In Every Other Country ... Comparing Health Care Systems and Results by Art Myatt a MichUHCAN Publication September, 2001 "Of all the forms of inequality, injustice in health care is the most shocking and inhumane." - Martin Luther King, Jr. Contents: Introduction Statistics and Sources Australia - Austria - Belgium - Britain - Canada - Cuba - Denmark - Finland - France - Germany - Israel - Japan - Netherlands - New Zealand - Norway - Spain - Sweden - United States Conclusions __________________________________ Introduction The American health care system is in trouble, and if nothing is done to change it, will soon be in crisis. Perhaps it would be more accurate to say it will be in crisis everywhere, whereas now the crisis is localized to only some areas. The situation was bad before HMOs were touted as "the solution" to rising costs, and has only gotten worse. When emergency rooms in an area are closed, they are closed for everyone. When hospitals in the cities are closed and not replaced, the system has failed, plain and simple. Where it has not yet failed, it costs too much and does too little. Patients are not satisfied with their care and go broke trying to pay for prescription medication. Doctors argue with insurance companies over treatments and payments. Nurses have to fight for decent pay and fight to avoid excessive overtime, but don't get to use much of their time on patient care. Untrained workers in hospitals fear the responsibilities involved in dealing with IVs, dressings, blood draws, and a host of things that nurses should be doing, but find it difficult to speak out because they need their jobs. The government's idea of patients' rights is to make a compromise on who can sue whom for how much. It does not have to be this way. It is not this way in most industrialized countries around the world. If we could pay a bit of attention to the health care systems in these other countries, perhaps we could see how to fix our own. This booklet attempts to do a very rough comparison of the health care system of the United States with the health care systems of seventeen other nations. We are only looking at how good a given health care system is for the patients, the citizens of the country. We are not looking to see how well it treats insurance companies or drug companies, or how much money it generates for politicians. Certainly, more sophisticated and analytical studies have been done. This booklet is only an attempt to highlight the most basic facts relevant to health care, without resorting to a single chart, graph or table of numbers. __________________________________ Statistics and Sources Infant mortality is one common measure of how good health care is. It counts the number of children born, and also counts the number who die in the first year of life. The cause of death does not matter here. No child is uncounted because the death is somehow "excusable." The number does not tell you if children are dying because of genetic defects, or disease, or malnutrition. It does not count abortions or miscarriages. It just says that, out of every thousand children born alive, some number died. The lowest number reached shows what is possible. Any higher number indicates the system is not doing what is possible. Life expectancy also indicates how good the health care of the society is. This is not 100% the responsibility of doctors and hospitals, of course. One country may be less polluted than another, and so have less cancer to deal with. The citizens may be more inclined to walk to work, or ride bicycles, which is less convenient and means less sales for the auto industry, but is certainly healthier. It may have to do with the availability of health care; for example, a diabetic might get early diagnosis and proper treatment, instead of neglecting the symptoms (because of no insurance) until the condition becomes life-threatening. All these factors go into life expectancy. And perhaps all these factors should be the concern of a comprehensive system of health care, which should not be just a system of disease treatment. In the end, it should be fair to say that the average citizen will not live so long if the health care system is terrible, regardless of what other factors come into play. All information on infant mortality and life expectancy comes from the U. S. federal government, specifically the "World Factbook" found on the web at http://www.odci.gov/cia/publications/factbook/index.html - and yes, this is a public service of the Central Intelligence Agency. If there is any error in these figures, or slant in favor of the United States, we can blame the CIA. Gross Domestic Product (GDP) is a measure, not directly of incomes, but of how much wealth is available to the society in a given year. Using this figure on a per capita basis tells us how much wealth is available for each person in the society, and allows fair comparisons between countries of greatly different sizes. All GDP values here are given in United States dollars. The basic information of populations of countries other than the US, and the figures