Discussion Post

International Systems in Healthcare

Learning Objectives

By the end of this chapter, you should be able to:

1. Identify points of comparison among global healthcare systems and explain the measure- ment challenges associated with each.

2. Discuss aspects of healthcare systems in various countries.

3. Analyze the U.S. healthcare system as it compares to the national health systems of other countries.

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Chapter 11

The study and comparison of healthcare systems around the world increase in importance and relevancy as the world grows smaller, travel becomes more common, and the concept of global integration comes closer to reality. Comparisons of cross-national healthcare systems can

• inform public policy, • draw attention to areas where nations can improve, • yield benchmarks for high performance, • suggest opportunities for cross-national learning to improve health systems, and • assess the consequences of reform through regular repetition of international surveys.

The healthcare systems of all developed countries face similar unrelenting problems: increasing reliance on healthcare because of aging populations, rising costs, inadequate quality, and dispar- ity in access to care. Patients are demanding more information, choice, and control over their individual care. More choice leads to a need for increased transparency and necessitates a change in the relationships between governments, organizations, and patients. Ironically, as the United States moves toward more government involvement in healthcare, European countries are intro- ducing market incentives and competition into their healthcare systems. The call for reform is not only being heard in the United States, but is increasingly heard throughout Europe as well.

The majority of systems in the developed world use some form of mixed private- and publicly- funded coverage and delivery. Until the passage of the 2010 Patient Protection and Affordable Care Act (PPACA, or Affordable Care Act), the United States was one of the few Organisation for Economic Co-operation and Development (OECD) countries without some form of universal coverage. Most OECD countries offer coverage for 95% to 100% of their citizens. Chile, Mexico, and Turkey are working toward universal coverage and now provide public coverage for up to 80% of their residents, compared with 26.4% public coverage in the United States (Organisation for Economic Co-operation and Development [OECD], 2011).

Health reform in the United States is still shifting, which makes it difficult to assess long term results, but in 2009, prior to the passage of the Affordable Care Act (ACA), more than 35% of the total health expenditure in the United States came from private health insurance, as Figure 11.1 shows. In 2015, that number had not changed much, and was at approximately 33% (CMS, 2017). In addition, as of 2016, approximately two-thirds of the population was insured through private health plans (Barnett & Berchick, 2017).

The ACA mandated coverage for those over age 65 and low-income individuals and families. States that took advantage of the Medicaid expansion between 2014 and 2016 increased the num- ber of insured further. As of July 2017, seven more states are in the process of expanding Medicaid via the CMS waiver program, which will cover an additional 30 to 45 million uninsured indi- viduals. The mandated coverage represented a major expansion of government regulation of U.S. healthcare, the most significant since Medicare and Medicaid were instituted in 1965 (Vicini, Stempel, & Biskupic, 2012). Although the ACA retained private and employee-based insurance as important components of the system, government funding has taken up more of the burden for healthcare. See the Appendix for a list of the law’s key provisions.

Studies that compare international systems of healthcare are useful for a full understanding of the U.S. system. They help demonstrate how the quality, sophistication, and delivery of health- care in the United States compare to those of other systems. Such studies can expose gaps, illu- minate strengths, indicate where improvement is needed, and answer questions such as: Is too

Chapter 11

much healthcare focused in a single area? Too little? And at what cost? When changes are made, follow-up studies can assess whether the changes have made a diff erence. In many respects, stud- ies of this nature led to the passage of the ACA.

Th e World Health Organization (WHO), an intergovernmental organization related to the United Nations, is responsible for

• providing leadership on global health matters, • shaping the health research agenda, • setting norms and standards, • articulating evidence-based policy options, • providing technical support to countries, and • monitoring and assessing health trends.

Other lesser known but important groups that regularly contribute to the establishment of world health standards include the World Medical Association (WMA), OECD, and numerous medical societies that regularly collaborate to publish treatment guidelines in areas such as cardiology, diabetes, and cancer.

Th is chapter focuses on the U.S. healthcare system in its present state relative to other systems around the world.

Figure 11.1: Private health insurance, population covered, and share in total health expenditure, 2009

The U.S. spends 35% of all private insurance on health, but less than 65% of its total popu- lation is covered by private insurance.

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Bases for Comparison Between Countries Chapter 11

U N D E R T H E M I C R O S C O P E

Models of Health Financing

Four healthcare systems are in use today: the Beveridge Model, the Bismarck Model, the National Health Insurance Model, and the Out-of-Pocket Model.

1. With the Beveridge Model healthcare is provided and financed by the government through tax payments. Most of the system is owned and controlled by the government, which allows for greater control of costs. Great Britain, Spain, most of Scandinavia, and New Zealand are exam- ples of countries employing the Beveridge Model.

2. The Bismarck Model uses an insurance system—the insurers are called “sickness funds”— usually financed jointly by employers and employees through payroll deductions. Bismarck-type health insurance plans must cover everybody, and insurers do not profit. Germany, France, Belgium, the Netherlands, Japan, Switzerland, and, to some extent Latin America, utilize the Bismarck approach.

3. The National Health Insurance Model includes aspects of both the Beveridge and Bismarck models. Like them, it relies on private-sector providers, but costs are covered by the state- governed insurance program into which citizens pay. Universal insurance programs using the national health insurance model are less complicated to administer and less expensive than American-style for-profit insurance programs. Founded in Canada, Taiwan and South Korea have adopted this model.

4. The Out-of-Pocket Model is defined by its name and is the model practiced by most of the nations that are too poor or disorganized to provide any kind of mass medical care. Thus the rich get medical care, the poor stay sick or die.

The United States’ healthcare system contains elements of all four models (Physicians for a National Health Program, 2010).

11.1 Bases for Comparison Between Countries A number of indices are used to compare healthcare systems, none of which is perfect. Safe envi- ronments, adequate diet, adequate healthcare, sufficient education, adequate financial resources, nurturing families and communities all contribute to having a high quality of life and health. Comparing strengths and weaknesses of different systems, number of medical personnel, wait times for accessing service, available resources, and specific disease prevalence are useful mea- sures for assessing the quality of healthcare. Lifestyle behaviors, like obesity, that lead to chronic illness and disability are a measure of how a country is preparing for future healthcare burdens.

Costs per-person-per-year, infant mortality, and life expectancy are the most often used mea- surements when comparing national healthcare systems. Values for infant mortality and life expectancy are easy to obtain and on the surface can be broad indicators of a healthcare sys- tem’s effectiveness. Increasing values for these two measures are often used to determine if the quality of healthcare is improving. However, cultural and environmental factors can affect these measurements. Genetic diversity and environmental factors (air, water, and food quality), can have unexpected effects on health outcomes (Jackson, 2004). The validity of the data collection process, poor standardization of data assessment from country to country, and the availability of different data sets make it difficult to compare country systems one-to-one.

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Measuring Costs

Studies of healthcare systems usually include a cost component, measured either as total spend- ing as a percent of gross domestic product (GDP) or as per capita spending. GDP is defined as the monetary value of all finished goods and services produced within a country in a year. Other cost measures include:

• Per-person spending per year • Average annual real growth • Spending by source of funding (private versus public) • Hospital spending per discharge • Pharmaceutical spending • Use of imaging equipment

Percent of GDP and per capita are the most frequently used measures when considering overall healthcare spending. Expenditures on human resources, medicines, and medical equipment add more detail about real cost than conventional comparisons of expenditures because growth in spending has been linked to the rising use of prescription drugs and medical innovations and treatments (Cutler, 2004).

It is important that these expenditures are adjusted for cost of living differences of the different countries. However, cost differences between nations can be confounded by differences in their demographics and sources of funding.

The individuals and organizations who prepare studies comparing international healthcare systems are struggling to find common denominators for these comparisons. There are large international variations in the cost of equipment and services; thus the same level of expendi- tures may purchase different quantities of real resources in different countries. For example, national income level determines the wages of doctors, nurses, and other healthcare personnel, while the prices for items such as patented drugs and medical equipment are negotiated in the global market.

The primary and most reliable assessor of international healthcare systems is the OECD, which has been providing comparative reports since the early 1990s. Currently the OECD tracks and reports annual data on more than 1,200 health system measures across 34 industrialized countries, which vary in population and economic size, per capita GDP, distribution of income, geography, and culture and values. These disparities reflect what resources are available and how they are used. OECD assessments range from population health status and nonmedical determinants of health to healthcare resources and utilization. Their reports use a standard- ized score that is the mean of the OECD score for all countries on any indicator. The relative distance from the OECD average for each indicator indicates the country’s standing compared to the mean.

Nearly all countries are struggling with how to contain the cost of healthcare while maintaining or improving quality and access. Annual comparisons among healthcare systems may provide valuable lessons in meeting these difficult objectives, since structural differences in the provision of healthcare, such as the mix of resources and demographics, can be linked to differences in performance (Baily & Garber, 1997).

Next, this chapter discusses several key indicators used to compare healthcare systems:

Bases for Comparison Between Countries Chapter 11

• Infant mortality • Life expectancy • Obesity • Quality of care

Cultural differences, variations in the measurements used to define quality, differences in defi- nitions of terms, and interpretation of findings make it difficult to draw firm conclusions from these comparisons. However, measurement and comparison to other national systems and past assessments form the basis of continual improvement of healthcare services in every country.

Infant Mortality

Many factors affect the calculation of a country’s infant mortality rate. An important difference is classification. Several of the countries that this chapter discusses—Japan, Sweden, Norway, The Netherlands, and France—classify babies who are not viable at birth and who die quickly as still- births. The United States, however, records these births as live births. Some experts suggest that infant mortality in the United States is overstated by 40%, merely as a result of these nonviable births that were recorded as live births (Gibson, Culhane, Saunders, Webb, & Greenspan, 2000). Three definitions used for reporting birth mortality are listed here:

• Infant mortality—The number of deaths in the first year of life per one thousand live births.

• Neonatal mortality—The number of deaths in the first 28 days of life per one thousand live births.

• Perinatal mortality—The number of deaths in the first week after birth, plus fetal deaths after 28 weeks of gestation, or fetuses that exceed a weight of one thousand grams (2 pounds, 3.3 ounces).

Other factors also affect comparisons of infant mortality. American doctors often go to great lengths to save newborns with poor survival chances, and these infants frequently go on to live with serious and expensive medical problems. Lifestyle factors such as obesity and use of tobacco, alcohol, and illicit drugs have a strong impact on infant mortality (Liu, Moon, Sulvetta, & Chawla, 1992; O’Neill & O’Neill, 2008).

