The Olympics are over but the memories and images of athletes giving their all to win honor for their homelands remain. We saw competitors bring different approaches to pole vaulting, discus throwing or simply breaking out of the pack in distance races and BMX.
Yet we never saw any athlete prepare don a brick-filled backpack just before the call to “set” is announced — which is what the United States does from the start as a global economic competitor by clinging to a health care system that is inefficient as well as inequitable. In lay terms, that means wasteful and unfair.
Poet Robert Burns argued that “to see ourselves as others see us” is a gift. That’s hard to do as an individual and perhaps impossible for 331 million people as a whole. Yet a first step, simply comparing ourselves to others, is a big first stride.
Decades ago, colleges taught courses in “comparative economic systems.” But then communist regimes collapsed and many economists agreed these courses were a waste of time since the U.S. approach was now dominant.
Fortunately, some institutions continue useful system-by-system comparative studies of sectors like health care. The Commonwealth Fund, a New York-based philanthropic foundation, is one and it just released “Mirror, Mirror 2021 — Reflecting Poorly: Health Care in the U.S. Compared to Other High-Income Countries.”
The report compares health system performance in five categories across 11 different high-income industrialized countries and contrasts this to spending. Such comparisons are not new and the conclusion that we are an outlier in terms of high cost and low performance won’t surprise anyone familiar with the issue.
Skeptics of comparing anything done elsewhere with the U.S. will assert that measures of performance in some sector like health care inherently involve subjectivity in choosing, measuring and weighting indicators. This is true. So the simplest is to read the 41-page report for oneself. You can download a pdf from the link above.
The nations compared in the study include the United States and Canada, Australia and New Zealand plus France, Germany, Sweden, the Netherlands, the United Kingdom, Switzerland and Norway. The European nations excepting the last three are members of the European Union. Note that Japan is not included nor are southern EU nations such as Italy, Spain or Portugal or any of the newer ex-communist EU members such as Poland or Hungary. The study, therefore, is of countries with northwest European political cultures.
Much of the debate in our own nation over the past two decades has been about remedying injustices in access to care. President Barack Obama’s Affordable Care Act focused on these, introducing insurance exchanges, premium subsidies for low-income people and expansion of Medicaid. It improved things for many, but problems still remain. We still do less well on access than similar-income countries.
Then there is cost. Our spending on health care is nearly 17 percent of the value of total output of goods and services, or GDP. The comparable average for the other 10 countries in this survey is a bit under 11 percent. Because our per-capita GDP generally is higher than the others, the disparity in absolute money value of health spending here is greater than in fractions of GDP. But here one gets into questions of which exchange rates to use in such dollar-to-euro or -franc comparisons, so leave it at the basic fact that we spend more in money terms in addition to a higher proportion of output.
It is informative to look, however, at what the 6 percentage-point GDP difference means in our nation. This year, output is about $20.9 trillion. Six percent of that is $1.25 trillion. This brings us back to the analogy of an Olympian choosing to load up on bricks prior to an event: Even if we did not improve the performance of our health system at all, if we could just get costs down to the average of the other studied nations, we would have $1.25 trillion that could go to meet other needs. That is more than we spend on Social Security. It is nearly twice what outlays on the Defense Department.
With the 2020 census numbers of 331 million Americans, the 6-point difference nears $3,800 per person in our country. Bullwinkle Moose would call this “anti-histamine money, it ain’t nothing to sneeze at.” It has the effect of a tax imposed on every household, one not owed in any other similar nation.
It is also instructive that Canadians, our neighbors to the north with a similar economy and political culture, rank only slightly better than we do in the study’s performance measures, 10th overall and 10th in two of the five sub-categories of measures. But they do it with 6 percent less of GDP.
Whenever one raises such issues, inevitably one hears that our nation has more path-breaking technologies and procedures. Moreover, there is the issue of comparative waiting times for surgeries in Canada and the U.K. These are reflected in part in the study’s “care process” rubric, in which we come in second while France, Germany and Sweden cluster at the bottom.
Yes, we have highly advanced medicine, but our edge is not nearly as great as we think. Yes, other nations also have problems, serious ones. But much of our opinions about health care in other countries is based in myth and imagination, not reality.
The knotty problem, even if we accept that our country does not perform well, is how we change it. Invoking “single-payer” (in other words, government pays) as some sort of panacea is futile when we already have high-cost individuals and institutions with much to lose from change already in place; this is like calling for “gun control” when there are 400 million guns in private hands. One cannot simply reverse out of a rut into which we have driven ourselves over decades.
Still, seeing ourselves in comparative context is a necessary first step. The Commonwealth study may not be flawless, but it is an excellent starting point for citizens who care.
St. Paul economist and writer Edward Lotterman can be reached at stpaul@edlotterman.com.
Real World Economics: Weighed down by an inefficient health care system - TwinCities.com-Pioneer Press
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