for per capita GDP, also come from the "World Factbook" mentioned above. Figures for what percentage of GDP is spent on health care come from the Organization for Economic Cooperation and Development (OECD) Health Data 2001 publication. Numbers for the populations of various states and regions of the US is the latest available from the US Census Bureau 2000 Census. Much of the commentary on the history and character of the health care systems of various countries comes from Physicians for a National Health Program. Some of the commentary on Cuba can be attributed to a paper, "Health Care in Cuba" by Jennifer Hamm, published on the web site of Tulane University. Information on Israel comes from the "National Health Insurance" page of the web site of the government of Israel. __________________________________ AUSTRALIA Australia's population of 19,169,083 people is roughly the same as that of Texas (20,851,820). Its infant mortality rate is 5.04 per 1,000 live births, noticeably better than the US's 6.82. Life expectancy at birth is 76.9 years for men and 82.75 years for women, about 2.6 years longer than in the US for each sex. Their per capita GDP is $22,200 in US dollars, about 65% of the US's $33,900. Australia spends 8.6% of its GDP on health care. The US spends 12.9%. This works out to $1909 per capita for Australia, vs. $4373 for the US - but the Australians get better results. The Australian government administers the compulsory national health insurance program (Medicare). National health insurance is funded by a mixture of general tax revenue, a 1.5% levy on taxable income (which accounts for 18.5% of federal outlays on health), state revenue, and fees paid by patients. The government funds 68% of health expenditures (45% federal and 23% state) and has control over hospital benefits, pharmaceuticals, and medical services. States are charged with operating public hospitals and regulating all hospitals, nursing homes, and community based general services. Additionally, the states pay for the public hospitals with federal government assistance negotiated via five yearly agreements. Mainly not-for-profit mutual insurers (private insurance) cover the gap between Medicare benefits and schedule fees for inpatient services. Private insurance covers 1/3 of the population and accounts for 11% of health expenditures. Patients are free to choose their GP. Primary care physicians act as gatekeepers, and physicians are generally reimbursed by a fee-for-service system. The government sets the fee schedules, but physicians are free to charge above the scheduled fee or they may directly bill the government when there is no patient charge. Prescription pharmaceuticals have a patient co-payment, and out-of-pocket payments account for 19% of health expenditures. Physicians in public outpatient hospitals are either salaried or paid on a per-session basis. __________________________________ AUSTRIA Austria is home to 8,131,000 people, slightly less than the number living in the state of Georgia (8,186,453). The infant mortality rate is 4.5 deaths/1,000 live births, better than in the US (6.82/1000). Life expectancy at birth is 74.52 years for men and 80.99 years for women, about the same as in the US. Per capita GDP is $23,400, about 69% of the US's. Of this, Austria spends 8% ($1872 per capita) on health care, about 43% of what the US spends, with better or comparable results. The country has universal access to health care through a compulsory system of social insurance. A system of private insurance also exists. Private doctors with contracts to the social insurance funds are paid on a fee-for-service system with expenditure limits based on the case and per doctor per pay period. Hospital physicians are salaried. Approximately 50% of the health expenditures are funded by progressive payroll taxes, 25% are financed by non-specific taxes, and the rest is funded directly out-of-pocket or through private insurance companies. The contributions to the health insurance funds (payroll taxes) are split between employers and employees on a parity basis. Patients are free to choose their physicians, as long as the physician has a contract with the insurer. Benefits and prices of services are fixed in agreements between representatives of the insured and representatives of the providers. All medical and nursing education is free. __________________________________ BELGIUM Belgium is home to 10.241,000 people, just 300,000 or so more than live in Michigan (9,938,444). Its infant mortality rate is 4.76 per 1,000 live births, and its life expectancy at birth is 74.47 years for men and 81.3 years for women. Infant mortality is significantly better than in the US; life expectancy, somewhat better. Belgium's per capita GDP is $23,900, of which it spends 8.8% on health care, or $2103 per capita, less than half of what the US spends to get - it's becoming a familiar refrain - better results. The Belgian health care system is funded primarily through sickness funds. Belgium's health insurance program operates at four distinct levels: the central