Teenage mothers are more likely to have preterm (babies born alive before 37 weeks of normal gestation or 38 weeks) or low-birth-weight babies, and both of these conditions are linked to infant mortality. Teenage births are very high in the United States, 2.8 times higher than in Canada and 7.0 times higher than in Sweden and Japan. Moreover, in the United States, mortality rates for infants born to unwed mothers are about twice as high as for infants born to married women (Liu et al. 1992). The preterm-related infant mortality rate and the teen birth rate are also considerably higher for U.S. blacks than for whites (O’Neill & O’Neill, 2008).

Infants born to women under the age of 15 suffer a much higher mortality rate (16.4 out of every 1,000 births) compared with babies born to older women (6.8 per 1,000 births) (Mathews & MacDorman, 2013). When birth weight is taken into consideration, the U.S. infant mortality rate equals that of Canada (5.5 per 1,000) (O’Neill & O’Neill, 2008). If the United States had the same distribution of gestational ages as Sweden, its recorded infant mortality rate would drop by 33%, tying it with France as the fifth-lowest among 21 developed countries (MacDorman & Mathews, 2009). Gestational age of an infant is based on the number of weeks that have passed since a pregnant woman’s last normal menstrual period. This usually ranges from 36 to 41 weeks. A high

Bases for Comparison Between Countries Chapter 11

rate of teen pregnancy, the subsequent high rates of infant deaths due to preterm births, and low birth weights contribute to the higher U.S. infant mortality rate.

Life Expectancy

Life expectancy as a measure of a country’s quality of care is problematic for infant mortal- ity. Higher infant deaths affect data for overall life expectancy. Life expectancy measures are intertwined with infant mortality, confounded by external factors, and not identically applied across all countries. Measurement errors along with lifestyle and cultural influences that affect the infant mortality measure are directly imported into life expectancy calculations.

Measures of mortality by cause depend on the accuracy of recording and the correct coding of a cause of death. While some countries have sophisticated systems for recording specific causes (e.g., cancer, heart disease, stroke), other countries may record some causes as “unspecified.” The recording of complications and adverse events from hospital errors is not always documented in every country, making this comparison dif- ficult. The type of care provided by public or private sectors may be counted differently when measuring procedures, resources, and activities related to adverse events.

The OECD has attempted to adjust for errors produced by life expectancy data by using potential years of life lost (PYLL), which uses a reference age, commonly set at 75 years. The difference between the actual age of death and the reference age is the PYLL value. However, PYLL is also strongly influenced by infant mortality. The method of calculat- ing PYLL varies from author to author and country to country. PYLL is not consistently used by OECD, nor does it adjust this data for external factors such as obesity and other lifestyle factors. Thus the mediating disease and not the underlying external cause will be recorded as the cause of death. For instance, a person with AIDS, which is the underlying cause of death, may actually die from respiratory complications.

Recently, attention has turned to the use of amenable mortality as an indicator of the relative effectiveness of health systems. Amenable mortality is the number of deaths considered ame- nable (responsive) to timely and effective healthcare before a certain age, usually 75. This mea- sure captures the potential impact of healthcare on improving health (Desai, Nolte, Karanikolos, Khoshaba, & McKee, 2011; Nolte & McKee, 2011).

Obesity

Obesity is fast reaching epidemic proportions globally, and its impact on the cost of healthcare is enormous as a result of its association with a long list of diseases, including hypertension, diabe- tes, stroke, and coronary artery disease (Marcus, 2002). The World Health Organization defines obesity as a body mass index greater than or equal to 30.

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▲▲ How might the life expectancy of this group of Japanese children compare to that of a group of children growing up in the United States?

Bases for Comparison Between Countries Chapter 11

Japan has the lowest number of obese citizens: 3.1% of women and 4.4% of men (OECD, 2017c). Other countries are catching up with the United States, but as of 2015 it was ranked first in obe- sity among OECD nations, at 38.2%. In 2015, the obesity rate in Mexico was 32.4%, placing it in second behind the U.S. According to the OECD, “more than one in two adults and nearly one in six children are overweight or obese in OECD countries” (OECD, 2017c, p. 2).

More than 40 million children under the age of five were considered overweight (having a body mass index greater than or equal to 25) in 2011 (WHO, 2013b). Overweight and obese children have a higher risk for health problems, including cardiovascular disease, diabetes, and asthma. These children are also more likely to remain overweight or obese into adulthood. The World Health Organization estimates that obesity is responsible for 2% to 8% of healthcare costs in Europe and as much as 11% to 13% of healthcare spending in some regions. “For the first time in human history, the number of overweight people rivals the number of underfed people” (Worldwatch Institute, 2000, para. 1).

Table 11.1: Obesity rates for select OECD countries, 2015

Country Percent of total population that is obese

United Statesb 38.2

Canadab 25.8

Germanyb 23.6

United Kingdomb 26.9

Japanb 3.7

Francea 15.3

The Netherlandsa 12.8

Norwaya 12.0

Swedena 12.3

Switzerlanda 10.3

Spaina 16.7

Mexicob 32.4

OECD median 19.5

a Self-reported data b Measured data

Source: Organisation for Economic Co-operation and Development (OECD). (2017). Obesity update 2017. Retrieved from http://www.oecd.org/health/health-systems/Obesity-Update-2017.pdf

Quality of Care

Although it is a difficult concept to define, especially when used to measure differences in global healthcare systems, a common indicator of a system’s strengths and weaknesses is the measure- ment of quality of care. The United States Institute of Medicine defines quality as “the degree to which health services for individuals and populations increase the likelihood of desired health outcomes and are consistent with current professional knowledge” (Institute of Medicine, 1990, p. 117).

Bases for Comparison Between Countries Chapter 11

In addition to effectiveness, researchers have identified 14 other dimensions of per- formance for healthcare systems: accept- ability, accessibility, appropriateness, care environment and amenities, competence or capability, continuity, expenditure or cost, efficiency, equity, governance, patient- centeredness (patient-focused) or respon- siveness, safety, sustainability, and timeliness (Arah, Westert, Hurst, & Klazinga, 2006).

Quality of care can be evaluated by either objective standards (data, professional agreement, or provider satisfaction) or by subjective assessment (patient satisfaction surveys and testimonials). Quality is eval- uated for populations and for subgroups within populations. However, levels of health (poor, fair, good, very good, and excellent) are subjective terms to rate an individual’s level of satisfaction with his or her healthcare.

More objective measures, like the individual’s score on the Health Utility Index (HUI) can be used to show more detailed comparisons. The HUI is based on an individual’s overall functional health on eight attributes: vision, hearing, speech, mobility (ability to get around), dexterity of hands and fingers, memory and thinking, emotion, and pain and discomfort. The score is a num- ber that reflects the value an individual holds for a specific health state (Horsman, Furlong, Feeny, & Torrance, 2003).

Other Objective Indices to Measure Healthcare

Along with cost, mortality data, life expectancy, and quality of care, statisticians use other mea- sures to assess and compare healthcare systems. These measures may include

• the number of practicing physicians per 1,000 people, • the number of physicians per capita, • wait time for procedures, • resource availability, • specific disease prevalence, and • the number of inpatient versus outpatient procedures.

Many of these measures derive from population or patient surveys. For a single measure, such as cancer screening, some countries might report results from surveys, while other countries report screening rates from national screening programs.

Other measures, such as complications and adverse events resulting from hospital care (for exam- ple, accidental punctures or lacerations), can be counted only if they are recorded on the hospi- tal’s discharge abstract. For example, Canadian hospital standards for recording and reporting complications resulting from hospital stays are public knowledge, and the Canadian Institute for Health Information (CIHI) regularly reviews the quality of abstract coding (Canadian Institute for Health Information, 2011). However, information to assess the quality of recording and

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▲▲ Quality of care is a common indicator of a healthcare sys- tem’s strengths and weaknesses.

A Sampling of International Healthcare Systems Chapter 11

reporting from hospitals is not always available in other countries. What is included or excluded for measures of healthcare activities and resources often depends on a country’s organization of healthcare delivery, as this chapter discusses in the following section.

11.2 A Sampling of International Healthcare Systems The United States shares the same pressures as most European countries to a different extent— the introduction of market incentives and competition in healthcare systems. The urge for more transparency, public disclosure, and the focus on quality output is increasing everywhere. Table 11.2 presents recent data for a select set of OECD countries, including the United States. As noted in the OECD report, health spending in the United States is largely “unchanged from 2009 and 2010 but by far the highest share in the OECD” (2013a, para. 1). In 2016, the United States spent approximately $9,892 per capita (or average spent per person; OECD, 2017b).

Table 11.2: Healthcare expenditures for select OECD countries, 2016

Country

per capita (in U.S. $)a

% GDPb

% of expenditure paid by the government

% of expenditure paid by the private sectorc

United States 9,892 17.2 49.1 50.9

Canada 4,753 10.6 70.3 29.7

Germany 5,551 11.4 84.6 15.4

United Kingdom 4,192 9.7 79.2 20.8

Japan 4,519 10.9 84.1 15.9

France 4,600 11.0 78.8 21.2

The Netherlands 5,385 10.5 80.8 19.2

Norway 6,647 10.5 85.2 14.8

Sweden 5,488 11.0 83.9 16.1

Switzerland 7,919 12.4 63.6 36.4

Spain 3,248 9.0 70.6 29.4

Mexico 1,080 5.8 51.7 48.3

OECD median 4,003 9.0 72.5 27.5

a Includes both public and private expenditure. Data expressed in U.S. dollars adjusted for purchasing power parities (PPP), which provides a means of comparing spending between countries on a common base. b Includes both current and capital expenditure. c Includes both out-of-pocket and private expenditure.

Source: Organisation for Economic Co-operation and Development (OECD) . (2017). Health expenditure and financing: Health expenditure indicators. OECD Health Statistics (database). http://dx.doi.org/10.1787/data-00349-en

Space limitations prevent a review of the health system for every country in the world, but the following introductions may be considered a representative sample of 11 countries’ healthcare systems. In addition to basic information about the systems, these discussions include a) infant mortality, b) life expectancy, c) obesity, and d) quality of care. (Most in-depth comparisons of data related to other indicators, such as medical resources, are considered in Section 11.3.)

A Sampling of International Healthcare Systems Chapter 11

Canada

Sharing a border, culture, and language, the United States and Canada are often compared, and their respective healthcare systems are no exception. Canada and the United States had similar healthcare systems in the early 1960s, but now have a different mix of funding mechanisms.

Since the late 1960s, Canada’s system has used a universal, single-payer model that is publicly funded and administered, but delivers care primarily through private providers. Table 11. 2 indi- cates that the government covers about 70.3% of expenditures compared with 49.1% in the United States. The Canadian federal government sets national standards and provides financial support, but each of the provincial and territorial governments are responsible for administering the sys- tem for hospital and medical services in their region (“Comparing International,” 2009).

The Canada Health Act of 1984 required that all persons be fully insured, without premiums, deductibles, or co-payments for all medically necessary hospital care (covers about 91% of hospital expenditures) and physician care (covers about 99% of total physician services). Ophthalmology and dental services are paid for out of pocket (“Comparison,” n.d.).

