The State of Health Care- The Basic Facts

What are the basic facts relating to our health care system? The facts listed come from a variety of respected and trusted sources (OECD, WHO, The Henry J Kaiser Foundation etc.) and readers are encouraged to read the sources for themselves. Nothing brings home the facts better and readers do not have to depend on intermediaries such as this blog or get their knowledge from second-hand comments posted in response to newspaper articles.

1) The US spent $2.1 trillion in 2006 and $2.2 trillion in 2007 on health care- overall. This expense is expected to continue its upward trend to $2.4 trillion in 2008 and $2.5 trillion in 2009. To get a sense of the rapid rate of increase in overall health care spend, we spent $28 billion in 1960, $714 billion in 1990 and $1.35 trillion in 2000.

2) In order to do a meaningful comparison of health care spend across countries, one can look at per capita spend on health care (expenditures per person) or the percentage of GDP spent on health care. As should be expected, based on the US being the richest country in the world (on a GDP basis) the US has the highest per capita spend on health care (2006- $6714) followed far behind by other developed countries. Health care spending is currently 15% of GDP and is expected to reach 19.7% of GDP by 2017 (Keehan et al, 2008.) Looking still further out in time, the Congressional Budget Office estimates that health care spend will reach 35% of GDP by 2035 and 41% of GDP by 2060. So, it is easy to understand the concern expressed by those willing to do so.

3) You would assume that because we spend the most on health care our health care outcomes should be much better than those of any other country's, right? The truth is that while on some measures the US outperforms the rest of the world, in other cases we lag the developed world. For example, new drugs and technologies are brought into the market place quicker in the US than elsewhere and the wait time for doctor's visits is only eclipsed by Germany (marginally). Outcomes for cancer are also better than almost any other country. In terms of overall measures of health and in relation to the amount of money spent on health care we lag on many countries in the developed world.

As an example, life expectancies have been increasing in all the countries in the developed world. In the US life expectancy at birth overall- as measured between 2003-05 had risen to 77.7 years from an average of 70.2 in 1960-62. Because the rate in the life expectancy of women did not rise as fast as it did for men, the US, which had a life expectancy above the OECD average, has fallen below the OECD average. Only Hungary, Slovakia, Poland and the Czech Republic do worse than us on this measure.

Similarly, when looking at life expectancy at age 65, the US falls below the OECD average for both men and women.

While, this is not an admirable ranking in itself, the result is more striking when looking at life expectancies between populations grouped according to race- white, african americans and others.

It may be argued that as the US has a higher rate of deaths caused by causes other than natural ones (accidents, homicides etc.), but even after factoring in those causes, the lower US average is not able to account for the higher health care spend.

The infant mortality rate in the US at 6.9 deaths per thousand live births is the worst after Slovakia (2004-06).

For historical, political and social reasons, the US does not provide universal health insurance to it's citizens. Of the OECD countries the other 2 are Turkey and Mexico.

4) In the US the consumers of health care fall into the following categories (Commonwealth fund):
a) Employer provided healthcare insurance for more than 160 million workers and family members
b) Medicare for 44 million old and disabled citizens (Henry J Kaiser Foundation, June 2007)
c) Medicaid serves nearly 59 million low income families and children
d) Privately purchased health insurance by about 12.8 million individuals
e) Nearly 47 million uninsured or underinsured.

In following blogs we will tackle the common myths associated with US healthcare. When I say common myths, I refer to the typical bugbears raised by those who feel that we have the best health care system in the world and any moves towards universal health care are a move towards "socialism".