government, national associations, federations of local societies, and local mutual aid societies. The general attitude in Belgium is that the pluralism of the health insurance system stimulates each local fund to work hard to attract and satisfy its members. Patients have their free choice of any doctor. Primary care physicians are paid via fee-for-service, directly from the patient, or partially reimbursed, except with low-income patients who are exempt from pay. They are reimbursed with a negotiated fee, but extra billing is allowed. Specialists are paid via fee-for-service and are not restricted to hospitals. __________________________________ BRITAIN The population of Britain is 59,511,000, bigger than any single state but smaller than the population of the American Midwest, which the latest census counts as over 64,000,000. The infant mortality rate in the United Kingdom is 5.63 per 1,000 live births, and life expectancy at birth is 74.97 years for men and 80.49 years for women. This is a little better than the US on all counts. 6.8% of Britain's per capita GDP of $21,800 goes towards health expenditures. Doing the math, this is $1482 per person per year, only 34% of what the US spends. (According to their plans, they will spend more in the near future.) Yet, the results are comparable. Britain has had a National Health Service (NHS) since 1948. The British government is a purchaser and provider of health care and retains responsibility for legislation and general policy matters. The government decides on an annual budget for the NHS, which is administered by the NHS executive, regional, and district health authorities. The NHS is funded by general taxation and national insurance contributions and accounts for 88% of health expenditures. Complementary private insurance, which involves both for-profit and not-for-profit insurers, covers 12% of the population and accounts for 4% of health expenditures. Physicians are paid directly by the government via salary, capitation, and fee-for-service. GP's act as gatekeepers. Private providers set their own fee-for-service rates but are not generally reimbursed by the public system. Specialists may supplement their salary by treating private patients. Hospitals are mainly semi-autonomous, self-governing public trusts that contract with groups of purchasers on a long-term basis. The British government has announced a huge funding increase for the NHS. Specifically, it will receive 6.2% more in funding every year until 2004. Current plans to improve the system over the next five years include hiring 7,500 more specialists, 2,000 GP's and 20,000 nurses; providing 7,000 more acute beds in existing hospitals and building 100 new hospitals by 2010; demanding that GPs see a patient within 48 hours of an appointment; and finally, guaranteeing that patients wait no more than three months for their first outpatient appointment with a specialist and no more than six months after that appointment for an operation. __________________________________ CANADA Canada's population size of 31,281,000 is roughly the same as that of California (33,871,648). Its infant mortality rate is 5.08 per 1,000 live births, better than our 6.82. Life expectancy at birth is 76.02 years for men and 83 years for women, a little less than two years better for men and a little more than two years better for women, compared to the US. Canada's per capita GDP is $23,300, $10,600 less than in the US. They spend 9.3% of that on health care, or $2167 per person per year. This is almost exactly half of what we spend, per person, every year, for the by-now familiar better results. National health insurance had been discussed in Canada at the federal level since 1919, but no real action was taken until 1944. Today, Canada's health system is characterized by single-payer national health insurance, and the federal government requires that insurance cover "all medically necessary services." National health insurance (Medicare) is a public program administered by the provinces and overseen by the federal government. Medicare is funded by general tax revenues. Federal contributions are tied to population and provincial economic conditions, and provinces pay the remainder. Medicare accounts for 72% of health expenditures. In addition, the majority of Canadians have supplemental private insurance coverage through group plans, which extends the range of insured services, such as dental care, rehabilitation, prescription drugs, and private care nursing. The private sector (private insurance and out-of-pocket payments) accounts for 28% of health expenditures. Most physicians in Canada are in private practice and accept fee-for-service Medicare payment rates set by the government. Provincial medical associations negotiate insured fee-for-service schedules with provincial health ministries. Some physicians set their own rates but are not reimbursed by the public system. Hospitals are mainly non-profit and operate under global institution-specific or regional budgets with some fee-for-service payment. Less than 5% of all Canadian hospitals