Private insurance exists but is not supposed to cover the same benefits as the public plan, which is called Medicare. Until 2005, the Canada Health Act restricted the use of private services to replace any publicly provided “core” medical services (Makarenko, 2005). This changed, however, in 2005 as the result of a suit brought by a physician (Jacques Chaoulli) and his patient (Geroge Zeliotis) against the canton of Quebec, contesting this prohibition. In their decision, the Supreme Court of Canada ruled that the prohibition violated Quebecers’ right to life and security of person under the Quebec Charter because the restriction resulted in long wait times for medical service with no recourse for patients.

Since then, private facilities have increased services for core provisions and made up 29.7% of total health expenditures in 2016. Plans differ by province and territory and some include private insurers. Some provinces cover prescriptions and even provide dental coverage for children to age 14, but private insurance can be purchased to cover any gaps in the coverage such as dental care, outpatient prescription drugs, and rehabilitation services. Canadians have free choice of doctors and hospitals, and doctors’ groups and province officials negotiate billing rates.

Of the 190 countries ranked by the World Health Organization in 2000, the Canadian healthcare system was number 30 based on a series of performance indicators, distribution of healthcare, and the responsiveness and financing of healthcare services. (See http://www.photius.com/rank- ings/healthranks.html.) This was WHO’s first and last attempt at ranking the world’s healthcare systems. WHO no longer produces such a ranking system, citing the complexity of the task as too formidable. The rankings were based on a percentage mix of values for disability-adjusted life expectancy, speed of service, protection of privacy, quality of amenities, and cost of care.

As noted in Table 11.2, OECD data shows that the Canadian government spent $4,753 per capita on healthcare in 2016, about 10.6% of its GDP (2017b).

Eighty-eight percent of Canadians report having good health, and 22% are dissatisfied with the quality of their healthcare system (probably as a result of long wait times for access) (Blizzard, 2003; OECD, 2011). As federal funding has declined, leading to a shortage of healthcare workers, wait times have increased. Of those individuals waiting to see a specialist, 57% waited more than a month. Wait times to go from an internist to a specialist and from a specialist’s surgery decision to actual surgery are significantly greater in Canada than in the United States.

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Canadians have a slightly higher cancer mortality rate than in the United States, where the detec- tion and treatment of cancer is better. Preventive screening services, e.g., mammograms, PAP smears, PSA testing, and colonoscopies are applied less often in Canada than in the United States. The United States is a much greater user of testing and has many more units of imaging machines per capita compared with Canada (O’Neill & O’Neill, 2008).

Guyatt et al. (2007) identified 38 studies comparing populations of patients in Canada and the United States that assessed rates of cancer, coronary artery disease, chronic illnesses, and surgi- cal procedures. Of 10 studies that included extensive statistical adjustment and enrolled broad populations, five favored Canada, two favored the United States, and three showed equivalent or mixed results.

Germany

Germany has the oldest universal healthcare system with both national and private insurance. It is characterized by a predominance of mandatory Social Health Insurance (SHI), covering about

90% of the population, with many competing sickness funds and a private and public mix of providers covering the remaining 10%.

In 2004 the Statutory Health Insurance Modernization Act pushed for reforms to bring more competition into the healthcare system and a dimension of quality in competition between sickness funds. In all there are 250 private, nonprofit and 52 for-profit health insurance programs. Patients have free choice of doctors and hospitals offering mostly free service with small co-payments. Comprehensive cov- erage includes basic dental and long-term care (Busse & Riesberg, 2004; “Comparing International,” 2009). Employers pay about 8% of an employee’s gross income to nonprofit health funds. Those earning over $75,000 are eligible to purchase private insurance. Almost 100% of physicians and 90% of hospital funds are derived from the government, which covers 76.5% of the country’s health expenditures.

Germany is ranked number 25 by the World Health Organization. OECD (2017b) data indicate that it spends about the same amount as Canada for healthcare ($5,551 per capita, or 11.4% of GDP).

Seventy-three percent of Germans report having good health (WHO, 2013) and 38% are optimistic about the healthcare system. But despite having short wait times (less than four weeks for elec- tive surgery), patients complain about not getting prompt, effective

treatment and the high cost. They also express concern that their healthcare professionals are working too many hours to be effective (Sell, 2009; Wyke, 2009).

At the same time, the German primary care physicians expressed the highest level of dissatisfac- tion with their healthcare system. A large percentage (82%) of German primary care physicians considered “fundamental changes” or even “complete” reform to be necessary, and 73% of those surveyed complained of deterioration in medical care caused by changed conditions in the last three years. Physicians’ self-assessed workload was the highest in Germany with a median of 51 hours per week and seeing a median 250 patients per week, which is at least twice as high as almost all other countries. German physicians, in addition, have the greatest number of patient

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▲▲ What can American policymakers learn from the German healthcare system?

A Sampling of International Healthcare Systems Chapter 11

contacts but the shortest period of contact. The time per patient contact is lowest in Germany with a median of 9.1 minutes, compared with 22.5 minutes in the United States (Koch, Miksch, Schürmann, Joos, & Sawicki, 2011).

United Kingdom (UK)

The second country most often compared with the United States with respect to healthcare is the United Kingdom (UK). The UK’s National Health Service (NHS), founded in 1948, is a free, comprehensive healthcare service available to legal UK residents. It is funded mainly through general taxation, with additional national insurance contributed by employers and employees (van Kemenade, 2007).

Patients choose one general practitioner and have a wide choice of hospitals. Patients do not receive bills, as the government pays for most care at the point of service, the exception being some eye and dental exams. Some doctors accept private insurance. Prescriptions are free for disabled, elderly, and pregnant UK residents; others have co-pays. Co-payments are required for long-term and private care, dental care, pharmaceuticals, and ophthalmic services. Social ser- vices are funded through local taxation.

The NHS can be divided into two sections: One deals with strategy, policy, and managerial issues, and the other deals with all clinical aspects of care (i.e., primary, secondary, and ter- tiary) (“National Health Service,” n.d.). The UK system is moving towards local decision-making, breaking barriers between primary and secondary care, and enabling greater patient choice.

Budgets are set every three years as part of the planning process for general public expenditures. Private health insurance premiums are risk-related and vary between group policies and indi- vidual policies. The majority of the private health insurance policies are group policies purchased by employers. General practitioners act as gatekeepers in the system, and a referral is required for specialist services. Secondary care is provided in general NHS trusts (National Health Service not- for-profit, public sector corporations created to transfer healthcare decision-making from central government to local organization and communities) and small-scale community hospitals.

WHO ranked the UK as number 18. Healthcare spending in the United Kingdom for 2016 came to $4,192 per capita, or 9.7% of GDP (OECD, 2017b), and government spending on healthcare is 79.2%.

Seventy-six percent of UK adults report having good health, and only 15% are unhappy with the healthcare system. Except for pharmaceutical expenses, UK patients have almost zero out-of- pocket expenses for their medical care.

The biggest challenge facing the UK system is long wait times to see a specialist or have elective surgery. In 2000 the government set waiting time to a maximum of 18 weeks from referral to treatment for elective care. By 2008 approximately 96% of all patients were treated within that time period (OECD, 2011, p.144).

Japan

Japan was the first nation in Asia to create a comprehensive social insurance program. About 50% of Japanese citizens receive their health insurance through an employer-based health insur- ance program and the other half (the self-employed, elderly, students, and the poor) through the national healthcare program. Everyone has similar benefits. Insurers are all not-for-profit and do

A Sampling of International Healthcare Systems Chapter 11

not compete; they all cover the same services and drugs for the same price. The Japanese health ministry tightly controls these fixed prices and negotiates rates every two years with the health- care industry. Employees pay the cost of premiums (between 20% to 30% of care costs up to a certain price level after which full coverage is provided by the insurer) and in addition, employers pay an average of 4% of the employee’s salary. Insurers must cover everyone and are not allowed to deny insurance claims.

Patients have free choice and access to all health institutions and doctors. Most doctors and almost all hospitals are in the private sector. Services covered include inpatient and outpa- tient care, home care, dental, prescriptions, long-term care, home nursing for the elderly, and prosthetics. Cash benefits are given for childbirth. Costs that are not covered include routine physical exams, some dental services, and over-the-counter drugs. National Health Insurance participants pay co-payments (as much as 30%) for care and prescription drugs (“Comparing International,” 2009).

“Japan’s socialized healthcare system stands out as one of the best performing when it comes to healthcare,” said Francesca Colombo, a senior health policy analyst at OECD (“Comparing International,” 2009, para. 25). Japan has kept costs low through negotiations between the gov- ernment and providers. Out-of-pocket expenses for patients are minimal (2.4% of household consumption).

WHO rankings place the Japanese healthcare system as the tenth best in the world. Healthcare expenditures in Japan are $4,519 per capita, or 10.9% of GDP (OECD, 2017b), and government expenditures account for just over 84.1 % of total health spending.

Thirty-three percent of Japanese adults and 20% of those over 65 say they are in good health, and there is a high degree of satisfaction among the population. The Japanese also have low rates of adult and childhood diabetes, breast and prostate cancer, and heart disease. In addition, less alcohol is consumed in Japan than in the average OECD country.

France

The World Health Organization rankings for 2000 place France as having the number one health- care system in the world. The government offers universal healthcare predominantly funded through a national social insurance system, taxed-based financing, and voluntary health insur- ance. A specific tax called “generalized social contribution” is based on every source of income and profit, and this contribution finances 34% of healthcare. All legal residents are covered by public health insurance and are automatically affiliated with a health insurance scheme based on their professional status and place of residence. Those covered have neither the choice to opt out nor the choice of insurer (Chevreul, Durand-Zaleski, Bahrami, Hernández-Quevedo, & Mladovsky, 2010; Sandier, Paris, & Polton, 2004). Almost 90% have supplemental insurance. Patients may choose from a wide selection of general practitioners and specialists, and they may choose any hospital (private or public) without referral or limit on the number of consultations.

Health policy and regulation of the healthcare system is determined by the state (parliament, gov- ernment, and various ministries), statutory health insurance companies, and, to a lesser extent, local communities (Sandier, Paris, & Polton, 2004). Parliament and the Ministry of Health are responsible for health policy and healthcare expenditures. All doctor and hospital fees are set by the government. Prescriptions are paid by the government along with a patient co-payment. For most services, patients make direct payments to the service provider, and they are reimbursed by the statutory health insurance system and by the complementary insurer.

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The Juppé reform plan of 1996 introduced parliamentary control over the healthcare system and its resources. The reform significantly reinforced the role of the regions, creating new adminis- trative institutions at the regional level. The reform shifted the social insurance model based on wages to one taxed and financed on total income. However, 100% of the French people are cov- ered for the core set of services.

