U.S. versus European healthcare costs

I was very interested to delve into this topic deeper after we discussed it in class.

I studied abroad in Italy, developed Strep throat, and went to a doctor. However, instead of going to the public hospital, I was sent to a private, American doctor. I did not know any better at the time and listened to the advice of the school's headmaster.

However, when I came back to the states, people asked, "Why didn't you go to the public hospital, isn't it free?" Which made me think about public healthcare provided by the government verses private corporations.

Yes, we have learned and discussed the matter of USA spending the most compared to other countries on healthcare, with little difference in outcomes (if not poorer outcomes). I managed to find an article where the author delved into reasons why that was.

He had the following hypotheses as to why healthcare cost so much in the USA:

1. Most U.S. citizens are wealthy, so we just pay more in our economy overall
2. We have an older and sicker population
3. Americans tend to utilize more healthcare services (e.g., go to doctors, hospitals and emergency rooms more)
4. High costs comes from our use of more technology
5. We charge higher prices for the same goods and services.

When he compared the 5 hypotheses to the rest of the world, I found the answer to be surprising.

1. While most countries do spend more when they have more money, the U.S. disproportionately spends more, by about $3,000 per head on healthcare compared to other wealthy countries.
2. The proportion of the population older than age 65 is 13% in the USA. The data collected from the OECD (Organization for Economic Cooperation and Development) had a median of 16%. The USA's 13% is much lower than Japan’s 23%. Also, our population does not necessarily seem to be more ill. Among key healthcare risk factors such as smoking and drinking, Americans actually do better in most cases. Our major problem is obesity.
3. The average number of physician visits per person in the USA is 4, below the OECD median of 6.4, and far below Japan’s 13 visits per person. The average hospital stay per person is also lower in the USA at 5.4 days versus the OECD median of 5.9 days and Canada’s average of over one week (longer stay=higher costs).
4. Americans get less MRI scans per person than Japan, and have fewer hip and knee replacements and cardiac catheterizations than many European countries. In fact, the distribution of our spending (basic medical care, diagnostics, hospitals, pharmaceuticals, and nursing homes) is not very different from European countries.

This leads us to the last hypothesis: Do we charge higher prices for the same goods and services?

So the answer is, yes. More money is spent in the USA on drug and imaging, along with higher physicians’ fees and income compared to other countries in the world.

The question now becomes, if the USA really wants to cut back spending on healthcare, how?


Source:
http://epianalysis.wordpress.com/2012/07/18/usversuseurope/