Become informed and defend your freedoms.  This is a website for citizens by an independent citizen.

statements of the many problems

Assessment of Healthcare in US (for the link to the full pdf file)

NCPA, 2009

ABSTRACT Many arguments for the superiority of other health care systems have been repeated often: the United States spends more than any other country, but its health outcomes are often worse. Whereas no one is ever denied care because of an inability to pay in countries with universal coverage, as many as 18,000 people in the U.S. die each year because they are uninsured and more than half of all bankruptcies are caused by medical debts. Also, other countries avoid our high administrative costs. Yet these and other assertions are debatable. Some are demonstrably false.

However, normal market forces have been so suppressed throughout the developed world that purchasers rarely see a real price for any medical service. As a result, summing over all transactions produces aggregate numbers in which one can have little confidence. In addition, other countries more aggressively disguise costs, especially by suppressing provider incomes.

Economists have long known that international health care spending comparisons are fraught with potential error.  Even for uncomplicated dental fillings, reimbursement data underestimate total costs by 50% in nine European countries.  Countries account for long term care and out-of-pocket spending differently. The accounting treatment of overhead and capital costs also varies. An OECD project to harmonize national accounting methods began in 2000,

Even taking the monetary totals at their face value, the US has been neither worse nor better than the rest of the developed world at controlling expenditure growth. The average annual rate of growth of real per capita US health care spending is slightly below OECD average over the last decade (3.7% vs. 3.8%), and over the past four decades (4.4% vs. 4.5%).    Despite common perceptions, a country’s financing method—public vs. private financing, general revenue vs. payroll taxes, third-party vs. out-of-pocket spending—is unrelated to its ability to control spending.

For the US, the practical question is, can the adoption of another country’s health care system offer a reasonable chance of improving US private sector methods?   An answer in the negative is suggested by a comparison of the British National Health Service and California’s Kaiser Permanente found that Kaiser provided more comprehensive and convenient primary care and more rapid access to specialists for roughly the same cost.

Finally, international spending comparisons typically ignore costs generated by limits on supply.

Are US Outcomes No Better and in Some Respects Worse Than Those of Other Nations?

Analyses that answer this question in the affirmative are often based on data showing that US life expectancy is similar to that of other developed countries and that its infant mortality rate is among the highest. Yet within the US, life expectancy at birth varies enormously among racial and ethnic groups, from state to state, and across US counties. These differences often are attributed to such lifestyle choices as diet, exercise and smoking rather than to differences in the quality of health care. Similarly, US infant mortality varies by a factor of two or three to one across racial and ethnic groups, across the largest cities, and across the states for reasons apparently having little to do with health care. The low US international ranking reflects national differences in the definition of a live birth. Eberstat finds that US infants, stratified by birthweight, have a high likelihood of survival, regardless of race or economic circumstances.

Is the Large Number of Uninsured in the US a Crisis?

The US is the only developed country in which a substantial subpopulation is nominally uninsured. Although this is said to be a crisis because the uninsured lack access to health care, the number of uninsured, and its consequences, are not clear.

The most widely used estimates of the number of US uninsured are from the US Census Bureau’s Current Population Survey (CPS). It estimates that 47 million people were uninsured for the entire year in 2005. The Survey of Income and Program Participation (SIPP), another Census Bureau survey, estimates about half that number. The Medical Expenditure Panel Survey (MEPS) and the National Health Interview Survey (NHIS) also generate lower estimates. Many experts believe the CPS estimate is actually an estimate of the number of uninsured at a point-in-time. It is similar to the point-in-time estimates of SIPP (43 million in 2002), MEPS (48 million in 2004) and NHIS (42 million in 2004).    In fact, we do not know how much morbidity and mortality is attributable to lack of health insurance.

Once people see a provider, a RAND study suggests that insurance status has little effect on receipt of recommended care.  However, the uninsured and those on Medicaid may be more likely to delay seeking care.   An American Cancer Society study found that, relative to people with private insurance, the uninsured and Medicaid-insured were more likely to present with advanced-stage cancer at diagnosis.

Many proposals for universal health care coverage envision enrolling more people in Medicaid, in SCHIP plans paying Medicaid rates, or in private plans paying Medicaid rates.  Such efforts encourage people to drop their private coverage.  Cutler and Gruber estimate that every extra $1 spent on Medicaid reduces private health insurance by 50-75¢. For SCHIP, the Congressional Budget Office projects a crowd-out rate of 25% to 50% and Gruber estimates it at 60%. Unfortunately, this substitution may lead to worse health outcomes. Low Medicaid reimbursement is associated with lower quality care. Perhaps because of non-price barriers and low reimbursement for some types of care, being enrolled in Medicaid is only marginally better than being uninsured.

Recalculating the study’s data, Dranove and Millenson conclude that only 17% of the sample “had medical expenditure bankruptcies.”

Are Administrative Costs Higher for Private Insurance Than Public Insurance?

The Congressional Research Service has estimated the administrative costs of Medicare at 2% of the total program costs, compared to 10% for private insurance and 12% for HMOs. Some single-payer advocates have used this estimate as an argument for a universal Medicare program. These estimates ignore hidden costs shifted to the providers of care, and the social costs of collecting taxes to fund Medicare. A Milliman & Robertson study estimates that, when these costs are included, Medicare and Medicaid spend two-thirds more on administration than private insurance spends on administration: 27 cents, compared to 16 cents, respectively, for every dollar of benefits.

In Canada, the wealthy and powerful have significantly greater access to medical specialists than less-well-connected poor.  High-profile patients enjoy more frequent services, shorter waiting times and greater choice of specialists. Moreover, among the nonelderly white population, low-income Canadians are 22% more likely to be in poor health than their US counterparts.

Can the Free Market Work in Health Care?

The US system is often portrayed as more market-based than the systems ..more in the pdf file.