Healthcare expenditures in France are $4,600 per capita or 11.0% of GDP (OECD, 2017b), and 78.8% of healthcare spending is covered by the government.

Thirty-six percent of residents report having good or very good health, but 37% of the French pop- ulation reports having long-standing health problems (Kaiser Permanente International, 2010; OECD, 2012a). France has the lowest overall mortality for heart disease and stroke, but the high- est incidence for cancer, dementia, asthma, and chronic obstructive pulmonary disease (COPD).

The Netherlands

Since the Health Insurance Act of 2006, the Netherlands has had a public–private mix of provi- sion and insurance. Every individual who lives and works in the Netherlands is now required to buy individual private health insurance (at a community-rated premium) from one of 11 approved for-profit or nonprofit insurers who must accept everyone. In addition, employers pay a 6.5% con- tribution on behalf of their employees to a Risk Equalization Fund that allocates risk-adjusted payments to the insurer. All individuals pay 12.6% of their income to finance their healthcare. The Exceptional Medical Expenses Act mandated coverage for long-term care, mental health- care, and mental health-related hospitalization.

Central and local governments are constitutionally responsible for the quality, accessibility, and efficiency of healthcare services, but depend on privately-owned organizations of providers and health insurers. Most people also purchase supplemental private health insurance for services that are not covered, often from the same insurers providing their basic coverage. People under age 18 are insured at no cost. The government provides tax credits for low-income patients and subsidies for participants who are sicker, elderly, or have preexisting conditions.

Standard benefits cover the cost of physician services, hospitalization, maternity care, medical devices, laboratory tests, and prescribed pharmaceuticals. Insurers offer a choice of policies at a range of costs. More costly plans allow patients to choose their health provider and allow reim- bursement by the insurer. The insured also pay a flat-rate premium to their insurer for a policy. Everyone with the same policy pays the same premium. General practitioners act as gatekeepers to care that is more specialized (Kaiser Permanente International, 2010).

WHO places the Dutch healthcare system in the number 17 spot. The Netherlands had one of the highest increases in healthcare expenses of any OECD nation between 2000 and 2010 (5.2%), but still maintains low out-of-pocket expenses for the average citizen. Healthcare expenditures in the Netherlands are $5,385 per capita, the fifth highest after the United States, Norway, Germany, and Switzerland, or 10.5% of GDP (OECD, 2017b).

Sixty percent of healthcare users in the Netherlands assess the system as functioning well, and 78% of Dutch residents report good or very good health. Very low obesity prevalence is reflected by positive lifestyle statistics: less alcohol consumption, less smoking, and more consumption of fruits. However, 33% of the country’s population reports having long-standing health problems.

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Despite the predominance of private ownership, the Dutch government has gained a dominant role in regulating the private insurers (den Exter, Hermans, Dosljak, & Busse, 2004) and has been successful in keeping costs down, while offering a large degree of choice for consumers. Health insurers must compete on premiums, quality of care, and type of policy, since all insured people have the right to choose their own insurer and policy type on a yearly basis, and all insurers are obliged to accept applicants at the same premium rate regardless of age, gender, or health risks (Daley & Gubb, 2013). This improves quality and assures a competitive system.

Norway

Built on the principle of equal access to services for all, Norway has the most nationalized health- care system in the developed world. The healthcare system has three levels that mirror its political tiers: the national/state level, five regions, and 431 municipalities. The state determines national health policy and is responsible for legislation and the allocation of funds. Overall responsibility for the healthcare sector is carried out by the parliament (Stortinget) and the Ministry of Health and Care Services. The provision of specialist healthcare services is the responsibility of the five health regions, while the municipalities are responsible for primary healthcare, including nursing care. Control of flow (a patient’s movement through the care system) is maintained by general practitioners who act as gatekeepers and agents, referring patients to specialists.

All persons who are either residents of or employed in Norway must be insured under the National Insurance Scheme (NIS), which is paid through taxes. Benefits include free public hospital stays and treatment, including drugs. One hundred percent of the population is covered for the core set of services. Although the municipality or the National Insurance covers the major part of the expenses, patients pay part of the cost.

WHO ranks Norway as number 11. Norway’s total healthcare expenditure amounts to $6,647 per capita, or 10.5% of GDP (OECD, 2017b), and 84.9% of healthcare spending is paid by the government.

The majority (77%) of Norwegians say their health is good with relatively few reporting limita- tions in activity because of illness, and Norway has seen a sharp drop in ischemic heart disease (reduced blood supply to the heart), stroke, and cancer mortality rates.

There have been significant increases in coronary angioplasty (procedure to open narrowed arter- ies), cataract surgery, and hip replacement surgery since 2000. But quality of care is improving, as reflected in the decreasing in-hospital fatality rates, the high number of cervical and mammog- raphy screenings, and an increase in the number of childhood vaccinations (OECD, 2012a). The rate of chlamydia infection, a sexually transmitted disease, is the third highest in Europe (483 per 100,000), and the rate of pertussis, or whooping cough, (103.5 per 1,000) is more than double the next highest, Netherlands (43.5 per 100,000), possibly because of inconsistent vaccinations.

Sweden

Sweden offers universal care with equal access to healthcare services under a largely decentralized, taxpayer-funded system. The Swedish system is divided into 290 municipalities, 20 county coun- cils, and four regions. Responsibility for care is shared by the central government (overall health policy), county councils (funding and provision of services), and municipalities (social welfare, nursing and home care, care of older and disabled people). Almost all hospitals and the majority

A Sampling of International Healthcare Systems Chapter 11

of primary care centers are owned by the county councils. County councils are also responsible for dental care for local residents up to the age of 20 (Kaiser Permanente International, 2010).

Sweden allocates more human resources to the health sector than most OECD countries. One hundred percent of Swedes are covered for the core set of services. User charges are levied on visits to medical professionals, for hospitalizations, and for medicines. Most healthcare personnel are public employees.

Sweden faces issues with the funding, quality, and efficiency of its healthcare services, specifi- cally long waiting times for diagnosis and treatment and divergence in quality of care between regions and socioeconomic groups. Sweden has attempted to reform its system by concentrat- ing hospital services (including mergers), regionalizing healthcare services, improving coordi- nated care, increasing choice and competition, privatizing primary care and the pharmacy sector, changing co-payments, and increasing attention to quality and efficiency (Anell, Glenngård, & Merkur, 2012).

In 2005, a healthcare guarantee was introduced to reduce wait time to no more than seven days for an appointment at a community healthcare center, 90 days for an appointment with a spe- cialist, and 90 days for an operation or treatment, once it has been determined the care that is needed. If the waiting time is exceeded, patients are offered care elsewhere. The cost, including any travel costs, is then paid by the patient’s county council.

WHO places Sweden in the number 23 spot. Healthcare expenditures in Sweden are $5,488 per capita, or 11.0% of GDP (OECD, 2017b), and the government covers 83.9% of the healthcare expenditure.

The majority of Swedes are very happy with their system. Regardless of income, the number complaining of unmet medical needs is below the average in the European Union, and 80% say their health is good or very good. Death from heart disease, stroke, and cancer are below average. Although the incidence of adult diabetes is low (4.4%), childhood type 1 diabetes (0-14 years of age) is the second highest (behind Finland) in the European Union.

Switzerland

Switzerland’s healthcare system is more or less classified as a social insurance model, even though it has one of the most priva- tized components in the world, with 36.4% of expenses coming from the private sector (out-of-pocket and supplementary insur- ance) and 63.6% from the government. Since 1996, compulsory health insurance laws direct residents to purchase insurance from nonprofit insurance companies that must not refuse any applicant. Healthcare is financed by this compulsory insurance (29%), taxes (25%), private payments (38%), and other insurance arrangements (8%). Together these pay for outpatient and inpa- tient care, disease prevention, hospital and

Danuta Hyniewska/age footstock/Superstock

▲▲ The World Health Organization headquarters is located in Geneva, Switzerland.

A Sampling of International Healthcare Systems Chapter 11

nursing home care, diagnostic and therapeutic equipment, and approved medicines (Sauter & Stockdale, 2012).

However, the percentage of expenditure from public sources is one of the lowest in the European region (Jacobs & Goddard, 2000). With the revised health insurance law (Loi fédérale sur l’assurance-maladie [LAMal]), all permanent residents are obliged to purchase health insurance policies (Minder, Schoenholzer, & Amiet, 2000). Only insurance providers who comply with the requirements of the health insurance law and are registered with the Federal Office for Social Insurance may provide compulsory health insurance (Minder, Schoenholzer, & Amiet, 2000). Like other countries, healthcare costs were getting out of control and LAMal’s aim was to intro- duce competition into the healthcare system.

WHO ranks Switzerland at number 20. Switzerland currently spends the second most on health- care per capita ($7,919 per person), or the equivalent of 12.4% of the country’s GDP (OECD, 2017b).

Although 82% of adults rate their health as good or very good, a large percentage (34%) say they are dealing with long-standing health problems (OECD, 2012a). But the nation maintains rela- tively low mortality rates for ischemic heart disease, stroke, and cancer, and 95% of all children are vaccinated for childhood diseases.

Spain

Spain now offers universal coverage with free access to healthcare for almost all citizens, funded mainly (99.8%) through taxation. Seventy-three percent of healthcare spending is covered by the government, but individuals may purchase additional coverage for noncovered services and to avoid waiting lists. Out-of-pocket expenses now make up 24% of total costs. Spain’s population shares the costs only for pharmaceuticals and some medical devices (i.e., pacemakers, stents, prosthetics).

In 1986, Spain passed the General Healthcare Act and established the National Health System. The completion of decentralization in 2002 gave the national government the responsibility for promoting coordination and cooperation in the health sector. Seventeen autonomous regions have healthcare planning powers in their own provinces, emphasizing integration of promotion, prevention, and rehabilitation activities (Durán, Lara, & van Waveren, 2006). Coverage is provided for primary care, inpatient and outpatient surgery, emergency care, long-term disease manage- ment, and some drugs. Mental health, dental, and long-term care require additional supplemen- tal insurance or out-of-pocket payments. The coverage rate has reached 99.5% of the population.

However, there are long wait times for care and inaccessible care in some regions. The regional inequalities in the Spanish health system provide an area for further reform. The Catalan Health Service makes use of both public and private providers. Dual (i.e., public and private) coverage is offered for comfort reasons and to avoid waiting lists in case of limited health problems, such as minor surgery.

The World Health Organization ranks the Spanish system as seventh best in the world. Spain spends $3,248 per person on healthcare, or 9.0% of GDP (OECD, 2017b).