are privately owned. __________________________________ CUBA Cuba's population of 11,142,000 is very close to Ohio's 11,353,140. The infant mortality rate in Cuba is 7.51 deaths/1,000 live births, comparable to our 6.82/1000 but definitely worse. In Cuba, life expectancy at birth for a man is 73.84 years, again slightly worse than our 74.24; for a woman, it is 78.73 years, more than a year off our 79.9. For the first time in this booklet, we have an example of a country with worse results than ours, though not as much worse as ours are worse than the best. Cuba has a per capita GDP of $1,700. This is about 5%, or 1/20 of the amount of wealth available to the US. It does not even make sense to ask what percentage of Cuba's GDP is spent on health care because, if they spent every penny of it on health care, they would only spend 39% of the $4373 per person that the US spends. In terms of available wealth, Cuba is clearly not in the same league as the United States. All Cubans receive free medical care, period. Personal finances or social standing is not a factor. There is one doctor for every 200 Cubans. The emphasis in the Cuban system is on preventive care for children, with the result that 9 out of ten one-year-olds are fully vaccinated. While services are available, there is a shortage of medications, including basic medications such as insulin, asprin, and antibiotics. Medical equipment, especially the newer and more expensive variety, is also quite scarce. The Cuban economy has diminished overall by a third since 1989. The United States Trading With the Enemy Act, mandating restrictions on the import of medications and equipment to Cuba for more than thirty years before the collapse of the Soviet Union, is still in effect. As a consequence, prescriptions, even for items we would consider simple over-the-counter drugs, are rationed. The government response has been to emphasize priority of care for the most vulnerable groups in the society; children, women with children, and the elderly. In 1997, Cuba ranked second among developing nations according to the Human Poverty Index, which weighs factors such as safe water, malnutrition, literacy and life expectancy, in addition to access to health care. __________________________________ DENMARK Denmark, a small country, is home to 5,336,000 people, almost as many as live in the state of Wisconsin (5,363,675). Denmark's infant mortality rate is 5.11 per 1,000 live births, and its life expectancy at birth is 73.95 years for men; 79.27 years for women. The infant mortality rate is better than ours, but here, men live a quarter of a year longer, and women, half a year. Denmark's GDP per capita is $23,800. Approximately 8.3% of GDP is spent on health care, making their expenses about $1975, or 45% of what we spend. The results are approximately the same, although Denmark spends half as much as we do. Denmark has had a single-payer national health system since 1961. The Danish health care system is funded by progressive income taxes, and is publicly administered. Hospitals are run by the 14 counties and the City of Copenhagen. Physicians who work with the hospitals receive salaries, which are determined by negotiation between government and doctor's unions. GP's are 40% per capita fee, and 60% fee-for-service. Specialists are mostly fee-for-service. All medical and nursing education is free. There is strong incentive for patients to choose a GP in their immediate area of residence. GP's will then make referrals to specialists. There are no co-pays for physician or hospital care, but patients do pay a share of drug costs - usually between 25 and 50%. Private insurance, held by approximately 27% of the population, is used mainly for medications and dental expenses. __________________________________ FINLAND Finland, with its population of 5,167,486, is a little smaller than Denmark. The state of approximately the same size is Arizona, with its population of 5,130,632. Finland has an infant mortality rate of 3.82 deaths/1,000 live births, way better than ours. For 100 babies that die here, only 56 do in Finland. Life expectancy at birth is 73.74 years for men and 81.2 years for women. For whatever reason, men live longer in the US, and women, longer in Finland. Finland is a fairly typical European conutry, with a per capita GDP of $21,000. The country spends only 6.9% of its GDP on health care, only $1449 per person. This is a mere 33% of what the US spends. Turning this number upside down, the US spends three times as much for - let's hear the chorus - about the same results. In 1964, national health insurance was enacted in Finland. The Finnish health system is primarily funded (80%) by general tax revenues collected by the local and national governments. The basic administrative levels in Finland are divided into communes and municipalities. The local authorities in Finland number 445, averaging about 10,000 people each. GP's practice mostly in health centers. They are salaried, but many are paid fee-for-service for overtime. Hospital physicians, who must be specialists, are