The Constitution of 1978 explicitly
affirms everyone's right to health care.
The
Spanish health care system is funded by payroll taxes through the National Institute
of Health program (INSALUD), which in 1984 was 75% financed by employers and 25%
financed by employees. Those with higher incomes have the option of obtaining
private medical care. Public hospitals are run by one of the provinces or municipalities.
The INSALUD program operates a large network of hospitals and ambulatory care
clinics. Hospital physicians are on full-time salaries. All medical and nursing
education is free.
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SWEDEN
Sweden
has a population of 8,873,000, making it larger than New Jersey (8,414,350) and
smaller than Michigan (9,938,444). The country has an infant mortality rate of
3.49 per 1,000 live births and a life expectancy at birth of 76.95 years for men
and 82.37 years for women. This is better by 3 points and by 2-1/2 years for each
sex, or distinctly superior to the US records.
Sweden's
per capita GDP is normal for a European country at $20,700, as is the 8 to 9%
of GDP it has spent on health care during the 1990s. Using the higher figure of
9% gives a dollar figure of $1863. The fact that this is 43%, or way less than
half of the US cost, has lost its power to surprise.
Sweden
has had its current universal health care system since 1962. Tuition for medical
and nursing education is free, and students generally take loans for living expenses
of around $9,000-US per year.
The Swedish health
care system is financed by both incomes and patient fees. County councils own
and operate hospitals, employ physicians and run the majority of general practices
and outpatient facilities. Other physicians work in private practice and are paid
by the counties on a fee-for-service basis.
Co-pays,
which were mandated in 1970, are capped, with limits on how much a person is required
to contribute annually. For example, patients over age 16 pay $9 per day for hospitalization.
The maximum individual expense for hospital and physician services is approximately
$108 per year. The maximum individual expense for prescription drugs is $156 per
year. Once these sums are met, care is covered at 100%.
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UNITED
STATES
The United States has a population size
of about 281,421,906 - more than twice the number of people who live in Japan.
Its infant mortality rate is 6.82 per 1,000 live births, and life expectancy at
birth is 74.24 years for men and 79.9 years for women. Per capita GDP is $33,900,
of which 12.9%, or $4373 per person per year, is spent on health care.
Today,
the U.S. is overwhelmingly dominated by the private health care market (20% HMO's,
50% other managed care, 30% other), and the role of government is generally kept
to a minimum. Its pluralistic health care system also includes Medicare (government
insurance for the elderly), Medicaid (government insurance for the poor and disabled),
voluntary health agencies, and enterprises with health functions. The U.S. health
system is financed primarily through private insurance agencies. As such, over
60% of all U.S. health expenditures come from private sources (i.e., personal
income).
Primary care physicians act as gatekeepers,
and are generally reimbursed by a fee-for-service system. The patient frequently
pays for primary care service out of pocket. Specialists are not restricted to
hospitals and are paid via fee-for-service.
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Conclusions
Above,
the US has not been compared to countries such as India, where the infant mortality
rate is around 60 per thousand and the life expectancy is 62.5 years for men;
64.3 for women. In Kenya, the infant mortality is a little better than India's,
and the life expectancy decidedly worse - less than 50 for both men and women
- because of traditional tropical diseases combined with AIDS and compounded with
poverty. These countries do not have anything like the resources of the US, so
we can't learn much from that comparison.
The
US, while the wealthiest country in the study, has been compared with similar
countries (except for Cuba), to illustrate what is possible here in the US.
By
now, if the examples haven't convinced you that the United States is wasting about
half the money it puts into health care, nothing will. People who try to claim
that "free-market competition" is the best way to control health care
costs just don't know the facts. The fact is, the US Medicare program has overhead
administrative costs of less than 5%, while the private insurance companies have
overhead costs in the 20-25% range. This clearly demonstrates that the efficiency
of the marketplace is in this case just a myth.
However,
simple inefficiency in administration is inadequate to explain how so much money
is wasted in American health care. First off, let's define "waste" in
this context. If you don't need to spend money in some particular manner to get
good health care, then money so spent is wasted.
Private
insurance companies, in addition to overhead expenses, must have profits, so some
of the money paid for health care goes to these profits. They also have executive
salaries and perks that would not be tolerated in a government agency, salaries
and perks that are not needed (as we see in the example of numerous other countries)
for purposes of delivering health care, and so this money is also wasted.
But
it is not just profits and perks. Private insurance insists on reviewing every
procedure, and contesting a great many of them. This takes time, personnel, and
money, and is a way of delaying health care, not delivering it. Doctor's offices
and hospitals are compelled to carry a matching staff to fill out forms, make
and return phone calls. Doctors and nurses find much of their time consumed in
the same process. All of this costs money, and this money is wasted, as the administrative
conflict is almost entirely unnecessary.
Medicare
has no money in its budget to lobby Congress or pay for TV ads during election
campaigns. The private health insurance industry uses millions this way. If it
does not pay for health care, it is wasted money.
The
other big institutional offender is the drug industry. Americans pay the highest
prices in the world for drugs. Drug companies use the money for advertising, lobbying,
campaign funds for pet politicians, executive salaries and perks, and still have
enough left over to report a high rate of profit. This rate of profit is either
splendid or obscene, depending on your view of stock profits and prices; it is
certainly not necessary to pay the costs of developing and producing drugs. All
of the extras above the cost of producing drugs and a reasonable rate of profit
is wasted, compared to the practices of most other countries. It is no secret
that when a national health system which buys all the drugs from all the manufacturers
for even a small country negotiates prices with drug manufacturers, the result
is reasonable drug prices. It is also no secret that when drug companies deal
with dozens or hundreds of insurance companies and with the millions of atomized
individuals paying out of pocket, ridiculously high drug prices result. That's
why Americans increasingly buy drugs from Canada.
The
drug companies and the insurance companies are tied together by the laws of this
country and the politicians who make the laws. The companies see a stream of money,
in the Social Security and Medicare programs, which they wish to turn into profits
and perks for themselves. They are literally paying politicians to make this happen,
and running commercials to enhance the myth of "competition in a free market"
to get us to accept it.
The collusion among
insurance companies, drug companies, and politicians to put their profits above
our health care is vulnerable on the political side of this triangle, if we refuse
to let them buy our votes.
If we vote against
every incumbent who takes money from these industries, we have a beginning. If
we decide to organize to vote against every incumbent who is not vigorously in
favor of universal health care, we have a path to follow. This may sometimes mean
voting out a half-decent candidate and getting a worse one in, and having to vote
that one out in the next election cycle. It's not a smooth path or a perfect outcome,
but we have to demand universal health care in a language politicians understand.
Once
they understand they have to give us universal health care or they are out, we
win. If we settle for expressions of sympathy and gestures of support without
real action, we lose. The choices are ours.
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"Rats and roaches live by competition
under the laws of supply and demand. It is the privilege of human beings to live
under the laws of justice and mercy." - Wendell Berry
michuhcan.tripod.com/in_every_other_country.txt