Seventy-two percent of Spaniards rate their health as good or very good, higher than the European Union (27 countries) average of 67% (OECD, 2012a). Spain has lower-than-average incident rates

U.S. Healthcare System Compared to Other National Systems Chapter 11

for all types of cancer, except lung, and lower mortality rates for intracranial hemorrhage (ICH), stroke, and breast and prostate cancers.

Mexico

Mexico has a patchwork system made up of public programs, private institutions, and private physicians, but the country is working toward universal coverage. Wealthy Mexicans can pur- chase private insurance to gain access to high-quality, state-of-the-art medicine. The Instituto Mexicano del Seguro Social (IMSS) healthcare program is a tripartite system funded equally by the employee, employer, and the federal government. It is available to all employed citizens and their families.

The Seguro Popular is a free public program set up by the Mexican Federal Government in 2003 for the uninsured and the poor. Coverage is either fully or partially subsidized by the government depending on employment status. Families pay a premium to join, based on their income, and have access to primary care, acute care, ambulatory and hospital care, pregnancy and childbirth care, as well prescription medications. About 20% of the poorest families pay nothing. Everything for children under five years of age is covered.

Over half of the financing for the Mexican healthcare system is funded by out-of-pocket pay- ments from patients, according to the World Health Organization. Government expenditures account for 47.3% of health spending and are financed through general taxes and payment from the employer and employee. The Seguro Popular also is funded by taxes, contributions from the state and federal government, and payments by families as a percentage of income. Participants in Seguro Popular pay nothing at the time of delivery of the service. As of 2011, about half of Mexico’s population did not have health insurance, but the Mexican government is working to change this (”Comparing International,” 2009). Mexico now offers a form of universal coverage for up to 80% of its residents.

WHO places Mexico in the number 61 spot. Public healthcare spending in Mexico is rising, but it still has one of the lowest per-capita expenditures for healthcare among OECD countries—just 5.8% of GDP or about $1,080 per person (OECD, 2017b).

Only 65.5% of adults (42.7% of those over age 65) say they are in good health, below the OECD mean. Interestingly, Mexico has the highest prevalence of adult diabetics (10.8%), above that of the United States, but the second lowest number of children with type 1 diabetes. Obesity is also a problem as the second highest next to the United States.

Mexico scores low in most of OECD healthcare statistics, information which will be analyzed in more detail in the next section. Infant mortality is the highest of all OECD countries, probably because of the high number of low-birth-weight babies. However, Mexico has a relatively low number of deaths from all causes of cancer, ICH, and stroke.

11.3 U.S. Healthcare System Compared to Other National Systems

This section explores the U.S. healthcare system compared with the 11 national systems intro- duced in the previous section. Keep in mind that the United States is in transition to a more universal payer system. Data presented here may reveal more about the system during the imple- mentation and expansion related to ACA, as the future concerning healthcare coverage of U.S.

U.S. Healthcare System Compared to Other National Systems Chapter 11

citizens remains in fl ux. Up-to-date data is diffi cult to obtain, and data quoted in this section is often fi ve to ten years old. Much can change regarding health outcome data at this time. As dis- cussed earlier, diff erent countries use diff erent methods to assess data, and they report it in diff er- ent ways, making comparisons even more diffi cult (Goodman, Gorman, Herrick, & Sade, 2008).

U.S. Healthcare: Who Pays?

Th e issues most often mentioned regarding the U.S. healthcare system include its high cost and the number of uninsured. Th e United States spends about twice as much per person on health- care as its peer countries, and although the U.S. healthcare system remains a mix of private and public spending, public spending is outpacing private. As of 2008, two years prior to the passage of the ACA, public spending accounted for more than 45% of the nation’s health bill, the second highest after Norway. (Th e public share in the United States increased to 47.8% in 2011.) However, private spending in the United States is also far higher than countries that rely on government- payer or social insurance models, and out-of pocket/voluntary expenses in the United States far surpass most all other countries (Squires, 2011). Figure 11.2 breaks down healthcare expenditures for eight countries by funding source.

Figure 11.2: Healthcare expenditure per capita by source of funding for certain OECD countries, 2015: Adjusted for differences in cost of living

The United States far outpaces the world in out-of-pocket spending and ranks third in gov- ernment spending.

Voluntary/out-of-pocket

Government/compulsory

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Sw ed

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10,000

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P P

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$9,892

$7,919

$6,647

$5,551 $5,488 $5,385

$4,753 $4,600 $4,519 $4,192 $4,033

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$4,003

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Source: : Organisation for Economic Co-operation and Development. (2017). Health status. OECD Health Statistics (database). Retrieved from http://stats. oecd.org/index.aspx?DataSetCode=HEALTH_STAT

U.S. Healthcare System Compared to Other National Systems Chapter 11

Medicare provides coverage for those over age 65, and Medicaid covers low-income individuals, children, the disabled, and pregnant women. Children whose families do not qualify for Medicaid but do not make enough to purchase private health insurance are covered under the Children’s Health Insurance Program (CHIP). Veterans are covered under a separate program, the Veterans Health Administration, known as the VA. Th e U.S. government uses money generated from gov- ernment taxes to reimburse providers who care for patients enrolled in Medicare, Medicaid, CHIP, or the VA system. Most Americans, however, are covered either through their employer’s group plan or by privately purchased insurance. Employer-based insurance pays all or most of the cost and employees pay the remainder. Private plans in most states are often underwritten based on age, weight, smoking status, and health history. Patients may pay a direct co-payment to the provider, which may vary by type of insurance. Th e self-employed and those who purchase private insurance on their own must pay their own premiums. Most plans include coverage for inpatient and outpatient hospital care and physician visits but not dental or eye care. Chapter 3 discusses healthcare fi nancing in the United States in detail.

Number of Uninsured

Th e United States is now the only country in the OECD in which a substantial part of the popu- lation is uninsured, but this is changing as the United States moves closer to universal coverage. Estimates vary, but according to the U.S. Census Bureau (2017), the percentage of Americans without insurance was 8.8% in 2016, a substantial drop from almost 16% in 2010. Like unemploy- ment, uninsurance is an often transitory state that can last one year or less (Mills & Bhandari, 2003). Of the 46 million nominally uninsured in 2005, about 12 million were eligible for Medicaid and CHIP (Blue Cross Blue Shield Association, 2005). Surprisingly, at least some of the uninsured may be so by choice; about 17 million of them have household incomes of at least $50,000 and more than half of those have incomes of $75,000 or greater (DeNavas-Walt, Proctor, & Mills, 2004; Kuttner & Rutledge, 2007).

Some data suggest that the uninsured receive fewer preventive and diagnostic services, are likely to delay seeking care, tend to be more severely ill or have an advanced-stage disease when diag- nosed, receive less therapeutic care, and have shorter survival times for chronic conditions (Hadley, 2003; Institute of Medicine, 2009; McDavid, Tucker, Sloggett, & Coleman, 2003). Compared with the residents of other countries, many more Americans say they skip medicines or medical appointments due to cost (Schoen & Doty, 2004; Schoen,Osborn, How, Doty, Peugh, 2009), which may refl ect problems associated with under-insurance or lack of insurance. However, other data suggests that “insurance has a relatively small eff ect on health [because of] uncertainties” about who is uninsured, why, and for how long (Asch et al., 2006, para. 458; Kronick, 2006).

A Research and Development Corporation (RAND) study suggests that once people see a pro- vider, insurance status has little eff ect on receiving care (Asch et al., 2006). More recently, the New England Journal of Medicine published the two-year results of the Oregon project, which reported that individuals covered by Medicaid did not have a signifi cant improvement in physi- cally measured health outcomes compared with a similar group not covered. Healthcare spend- ing in the Medicaid group was also higher and more preventive services were used. Medicaid did help prevent catastrophic medical expenses compared with the uninsured who experienced a ruinous illness or injury (Baicker et al., 2013).

Another issue cited in connection with the uninsured is healthcare-related bankruptcy (Himmelstein, Warren, Th orne, & Woolhandler, 2005). Claims of a connection between a lack of

U.S. Healthcare System Compared to Other National Systems Chapter 11

health coverage and bankruptcy, however, conflict with four decades of economic research. Well- designed economic studies have found no statistical link between bankruptcies and health prob- lems (Fay, Hurst, & White, 2002). Newer studies conducted since the 2008 economic crisis paint a different picture. One study reported that 20% of the U.S. population struggled with healthcare- related bills in 2013 and this is the leading cause of bankruptcy filing (LaMontagne, 2014).

U.S. Healthcare Spending

The United States spends more money than any other country on its citizens’ medical needs, particularly on high-tech services. Although quality of care is good in the United States, it comes at a high price relative to other countries. Yet for all the money we spend on healthcare, WHO’s 2000 rankings placed America’s system at number 37, near the bottom, based on quality of care, equality of care, and distribution of costs.

As presented in the previous sections, economic data for health expenditures are compared using U.S. dollars spent per capita and percent of GDP. Table 11.3 below shows the shifts for each coun- try between the year 2006 and the year 2016.

Table 11.3: Comparison of Healthcare spending in select OECD countries (2006 and 2016)

Country

2006 2016

per capita (in U.S. $)a

% GDP

per capita (in U.S. $)a

% GDPb

United States 6,808 14.7 9,892 17.2

Canada 3,500 9.2 4,753 10.6

Germany 3,522 10.1 5,551 11.3

United Kingdom 2,535 7.4 4,192 9.7

Japan 2,580 7.8 4,519 10.9

France 3,279 10.0 4,600 11.0

The Netherlands 3,370 9.2 5,385 10.5

Norway 4,284 7.9 6,647 10.5

Sweden 3,055 8.2 5,488 11.0

Switzerland 4,408 9.8 7,919 12.4

Spain 2,391 7.8 3,248 9.0

Mexico 772 5.7 1,080 5.8

OECD median — — 4,003 9.0

a Includes both public and private expenditure. Data expressed in U.S. dollars adjusted for purchasing power parities (PPP), which provides a means of comparing spending between countries on a common base. b Includes both current and capital expenditure.

Source: Organisation for Economic Co-operation and Development. (2017). Health expenditure and financing: Health expen- diture indicators. OECD Health Statistics (database). http://dx.doi.org/10.1787/data-00349-en

Healthcare expenditures in the United States increased from 14.7% of the GDP, or $6,808 per per- son, in 2006, to 17.2% of the GDP, or $9,892 per person, in 2016. All countries experienced a rate

U.S. Healthcare System Compared to Other National Systems Chapter 11

of growth over the last ten years. Forces driving these increases varied from country to country, but administrative complexity, the aging of the population, the practice of “defensive medicine” (the practice of ordering questionable diagnostics tests or avoiding treatment of high-risk patients in order to reduce a physician’s exposure to lawsuits), chronic disease burden, healthcare supply and utilization rates, access to care, resource allocation, and the use of technologically advanced equipment and procedures have been cited in the past (Anderson & Squires, 2010). However, the United States has a comparatively young population, average or below-average rates of chronic conditions, and fewer doctor visits and hospitalizations relative to other industrialized countries. So why does it spend more on healthcare than any other country? Muennig and Glied (2010) sug- gest that blame could rest on substantially higher prices and more fragmented delivery that lead to duplication of resources, and extensive use of poorly coordinated specialists.