salaried. __________________________________ FRANCE France is has a population similar to Britain's; 59,330,000 in this case. This is comparable to the Western region of the US, which the Census Bureau measures at 63,197,932. France has an infant mortality rate of 4.51 deaths/1,000 live births, better than Britain and considerably better than the US. France's life expectancy at birth is 74.85 years for men and 82.89 years for women; better by half a year for men and by three years for women. The per capita GDP of France is toward the high end for European countries at $23,300, and 9.4% of it is spent on health care. This gives a relatively high $2190 per capita, or just slightly more than half of US expenses. The country has had a national health insurance system since 1928, but universal coverage did not occur until 1978. The French health care system is primarily funded by Sickness Insurance Funds (SIF's), which are autonomous, not-for-profit, government-regulated bodies with national headquarters and regional networks. They are financed by compulsory payroll contributions (13% of wage), of employers (70% of contributions) and employees (30% of contributions). SIF's cover 99% of the population and account for 75% of health expenditures. The 3 main SIF's (CNAMTS, MSA, and CANAM) cover about 95% of the population, and the remaining 5% of the insured population are covered under 11 smaller schemes. The remainder of health expenditures is covered by the central government, by patients' out-of-pocket payments, and by Mutual Insurance Funds (MIF's), which provide supplemental and voluntary private insurance to cover cost-sharing arrangements and extra billings. MIF's cover 80% of the population and account for 6% of health expenditures. The major public authority in the French health system is the Ministry of Health. Below this are 21 regional health offices that regulate each of the 95 provinces. Patients are free to choose their providers and have no limits on the number of services covered. GP's have no formal gatekeeper function. Private physicians are paid on a fee-for-service basis and patients subsequently receive partial or full reimbursement from their health insurance funds. The average charge for an office visit to a GP and a specialist are $18 and $25, respectively. Private hospitals are profit-making and non-profit making, usually with fee-for-service physicians. Public hospitals employ salaried physicians, who make up 1/3 of all GP's in France. All medical and nursing education is free. __________________________________ GERMANY Germany is home to approximately 82,797,000, nearly 1/3 of the U.S. population. To match this, we will have to take the Midwest's 64,392,776 and add in Texas' 20,851,820, to come up with a total of 85,244,596. Germany's infant mortality rate is 4.77 deaths/1,000 live births, and its life expectancy at birth is 74.3 years for men and 80.75 years for women. The life expectancy is barely better for men, and almost a year better for women. The infant mortality is clearly better than the US rate of 6.82. The per capita GDP of Germany is $22,700. Today, Germany spends 10.6% of its GDP on health care, resulting in a per capita expense of $2406. This means that Germany actually spends 55% as much as the US, a figure that by now might seem surprisingly high. This high figure means that the US could realistically cut health care costs in half, if only we could figure out how. In 1883, Germany was the first country to establish the foundations of a national health insurance system and has since gradually expanded coverage to over 92% of the population. Everyone in Germany is eligible for health insurance, and individuals above a determined income level have the right to obtain private coverage. The German health care system is predominantly characterized by Sickness Insurance Funds (SIF's), which are funded by compulsory payroll contributions (14% of wage), equally shared by employers and employees. SIF's cover 92% of the population and account for 81% of health expenditures. The rest of the population (the affluent, self-employed, and civil servants) is covered by private insurance, which is based on voluntary, individual contributions. Private insurance accounts for 8% of health expenditures. GP's have no formal gatekeeper function. Private physicians, over half of which are specialists, are paid on a fee-for-service basis. Representatives of the sickness funds negotiate with the regional associations of physicians to determine aggregate payments. Physicians who work in hospitals are full-time salaried specialists, whose work is entirely devoted to in-patients. All medical and nursing education is free. __________________________________ ISRAEL Israel's population is a mere 5,842,000, which would put it in between the state of Tennessee (5,689,283) and the state of Washington (5,894,121). The infant mortality rate is 7.9 deaths/1,000 live births, a full point worse than in the US. Life expectancy at birth is, however, better than in the US, at 76.57 years for men (2-1/2 years better) and, for women, 