This is the second in a series of posts about physician retirement planning that I created as part of a presentation that I am giving to fellows in training at...
Value = quality divide by price. So… does the United States have high quality and low price? Unfortunately, no. Every year, I look forward to the OECD annual health report and the newest version was released in June. The OECD is the Organization for Economic Cooperation and Development. It consists of most of the world’s industrialized countries and from it we can get a scorecard of how the United States is doing compared to other countries. For this post, I’ve chosen 5 OECD member countries to compare to the U.S. for simplicity: Canada, France, Ireland, Japan, and the U.K.; however, you can just as easily choose just about any combination of OECD and get similar results.
Since last year, not much has changed and by the metrics used in the report, Americans continue to have poor value in healthcare and in fact, the value that we get is among the lowest in the world. Let’s start with a look at our cost of health care as a percentage of our gross domestic product. Americans spend far more than any other country on healthcare. Currently, we spend 16.9% of our GDP on healthcare. That is 50% more than the next OECD country, Switzerland, which spends 11.5% of it’s GDP on health care. The U.S.’s cost of health care continues to keep going up: in 2000, we only spent 12.5% of our GDP on health care.
One reason why health care costs can be expensive is that there are a lot of physicians. But as it turns out, the number of physicians per capita is in line with or less than other OECD countries. The causes of the high cost is more related to suboptimal management of chronic medical conditions such as asthma, COPD, and diabetes. Americans are the most obese among the OECD countries with 29.5% of the U.S. population reporting that they are obese (the next closest is Latvia at 25.7%). With obesity comes additional health costs. We also do a lot of testing. Only Estonia does more CT scans per capita than the U.S. and only Turkey does more MRIs per capita than the U.S.
Americans could still have good value if our health care quality is superior to other countries. However, by many measures, it is not. Our infant mortality rate of 6 deaths per 1,000 live births is the third highest of all reporting OECD countries; only Mexico and Turkey have higher infant mortality rates. Our traffic injuries per million population is the highest of all reporting OECD countries. Our average life expectancy for both men and women is lower than the OECD average. Currently, the female life expectancy at birth in the U.S. is 81.2 years. The only OECD countries with a shorter life expectancy are Hungary, Latvia, Mexico, the Slovak Republic, and Turkey. The average life expectancy in the U.S for a male born today is 76.4 years, also one of the shortest among OECD countries.
How does the United States compare to other countries for health insurance coverage? Well, of the 34 countries with insurance data in the OECD, the only country with a lower percentage of the population covered by either government or private insurance was Greece. Thus, the U.S. was the second worse in the OECD. Thus access to healthcare in the U.S. is lower than nearly every industrialized nation.
The OECD summarizes all of the different member countries in their “Health at a Glance 2015” documents. Their key findings were:
- “Life expectancy in the United States is lower than in most other OECD countries for several reasons, including poorer health-related behaviors and the highly fragmented nature of the US health system.
- The proportion of adults who smoke in the United States is among the lowest in OECD countries, but alcohol consumption is rising and obesity rate is the highest.
- The quality of acute care in hospital in the United States is excellent, but the US health system is not performing very well in avoiding hospital admissions for people with chronic diseases.”
If you were to design an effective and efficient health care system from scratch, no one would design a system anything like what we have in the U.S. today, regardless of one’s political party affiliation. There are some great things about American health including the quality of our hospitals and our healthcare professionals. For a hospital medical director, it is up to us to maintain the high quality of acute care medicine and work to improve the quality of health of patients before and after they come into our hospitals. For every American, finding ways to reduce the cost of our healthcare is imperative if we are to remain competitive in world economic markets. It is up to us to decide how we catch up to the rest of the world while preserving those aspects of health care that we presently do better than anyone else.
August 9, 2016