Interestingly, as the economic crisis of 2009 spread around the globe, growth in health spend- ing slowed or fell in real terms (adjusted for infl ation) in almost all OECD countries. Figure 11.3 compares growth rates of public expenditures with total expenditures. During 2010, the increase in public and total spending on healthcare dropped to zero after almost a decade of 4% to 6% annual increases (OECD, 2012b).

In the United States, the growth rate for healthcare spending averaged about 3.9% from 2009 to 2013. Th is decrease was believed to be the result of structural changes in the health system rather than just part of the economic cycle. It has also been suggested that the slowdown was due to increased market choice, more informed patients, and more competition among the providers

Figure 11.3: Average OECD growth rates in real terms for public spending and total spending on healthcare, 2000 to 2010

Growth in healthcare spending started declining around 2009, a rate of change that coin- cided with a widespread economic crisis.

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2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Public expenditure on health, growth rates

Total expenditure on health, growth rates

Source: Organisation for Economic Co-operation and Development (OECD). (2012). Average OECD health expenditure growth rates in real terms, 2000 to 2010, public and total (Figure 1). http://www.oecd.org/health/healthgrowthinhealthspendinggrindstoahalt.htm from OECD Health Data 2012 http://www.oecd.org/ health/healthdata

U.S. Healthcare System Compared to Other National Systems Chapter 11

(Holahan & McMorrow, 2013). However, due to ACA coverage expansions and the aging of the population, the growth rate has increased, which was 5.8% in 2015 (Zimmerschied, 2017).

Data from a Wall Street Journal article shows the wide geographical disparities in the cost of similar surgeries: A spinal fusion in Philadelphia cost 14 times as much as a similar procedure in Jonesboro, Arkansas. This may provide some insight into why spending on healthcare has slowed from previous years (Radnofsky & Barry, 2013), as dissemination of this type of information helps patients and providers engage in more cost comparisons and bargaining. What happens as a result of this public information is not yet known, but calls for transparency in medicine are on the increase. See the following section, “Under the Microscope,” for more facts about medical costs and advances.

U N D E R T H E M I C R O S C O P E

What If Healthcare Were Treated Like Any Product or Service?

When asked what to do about the rising cost of healthcare, the smartest individuals in the room seem to be at a loss. However, when healthcare is treated like any other market for goods and services absent of third-party payment, evidence indicates prices have a tendency to come down (Goodman & Musgrave, 1992). Cosmetic surgery and corrective vision surgery are paid with out- of-pocket funds, and transparent pricing is the norm for cosmetic and vision procedures (Tu & May, 2007). The real price of cosmetic surgery has declined over the past 15 years, despite substantial technological progress and a six-fold increase in demand (Herrick, 2006). In addition, today’s walk- in clinics in drug stores and shopping malls have achieved greater advances in the use of electronic technology than most physicians’ offices. They post prices, keep electronic medical records (EMRs), and can prescribe electronically, taking advantage of error-reducing software. The latter advances in the use of technology add to efficiency and lower costs.

It remains to be seen, but like other consumer goods and services, healthcare costs may decrease as the consumer begins to drive the healthcare market.

Resources The United States compares more favorably when real resources are measured rather than mon- etary accounts (expenditures). The United States uses fewer physicians, hospital beds, physician consultations, and hospital days than the average OECD country. (See Table 11.4 for use of health resources.) According to the latest OECD data, the United States, along with Canada, Japan, and Mexico, had the least number of physicians per 1,000 population and was below the OECD aver- age of 3.4 physicians. There were 4.0 doctor consultations per capita in the United States, which, while better than Sweden (2.9) and Mexico (2.7), is significantly below the OECD average of 6.7.

The supply of acute-care hospital beds in the United States (2.8 per 1,000 population) was below the OECD average (3.7 per 1,000 population). Canada (2.6), Sweden (2.4), and Mexico (1.5) had fewer beds than the United States, while Japan had the most (13.2).

The average length of hospital stay in the United States in 2014 was 6.1 days, which was shorter than all other countries except Sweden and Mexico (OECD, 2017b). Since 1980, average length of stay has notably decreased in all countries where data are available, including the United States, which has historically had among the shortest stays. The number of all hospital discharges per

U.S. Healthcare System Compared to Other National Systems Chapter 11

1,000 population for the United States was similar to the OECD average of 156. However, even with such short stays, the amount spent per discharge in the United States ($21,063) is far greater than any other country. Table 11.4 shows a comparison of healthcare resources in the chapter’s selected countries.

Table 11.4: Supply and use of health resources in select OECD countries (2010–2015)

Physician supply and use Hospital supply and use

Practicing physicians per 1,000 population

Physician consultations per capita

Acute care hospital beds per 1,000 population

Average LoS all causes (days)

Hospital discharges per 1,000 population

United States 2.6b 4.0c 2.8 6.1c 125.5e

Canada 2.7a 7.7 2.6 7.4c 83.5

Germany 4.1b 10.0 8.1 9.0 255.3

United Kingdom 2.8b 5c 2.6 7.0 131.9

Japan 2.4b 12.7 13.2 29.1 124.1

France 3.4a 6.3 6.1 10.1 183.6c

The Netherlands 3.5a 8.2 — 6.2c 116.5e

Norway 4.4b 4.3c 3.8 6.7 164.4

Sweden 4.2b 2.9 2.4 5.9 153.1

Switzerland 4.3b 3.9c 4.6 8.4 171.5

Spain 3.9b 7.6 3.0 7.3 114.4

Mexico 2.4b 2.7 1.5 4.2 49.9

a Data refer to professionally active, including those practicing physicians, plus other physicians working in the health sector as managers, educators, researchers, etc. b Data refer to practicing physicians defined as those providing care directly to patients c Data refer to 2014 (latest statistics available) d Data refer to average length of stay for acute care e Data refer to 2010 (latest statistics available) LoS = length of stay

Source: Source: Organisation for Economic Co-operation and Development. (2017). Health expenditure and financing: Health expenditure indicators. OECD Health Statistics (database). http://dx.doi.org/10.1787/data-00349-en

Technology One often-cited reason for the high costs of healthcare in the United States is the greater avail- ability, use, and cost of medical technology. (See Chapter 10 for a detailed discussion of health- care and technology.) The United States has more MRI units (39 per million population) and CT units (41 per million population) than any other country except Japan (51.7 and 107.2, respec- tively) and twice the OECD average.

Use of diagnostic imaging was highest in the United States, with more MRI (117.8 per 1,000 population) and CT (245.3 per 1,000 population) exams performed than in any other country for which data was available (OECD, 2017a). According to an analysis by the International Federation

U.S. Healthcare System Compared to Other National Systems Chapter 11

of Health Plans (2009), MRI scan and imag- ing fees in 2009 were highest in the United States ($1,200) among the six countries for which data was available. Several countries other than the United States showed com- paratively high rates of use for imaging and procedures involving sophisticated technol- ogy. Germany in particular had high rates of cardiac catheterization, coronary inter- ventions, and patients undergoing dialysis. But Table 11.5 shows Japan far exceeding other nations in the number of MRI and CT units.

Table 11.5: Diagnostic imaging in OECD countries (2015)

MRI units CT scanners

MRI units per million population

Exams per 1,000 population

CT scanners per million population

Exams per 1,000 population

United States 39.0 117.8 41.0 245.3

Canada 9.5 55.5 15.0 152.8

Germany 33.6 131.3 35.1 143.8

United Kingdom 7.2 52.6a 9.5 79.3a

Japan 51.7 112.3 107.2 230.8

France 12.6 104.8 16.6 197.4

The Netherlands 12.5 51.8 13.8 80.8

Norway NA NA NA NA

Sweden 14.6a NA 20.3a NA

Switzerland 22.0a 69.9a 36.2 100.3a

Spain 15.9 78.3a 18.0 104.9

Mexico 2.4 NA 5.9 NA

OECD average 15.9 64.8 25.7 143.1

a Data include equipment in hospital only or exams in hospital only. CT = Computed Tomography; MRI = Magnetic Resonance Imaging; NA= not available;

Source: Organisation for Economic Co-operation and Development (OECD). (2017). Health at a Glance 2017. Retrieved from http://www.oecd-ilibrary.org/social-issues-migration-health/health-at-a-glance-2017_health_glance-2017-en

Fuse/Thinkstock

▲▲ Diagnostic imaging and other expensive technologies account for a large percentage of healthcare spending in the United States.

U.S. Healthcare System Compared to Other National Systems Chapter 11

Use of prescription drugs Prescription drug use, prices, and spending all appear to be higher in the United States. According to the Commonwealth Fund International Health Policy Survey (2010), adults in the United States were the most likely to take at least one prescription drug regularly (61%) and take at least four prescription drugs regularly (25%). The United States had the highest prescription drug cost per capita ($1,162 in 2015) (OECD, 2017b). Table 11.6 compares pharmaceutical spending in the OECD countries for 2015.

Table 11.6: Pharmaceutical spending in OECD countries (2015)

Pharmaceutical spending

Per capita (U.S. $ purchasing power parity)

Percent of total health spending

United States 1162 12.2

Canada 807 17.5

Germany 766 14.3

United Kingdom 497 12.1

Japan 603a 18.4a

France 668 14.7

The Netherlands 417 7.9

Norway 474 7.7

Sweden 519 19.9

Switzerland 1056 14.0

Spain 572 18.0

Mexico 287 27.2

OECD median 566 16.2

a Data refer to 2014

Source: Organisation for Economic Co-operation and Development. (2017). Health expenditure and financing: Health expen- diture indicators. OECD Health Statistics (database). http://dx.doi.org/10.1787/data-00349-en

The spending rate for prescription drugs has been increasing for the past 15 years in most coun- tries. The United States spends more for brand-name drugs (5% to 117% more) than in other countries. However, as a percent of total healthcare spending, the United States (12.2%) is ranked near the middle of the other countries included in the analysis and is lower than the OECD median (16.2%). Higher U.S. spending on prescription drugs may be reflected in the lower preva- lence of hypertension in the United States relative to Europe (Staessen, Kuznetsova, & Stolarz, 2003; Wolf-Maier et al., 2003). However, death rates from cardiovascular causes remain high relative to other European countries (World Life Expectancy, n.d.-a).

U.S. Healthcare System Compared to Other National Systems Chapter 11

Morbidity and Mortality

In life expectancy, the United States ranks near the bottom of the list with an estimated 78.8 years along with Mexico at 75 years, as Table 11.7 shows.