80.67 years (about 2/3 of a year better.). Overall, this would have to rate as comparable results for their health system. Israel's GDP per capita is low compared to most European countries, at $18,300. In 1997, they spent 8.4% of their GDP on health care. This figure is out of date, so let's assume current expenditure is nearer 9%, just to be reasonable. This would make the expenditure about $1650, or about 38% of our $4373. The National Health Insurance Law, which went into effect in January of 1995, gives the state the responsibility of providing health services for all residents. Four organizations which had, prior to this law, provided health insurance to a majority of residents are incorporated into the new system. The law says that these organizations cannot now bar any applicant on any ground, including age or state of health. The organizations are required to supply all the services included in a comprehensive list determined by the law. In addition to the obvious hospitalization and medicines, also included are perventive dental care for children, medical treatment of alcohol and drug abuse problems, and paramedical services such as occupational and physical therapy. Financing is complicated. First, there are compulsory premiums collected directly from the insured, set at 3.1% of the portion of the salary equal to half the average wage, and 4.8% of the balance of the salary, up to four times the average wage. the government may increase the services covered on the comprehensive list, but may not reduce them unless specifically authorized by a standing committee of the Knesset. Health care organizations may offer supplementary insurance for services not included in the comprehensive package. The ministry of Health supervises the equality and availability of medical services supplied by the health-care organizations, and runs a public complaints office. __________________________________ JAPAN Japan has a population of 126,550,000 people. The American South, as defined by the Census Department, is just over 100 million, so we would have to add California's 33,871,648 to that region to make up a comparable section of the US. The infant mortality rate in Japan is 3.91 deaths/1,000 live births, far superior to our 6.82. In Japan, life expectancy at birth is at 77.51 years for men and 84.05 years for women, 3-1/4 and 4 years longer, respectively, than in the US. Japan's per capita GDP is $23,400, so the US is clearly the wealthier country, by over $10,000 per person. Approximately 7.4% of Japan's GDP is spent on health care, making the per capita expense $1732, or just under 40% of what the US spends. The pattern of equal or better results in health care for about half of the US cost is by now becoming crystal clear. Japan's current system of universal health care was initiated in 1958. The Employee's Health Insurance System is financed by compulsory payroll contributions (8% of wages), equally shared by employers and employees, and covers employees and their dependents. The National Health Insurance System covers the self-employed, pensioners, their dependents, and members of the same occupation. The local governments act as insurers, and premiums are calculated on the basis of income, the number of individuals in the insured household, and assets. Premiums account for 57% of health expenditures. The federal government contributes 24% to medical care expenditures and local governments contribute 7%. About 80% of hospitals and 94% of private clinics are privately owned and operated. While some public not-for-profit hospitals exist, investor-owned for-profit hospitals are prohibited in Japan. Patients are free to choose their ambulatory care physicians, who are reimbursed on the basis of a negotiated, uniform fee-for-service schedule. Physicians have no formal gatekeeper function. Due to the combination of medical and pharmaceutical practices a large part of a physician's income is derived from prescriptions. Hospital physicians have fixed salaries. __________________________________ NETHERLANDS The Netherlands has a population of 15,892,000, which is approximately the same as the number of people who live in the state of Florida (15,982,378).The infant mortality rate is 4.42 deaths/1,000 live births, and life expectancy is at 75.4 years for men and 81.28 years for women. Across the board, the numbers are better than those for the US. Per capita GDP is normal for a European country at $23,100. The Netherlands spend 8.7% of GDP on health care, or $2010 per person per year, 46% of the US's $4373. The health care system in the Netherlands is very similar to that in Belgium; health care is primarily financed by employer-employee social insurance. Health care is provided by private not-for-profit institutions, and the compulsory health insurance system is financed through sickness funds. 70% of the population is in the public health care system. 