American are spending more on health care but why?

Leslie Hanson
March 14, 2018

In the U.S., the average salary was $218,173.

These costs are despite similar utilization rates for the USA compared to the other nations.

The United States does not use more health care than high-income peers like Canada, Germany, France and Japan, said study co-author Liana Woskie, assistant director of the Harvard Global Health Institute's strategic initiative on quality. Underinvestment in social services didn't appear to explain the difference, either.

Instead, health spending may be higher in the USA because prices are steeper for drugs, medical devices, physician and nurse salaries and administrative costs to process medical claims, researchers report in JAMA.

The study will be published March 13, 2018 in JAMA (Journal of the American Medical Association).

The study, conducted by researchers at Harvard University, debunks numerous common beliefs people have about why the USA spend so much money on healthcare.

'The reasons for these substantially higher costs have been misunderstood: These data suggest that numerous policy efforts in the USA have not been truly evidence-based, ' Dr Jha said.

A group of researchers compared data from the US and 10 other high-income countries: the United Kingdom, Canada, Germany, Australia, Japan, Sweden, France, the Netherlands, Switzerland and Denmark.

Per capita spending for pharmaceuticals was also higher in the USA - about $1,443 compared with a range of $466 to $939 in other nations. In 2016, the USA spent 17.8% of GDP, compared to 9.6%-12.4% in other countries. He notes, for example, that while US doctors make high salaries, there are fewer doctors per capita than in other countries, so the total cost of paying doctors isn't far out of line with countries like Germany or The Netherlands.

Life expectancy in the US was the lowest, at 78.8 years, the study also found. 'However, there are many different beliefs as to why this is the case'.

The U.S. had a lower percentage of its population covered by health insurance (90 percent) than those other rich countries, where 99.8 percent to 100 percent were covered. Yet, we found that the United States has comparable rates of utilization overall, with lower numbers of physician visits and hospitalizations, ' Dr Jha said.


Evidence: The primary care versus specialist mix in the U.S.is roughly the same as that of the average of other countries.

More doctor visits and hospital stays aren't the problem.

Australia spent 9.6% of GDP on healthcare and Switzerland spent 12.4%.

Belief: The U.S. spends too little on social services and this may contribute to higher healthcare costs among certain populations. For other countries, the average infant mortality rate was 3.6 fatalities for every 1,000 live births. In an editorial accompanying the new study, Katherine Baicker and Amitabh Chandra of the University of Chicago and Harvard note that the latest analysis doesn't delve into the qualitative details of health care treatments Americans get compared to people in other countries.

Infant mortality in the US was the highest of any country in the study. For example, the US appears to have the best outcomes for those who have heart attacks or strokes, but is below average for avoidable hospitalizations for patients with diabetes and asthma.

Instead, high prices for labor and goods, including drugs, procedures and administrative services, seemed to be the major reasons, according to the analysis.

A large part of this was administrative costs, which accounted for 8 percent of GDP in the US, more than double the average of 3 percent of GDP.

Spending per capita for prescription drugs was $1,443 in the US, compared to a range of $466 to $939 in other countries, the study found.

Some individual US states, however, have outcomes on par with other high-income countries. Medical procedures were similarly overpriced in the US, and American medical professionals also make significantly more money than their peers in other countries, according to the paper. In the USA, per capita spending was $1,443.

"International comparisons are very valuable".

People in the U.S. shell out $9,403 a year on health care services, while wealthy nations like Germany spend on average a little more $5,000.

Other reports by Iphone Fresh

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