Table 11.7: Mortality rates per 100,000 population adjusted for age (2012–2015)

Life expectancy at birth

Potential years of life losta

Infant mortality (deaths per 1,000 live births)

Ischemic heart disease

Stroke

All cancers

Diabetes mellitus

Suicide

United States

78.8 3461d 5.8d 113.0d 42d 188d 14.7 13.5d

Canada 81.7c 2389b 4.8 93.0b 36b 207b 11.1 10.9b

Germany 80.7 2062d 3.3 106.0d 48d 201d 11.4 10.8d

United Kingdom

81.0 2319d 3.9 98.0c 53c 222c 4.9 10.5c

Japan 83.9 1667d 2.1d 34.1d 51d 177d 4.3 17.6d

France 82.4 2094c 3.7 39.0c 36c 196c 8.7 14.3c

The Netherlands

81.6 2054 3.3 46.0 50 224 8.9 10.5

Norway 82.4 1770d 2.3 72.0d 47d 198d 8.6 10.5d

Sweden 82.3 1762 2.5 95.0 48 185 9.6 11.7

Switzerland 83.0 1742c 3.9 78.0c 37c 176c 7.6 12.2c

Spain 83.0 1656d 2.7 53.0d 43d 186d 9.8 7.6d

Mexico 75.0 4635d 12.5 144.0d 58d 115d 89.5 5.5d

OECD average

80.6 2297 3.9 112.0 65 204 N/Ae 12.1

a all causes, years loss per 100,000; 0-69 years of age b 2012 c 2013 d 2014 e N/A – not available

Sources: Organisation for Economic Co-operation and Development. (2017). Health expenditure and financing: Health expenditure indicators. OECD Health Statistics (database). http://dx.doi.org/10.1787/data-00349-en

Eight of the 34 countries (Chile, Czech Republic, Estonia, Hungary, Mexico, Poland, Slovak Republic, and Turkey) had lower life expectancy than the United States (OECD, 2017b). Even with advancements in technology and increased coverage for the underinsured and uninsured, it hasn’t improved in the past six years. In fact, a study of amenable mortality before age 75, conducted by Nolte and McKee in 2011, found that among 16 countries the United States had the highest rate of deaths (95.5 per 100,000) from conditions that could have been prevented or treated successfully (called amenable deaths), followed by the UK (82.5 per 100,000) and Denmark (80.1 per 100,000). France had the lowest rate (44 per 100,000), followed by Australia (56.9 per 100,000) and Italy

U.S. Healthcare System Compared to Other National Systems Chapter 11

(59.9 per 100,000). From 1997-98 to 2006-07, all countries in the survey experienced a decrease in amenable deaths, a 30% decline in 10 of the 16 countries (Cohn, 2011). Th e United States had the lowest rate of decline (20.5%) as seen in Figure 11.4.

Experts have suggested that the diff erences in rates can be explained by the fact that the United States has a much higher prevalence of nine of 10 serious conditions, including cancer, heart disease, and stroke in its population over age 50 (Nolte & McKee, 2012; Th orpe, Howard, & Galactionova, 2007).

PYLL (potential years of life lost), which is supposedly a more equitable measure than death rates, gives more weight to deaths that occur among younger people. Th e United States ranks near the

Figure 11.4: The United States lags other countries in mortality amenable to healthcare

The United States shows higher death rates than the other countries represented. However, some experts argue that a comparison of potential years of life lost (PYLL) is a more accu- rate assessment than a comparison of death rates.

f11.04_HCA305.ai

FRA (France)

JPN (Japan)

SWE (Sweden)

NOR (Norway)

NLD (The Netherlands)

DEU (Germany)

GBR (United Kingdom)

USA (United States)

0 50

Deaths per 100,000 population

100 150

76

81

61

88

61

99

64

97

66

106

76

127

83

120

96

55

1997–1998

2006–2007

Source: Adapted from Nolte, E. and McKee M. (2011, November). Variations in American mortality—Trends in 16 High-income Nations. Health Policy, 103(1), p. 47–52. Reprinted with permission of Elsevier.

U.S. Healthcare System Compared to Other National Systems Chapter 11

bottom using this measure. The same is true for infant mortality and death from coronary artery disease. (See Table 11.7 for mortality rates.)

As the chapter previously discussed, such low ranking in mortality statistics may be attributed to a number of causes beside poor quality of healthcare. Because of differences in lifestyle choices such as diet, exercise, and smoking, life expectancy at birth varies enormously among racial and ethnic groups, from state to state, and across U.S. counties (Hitti, 2006; Kung, Hoyert, Xu, & Murphy, 2008; Manchester & Topoleski, 2008; Murray et al., 2006). In addition, U.S. infant mor- tality varies by a factor of two or three to one (2 or 3:1) across racial and ethnic groups, across the largest cities, and across the states for reasons apparently having little to do with healthcare (Haynatzka et al., 2002; Mathews & MacDorman, 2007). Definitions of what is classified a live birth may also play a role in the low U.S. international ranking (Müller, Drack, Schindler, & Bucher, 2005; Sepkowitz, 1995).

Low birth weight is associated with less likelihood of survival (Eberstadt, 1995). The United States has a high incidence of low-birth-weight babies and thus a higher rate of infant mortality. High rates of premature mortality for men in the United States can be attributed to higher than aver- age rates of traffic accidents, suicides, and homicides (World Life Expectancy, n.d.-b). Table 11.8 shows the high rates of mortality in the United States due to low birth weight, drug use, traffic accidents, and violence.

Table 11.8: Mortality rates per 100,000 population adjusted for age (2014)

Alcohol

Drug use

Influenza and pneumonia

Traffic accidents

Suicides

Violence

United States 2.9 7.0 10.6 10.0 12.4 5.6

Canada 3.0 2.3 9.7 5.9 10.0 9.0

Germany 4.6 1.3 9.9 3.9 9.6 0.7

United Kingdom 1.7 3.8 23.4 3.0 6.3 0.6

Japan 0.5 0.4 32.1 3.3 18.8 0.3

France 4.4 1.1 10.0 5.6 12.8 1.1

The Netherlands 1.1 0.6 17.4 3.5 8.5 0.9

Norway 3.8 4.0 18.3 2.9 9.3 0.6

Sweden 3.7 2.5 8.0 2.4 11.4 1.0

Switzerland 2.5 1.8 6.4 3.6 9.6 0.6

Spain 0.6 0.9 9.4 3.7 5.2 0.6

Mexico 4.2 1.0 19.9 12.8 4.2 27.4

mean of above 2.75 2.2 14.5 5.0 9.84 3.4

Sources: World Life Expectancy. (2014). Selected causes. LeDuc Media. Retrieved from http://www.worldlifeexpectancy.com/

Some older studies have suggested that some outcome differences may be traced to treatment strategies. While half of all diabetics have high blood pressure, it is controlled in 36% of patients in the United States, compared with only 9% in Canada (Joffres, Hamet, MacLean, L’italien, & Fodor, 2001). Our aggressive and more costly approach to treatment may improve survival rates

U.S. Healthcare System Compared to Other National Systems Chapter 11

at least regarding stroke, which is below the OECD average (see Table 11.7 for mortality rates of stroke). The United States scores near the average for cancer and diabetes death rates, but is among the highest for death from ischemic heart disease. Still the aggressive treatment offered to cardiac patients in the United States apparently improves functioning, at least compared with Canadian patients (Kaul et al., 2004).

Fewer health- and disability-related problems occur among spinal cord injury patients in the United States than among Canadian and British patients (McColl, Charlifue, Glass, Savic, & Meehan, 2002). The rate of adverse events in U.S. hospitals is about half that in England, Australia, and New Zealand (Baker et al., 2004).

Comparing selected cancer outcomes, WHO data indicates that the United States ranks near the bottom (worse) for deaths from prostate, colorectal, and cervical cancers, but ranks slightly bet- ter for deaths from breast cancer. In the United States fewer people contract vaccine-preventable pertussis, measles, and hepatitis B (Mattke, Kelley, Scherer, Hurst, & Gil Laptera, 2006). More seniors get flu vaccinations (70%), but fewer children get vaccinations (<50%) (Yoo, 2011).

Wait Times

If it ranks lower in many areas on the global healthcare scale, the U.S. system does much better than many of the top-ranked health systems when it comes to wait times, one of the most con- tentious issues with European and Canadian healthcare. For example, in Norway average wait times for specialist visits or surgical/medical treatment have risen from 72 days in 2007 to 77 days in 2011. This is the time from the day the hospital receives the referral to the start of treatment (Siciliani, Borowitz, & Moran, 2013).

The wait times in Canada are also long. For knee-replacement surgery, a median wait time of 12 weeks was reported for Canada versus five weeks in the United States. In 2002–2004, dialysis patients waited 16 days for access to hemodialysis in the United States, 20 days in Europe, and 62 days in Canada (Mendelssohn et al., 2006). In England, nearly 1.8 million people are waiting to enter hospitals or for outpatient treatments at any given time (Isbell, 2012 ).

Adverse aspects of long wait times include loss of productivity and wages, a negative economic impact on family members with additional caring responsibilities, and an additional cost of care. Most patients in the English National Health Service are treated within 18 weeks, with penal- ties imposed on providers who extend this time (Findlay, 2013). Despite this improvement, UK residents would like further reductions in wait times. In a study comparing barriers to care in Canada and the United States, Canadians were more likely to cite long waiting times as the pri- mary barrier, while Americans were more likely to cite cost (Sanmartin et al., 2006).

Finland calculates that the cost of waiting (sickness benefits, medicines, and social welfare expenses) can exceed the cost of treatment (Hurst & Siciliani, 2003). Short waits for cataract surgery produce better outcomes; prompt coronary artery bypass reduces mortality; and rapid hip replacement reduces disability and death (Davis et al., 2008; Garbuz, Xu, Duncan, Masri, & Sobolev, 2006; Hodge et al., 2007; Koomen et al., 2001; Novack, Jotkowitz, Etzion, & Porath, 2007; Sobolev et al., 2006). Almost three times as many patients in Canada and the UK as U.S. patients report waiting four months or longer for elective surgery (Canadian Institute for Health Information, 2011). Wait times are the dominant complaint of Canadians, while for U.S. resi- dents, cost is the major factor, and waiting too long for care is relatively minor.

U.S. Healthcare System Compared to Other National Systems Chapter 11

Surgery and Preventive Care

Up to 30% of U.S. healthcare spending has been attributed to overuse (Delaune & Everett, 2008). Th e United States has the highest rates of procedures that restore blood fl ow to the heart—double the rates of other countries with similar mortality rates from heart disease (Docteur & Berensen, 2009). Access to care in the United States with respect to the treatment of all conditions except that of asthma is better than most other countries. In the United Kingdom, the rate of coronary bypass surgery or angioplasty performed is only one-fourth of the U.S. rate, and hip replacements are only two-thirds of the U.S. rate. Th e rate for treating kidney failure (dialysis or transplant) is fi ve times higher in the United States for patients age 45 to 84 and nine times higher for patients 85 years of age or older (Aaron & Schwartz, 2005).