30% of the population (mostly civil servants and high-income groups) has private insurance, because they are not eligible for social health insurance. There are currently plans to convert the entire system to a tax-based one. Most primary care physicians are in a solo office practice (54%) or practice in small groups. Reimbursement is by capitation for "public patients" (2/3) and via fee-for-service (1/3). Specialists are salaried and are restricted to hospitals. __________________________________ NEW ZEALAND New Zealand's population is 3,820,000, which puts it between Oklahoma (3,450,654) and South Carolina (4,012,012) in size.. The infant mortality rate is 6.39 deaths/1,000 live births and life expectancy is at 74.85 years for men and 80.93 years for women. This is slightly better than in the US, but essentially similar. New Zealand's GDP per capita is a rather low $17,400. They spend only 8.1% of it, or $1410 on health care. This is 32%, or less than 1/3, of US expenditures, and yet the results are as good or better. In 1941, New Zealand achieved universal coverage and was the first country with a free-market economy to do so. Radical health sector restructuring occurred in 1993, which introduced a set of market-oriented ideas. However, the new system performed poorly and was thus again restructured 3 years later The health system is funded through taxation and administered by a national purchasing agent, the Health Funding Authority (HFA). Health care is provided by 23 hospital provider organizations (Hospital and Health Services), GP's (most of whom are grouped as Independent Practitioner Associations, IPA's), and other noncrown providers of child care, disability support services, etc. These parties compete for the provision of health services. Public funding accounts for 76% of health expenditures. Complementary, non-profit, private insurance, on the other hand, covers about 1/3 of the population and accounts for 7% of health expenditures. It is most commonly used to cover cost-sharing requirements, elective surgery in private hospitals, and specialist outpatient consultations. New Zealand's government is a purchaser and provider of health care and retains the responsibility for legislation and general policy matters. Health care is free for children, and all patients have their free choice of GP. Out-of-pocket payments account for 17% of health expenditures. GP's act as gatekeepers and are independent, self-employed providers. They are paid via fee-for-service, partial government subsidy, and negotiated contracts with HFA through IPA's. The payment system is currently moving from fee-for-service to capitation. Private insurance and out-of-pocket contributions pay the remainder. Hospitals are mostly semiautonomous, government-owned companies that contract with the HFA. Specialists are commonly salaried, but may supplement their salaries through treatment of private patients. __________________________________ NORWAY Norway is home to 4,481,000 people, a few more than live in the state of Louisiana (4,468,976). The infant mortality rate in Norway is 3.98 per 1,000 live births, and life expectancy at birth is at 75.73 years for men and 81.77 years for women. As usual, the results are all better than in the US. The per capita GDP of Norway is on the high side for a European country at $25,100, within $8800 of the US figure. They spend 9.4% of that, or $2360 per person, about 54% of the US expenditure. It is high for a European country, but still close to half of our expenses. Norway has had a single-payer national health insurance system since 1966. The National Insurance Act guaranteed citizens universal access to all forms of medical care. Norway's health system is funded by progressive income tax, and from block grants from central government, with 8.9% of GDP being spent on health care, and in 1998 the per capita expense was $2,425-US. Patients are free to choose their own physician and hospital, however, registration with local GP's who act as gatekeeper, will begin in 2001. Patients are responsible for co-pays for some physician visits, approximately $15. Patients are also responsible for co-pays for prescription drugs, up to $216 per year. Once that level of expense has been reached, prescription drugs are covered at 100%. All hospital care is covered at 100%. Hospital physicians have fixed salaries. GP's have either fixed salaries or fee-for-service agreements. All medical and nursing education is free. __________________________________ SPAIN Spain's population of 39,997,000 makes it closely comparable to California (33,871,648) plus the state of Washington (5,894,121). Infant mortality is 4.99 deaths/1,000 live births. Life expectancy at birth is 75.32 years for men and 82.49 years for women. All three figures are significantly improved over the US figures; that is, more than a whole point better for infant mortality and more than a whole year better for life expectancy for both sexes. The per capita GDP is $17,300, of which Spain spends 7.3% on health care; $1263, or an amazing 29% of the $4363 spent in the US. This is a full 71% less cost, for significantly better results. How do they do it? The country has had a comprehensive, single-payer national health service since 1978. The