Preventive care is also practiced less in other countries. Women in the United States have high rates for preventive screening such as pap smears and mammograms compared with other coun- tries (Davis et al., 2006). In Canada, twice as many middle-aged women have never had a mam- mogram and three times as many Canadian women have never had a pap smear compared with American women. Fewer than 20% of Canadian men have ever been tested for the prostate- specifi c antigen, compared with about 50% of U.S. men. Th ree times as many U.S. men have had a colonoscopy compared to Canadian men. Some authors cite the higher Canadian mortality rates for breast, prostate, and colorectal cancer as a consequence of a low rate of use for preventive measures (O’Neill & O’Neill, 2008).

Quality of Care

Findings are mixed when it comes to the quality of U.S. care based on adult hospital admis- sion rates for asthma, end-stage renal disease, treatments for diabetes, hypertension, heart dis- ease, hip fractures, and vision impairment. Some data suggest better outcomes for some diseases and worse for others. However, more U.S. residents than Canadians are fully satisfi ed and rank quality of care as excellent. German patients were more satisfi ed than American patients, while British and Canadian patients were the least satisfi ed (Nolte & McKee, 2008).

Contrary to the average American, doctors were unhappy with the healthcare system and more likely to believe that the system needs complete rebuilding (Blendon et al., 2004). A survey of U.S. physicians noted that they were more limited in information capacity, provided less patient access outside of traditional work hours, and were among the least likely to work in teams or to receive fi nancial rewards for quality—all factors that could bear on the quality of primary care (Schoen et al., 2006).

Chronically ill or intensively ill patients in the United States more often report being given the wrong medication or dosage, experiencing a medical error, receiving incorrect test results, or facing delays in hearing about abnormal test results (Schoen et al., 2009). Patient reports of these types of problems were lowest in the Netherlands (17 %), France (18 %), and Germany (19 %), and highest in the United States (34 %). Primary care physicians in the United States are more likely to complain of patients having diffi culty paying for care and spending a lot of time on insurance restrictions compared with Norway, UK, Switzerland, Germany, and Australia, as Figure 11.5 shows. Physicians reporting patient aff ordability problems were the most likely to call for major change and were the most negative about practicing medicine (Commonwealth Fund, 2012a).

U.S. Healthcare System Compared to Other National Systems Chapter 11

Figure 11.5: Patients’ ability to afford care and insurance restrictions pose problems for U.S. primary care doctors

Doctors who indicate that their patients often cannot afford care are most likely to call for system-wide changes.

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NOR (Norway)

GBR (United Kingdom)

CHE (Switzerland)

DEU (Germany)

CAN (Canada)

FRA (France)

NLD (The Netherlands)

GBR (United Kingdom)

NOR (Norway)

FRA (France)

CAN (Canada)

CHE (Switzerland)

NLD (The Netherlands)

DEU (Germany)

USA (United States)

USA (United States)

0 10 20 30 40

Percent

50 60 70 80

Doctors report insurance restrictions on treatments a major time concern*

*Amount of time you or your staff spend getting patients needed medications or treatments because of coverage restrictions is a major problem.

Doctors report patients OFTEN have difficulty paying for care

4

13

16

21

26

29

42

59

9

11

17

21

23

26

37

52

Source: Adapted from 2012 Commonwealth Fund International Health Policy Survey of Primary Care Physicians. http://www.commonwealthfund.org/~/media/ Files/News/News%20Releases/2012/Nov/IHP%20release%20111212%20FINAL_v5.pdf

Summary and Resources Chapter 11

As Figure 11.6 shows, the highest percentage of patients who report problems paying medical bills or who put off needed care because of cost were uninsured.

Summary and Resources Th is comparative analysis of mostly OECD data focused on eight European countries plus Canada, Japan, Mexico, and the United States. Th e United States continues to lead the way in the amount spent on healthcare, both per capita and as a percentage of GDP, and on the num- ber of uninsured citizens. Th e U.S. system relies more on high-tech resources. Th e number and use of MRI machines and CT scanners are far greater in the United States than in any of the other OECD countries, except for Japan. Prescription use, prices, and per capita spending are also higher in the United States. However, Americans’ use of human and hospital resources is lower. Th e United States has fewer hospital beds and physicians and fewer hospital and physician visits than in most other countries. Spending per hospital visit remains the highest in the United States compared with all of the other OECD countries, and American patients are among the most likely to receive procedures requiring complex technology.

Figure 11.6: Health costs affect U.S. patients facing fi nancial diffi culties

Financial problems are widespread among uninsured Americans. Forty-two percent of uninsured Americans admitted delaying care, compared to 10% of those with employer- sponsored insurance.

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Visits to doctors

A m

er ic

an s

w h

o a

d m

it te

d d

el ay

in g

c ar

e (%

)

Visits to doctorsVisits to doctorsVisits to doctorsVisits to doctorsVisits to doctorsVisits to doctorsVisits to doctors

42

13 9

80

60

40

20

0

10 9 7 8

15 13

8

Hospital services Prescription drugs

32 31

Uninsured (age 18-64)

Medicaid

Medicare

Employer-sponsored insurance (age 18-64)

Uninsured (age 18-64)

Medicaid

Medicare

Employer-sponsored insurance (age 18-64)

Source: Norton, M., DiJulio, B., & Brodie, M. (2015, July). Medicare and Medicaid at 50. Retrieved from the Henry J. Kaiser Family Foundation website: https://www.kff.org/medicaid/poll-fi nding/medicare-and-medicaid-at-50/

Summary and Resources Chapter 11

Life expectancy in the United States is among the lowest of OECD countries. We have seen the smallest improvement over the past 25 years. The United States has a somewhat greater incidence of chronic health conditions despite evidence of greater access to health treatments for these conditions.

Wait times for access to care are not a problem in the United States. The long wait times in other countries are not without consequences, not only in terms of patient dissatisfaction, but also in terms of the cost of lost productivity and disability payments. In the United States, costs are more often a major source of complaint, despite the existence of broad private and public coverage. When asked about satisfaction with health services and the ranking of the quality of services recently received, more U.S. residents—but not physicians—say they are fully satisfied and rank quality of care as excellent.

All countries are facing similar issues regarding their healthcare systems, which will change institutional relationships. In the developed world, the patient population is aging where use and cost are increasing, while empowered patients are demanding increased control and more transparency.

More technological possibilities, faster transfer of information, more choice, and more market incentives are changing relationships between state, society, markets, and medical professionals. The role of government in healthcare is being redefined, which will have direct consequences for the character, organization, quality, and safety of healthcare (Ngo, den Breejen, Putters, & Bal, 2008).

Key Terms

amenable mortality Deaths that potentially could have been prevented by timely access to appropriate healthcare.

Beveridge Model A healthcare system that provides healthcare financed by the government through tax payments.

Bismarck Model A healthcare system based on an insurance system funded jointly by employ- ers and employees through payroll deductions. The system must cover everyone and cannot make a profit.

Gross domestic product (GDP) The monetary value of all finished goods and services pro- duced within a country in a year.

infant mortality The number of deaths in the first year of life per one thousand live births.

morbidity The state of being diseased or unhealthy within a population.

mortality Proportion of deaths to population.

National Health Insurance Model A system with features of both the Bismarck and Beveridge models that uses private-sector providers who are paid from a government-run insur- ance program that every citizen pays into.

neonatal mortality The number of deaths in the first 28 days of life per one thousand live births.

Summary and Resources Chapter 11

obesity Defined by the World Health Organization as a person’s body mass index greater than or equal to 30. Body mass index is defined as weight in kilograms divided by the square of height in meters (kg/m2).

Organisation for Economic Co-operation and Development (OECD) An international eco- nomic organization founded in 1961 to stimulate economic progress and world trade.

out-of-pocket model A healthcare system where individuals are responsible for the total cost for their healthcare either by purchasing insurance or paying for healthcare at the point of service.

overweight Defined by the World Health Organization as a person’s body mass index greater than or equal to 25. Body mass index is defined as weight in kilograms divided by the square of height in meters (kg/m2).

perinatal mortality The number of deaths in the first week after birth, plus fetal deaths after 28 weeks of gestation or fetuses that exceed a weight of one thousand grams (2 pounds, 3.3 ounces).

potential years of life lost (PYLL) A measure of the total number of years an individual would have lived had he or she not died prematurely.

secondary care Medical care provided by a physician who acts as a consultant at the request of the primary physician.

tertiary care Specialized medical care provided by consulting physicians on referral from pri- mary or secondary medical personnel.

underwritten A process used by service providers (e.g., banks, insurance companies) to assess a client’s eligibility for services.

Critical Thinking Questions

1. Considering cultural attitudes in the United States, which of the four health financing models most closely characterized the pre-Affordable Care Act (ACA) healthcare system? Which of these four models will the U.S. healthcare system resemble after the ACA is fully implemented?

2. In your assessment, what are the most important criteria for evaluating a country’s health- care system? Why?

3. Now that you have learned about healthcare systems across the globe, how would you describe the strengths and weaknesses of U.S. healthcare?

4. What obstacles to treatment might patients in countries such as Norway, the UK, or Mexico encounter?

5. From a practitioner perspective, describe some advantages of other countries’ healthcare models. For example, what factors would lead a doctor to want to practice medicine in Japan, France, or The Netherlands, as opposed to the United States?

6. The chapter discusses how healthcare spending does not necessarily translate to better health outcomes. Why do you think that is the case?

Summary and Resources Chapter 11

7. If the ACA results in increased efficiency, do you believe it will have a positive effect on some of the health indicators in which the United States lags other developed countries? Why or why not?

Suggested Resources

Papers and books

Armstrong, E. G. (2011). The health care dilemma: A comparison of health care systems in three European countries and the U.S. Hackensack, NJ: World Scientific Publishing Company.

Bovier, P. A., & Perneger, T. V. (2003). Predictors of work satisfaction among physicians. European Journal Public Health, 13, 299–305.

Lassey, M. L., Lassey, W. R., & Jinks, M. J. (1996). Health care systems around the world: Characteristics, issues, reforms. New York, NY: Pearson.

Websites

Commonwealth Fund. (2009). Surveys: International health policy: http://www.commonwealth- fund.org/Surveys/View-All.aspx?topic=International+Health+Policy

Organisation for Economic Co-operation and Development (OECD): http://www.oecd.org/

PBS Frontline. Sick Around the World: http://www.pbs.org/wgbh/pages/frontline/ sickaroundtheworld/view/