Constitution of 1978 explicitly affirms everyone's right to health care. The Spanish health care system is funded by payroll taxes through the National Institute of Health program (INSALUD), which in 1984 was 75% financed by employers and 25% financed by employees. Those with higher incomes have the option of obtaining private medical care. Public hospitals are run by one of the provinces or municipalities. The INSALUD program operates a large network of hospitals and ambulatory care clinics. Hospital physicians are on full-time salaries. All medical and nursing education is free. __________________________________ SWEDEN Sweden has a population of 8,873,000, making it larger than New Jersey (8,414,350) and smaller than Michigan (9,938,444). The country has an infant mortality rate of 3.49 per 1,000 live births and a life expectancy at birth of 76.95 years for men and 82.37 years for women. This is better by 3 points and by 2-1/2 years for each sex, or distinctly superior to the US records. Sweden's per capita GDP is normal for a European country at $20,700, as is the 8 to 9% of GDP it has spent on health care during the 1990s. Using the higher figure of 9% gives a dollar figure of $1863. The fact that this is 43%, or way less than half of the US cost, has lost its power to surprise. Sweden has had its current universal health care system since 1962. Tuition for medical and nursing education is free, and students generally take loans for living expenses of around $9,000-US per year. The Swedish health care system is financed by both incomes and patient fees. County councils own and operate hospitals, employ physicians and run the majority of general practices and outpatient facilities. Other physicians work in private practice and are paid by the counties on a fee-for-service basis. Co-pays, which were mandated in 1970, are capped, with limits on how much a person is required to contribute annually. For example, patients over age 16 pay $9 per day for hospitalization. The maximum individual expense for hospital and physician services is approximately $108 per year. The maximum individual expense for prescription drugs is $156 per year. Once these sums are met, care is covered at 100%. __________________________________ UNITED STATES The United States has a population size of about 281,421,906 - more than twice the number of people who live in Japan. Its infant mortality rate is 6.82 per 1,000 live births, and life expectancy at birth is 74.24 years for men and 79.9 years for women. Per capita GDP is $33,900, of which 12.9%, or $4373 per person per year, is spent on health care. Today, the U.S. is overwhelmingly dominated by the private health care market (20% HMO's, 50% other managed care, 30% other), and the role of government is generally kept to a minimum. Its pluralistic health care system also includes Medicare (government insurance for the elderly), Medicaid (government insurance for the poor and disabled), voluntary health agencies, and enterprises with health functions. The U.S. health system is financed primarily through private insurance agencies. As such, over 60% of all U.S. health expenditures come from private sources (i.e., personal income). Primary care physicians act as gatekeepers, and are generally reimbursed by a fee-for-service system. The patient frequently pays for primary care service out of pocket. Specialists are not restricted to hospitals and are paid via fee-for-service. ___________________________________ Conclusions Above, the US has not been compared to countries such as India, where the infant mortality rate is around 60 per thousand and the life expectancy is 62.5 years for men; 64.3 for women. In Kenya, the infant mortality is a little better than India's, and the life expectancy decidedly worse - less than 50 for both men and women - because of traditional tropical diseases combined with AIDS and compounded with poverty. These countries do not have anything like the resources of the US, so we can't learn much from that comparison. The US, while the wealthiest country in the study, has been compared with similar countries (except for Cuba), to illustrate what is possible here in the US. By now, if the examples haven't convinced you that the United States is wasting about half the money it puts into health care, nothing will. People who try to claim that "free-market competition" is the best way to control health care costs just don't know the facts. The fact is, the US Medicare program has overhead administrative costs of less than 5%, while the private insurance companies have overhead costs in the 20-25% range. This clearly demonstrates that the efficiency of the marketplace is in this case just a myth. However, simple inefficiency in administration is inadequate to explain how so much money is wasted in American health care. First off, let's define "waste" in this context. If you don't need to spend money in some particular manner to get good health care, then money so spent is wasted. Private insurance companies, in addition to overhead expenses, must have profits, so some of the money paid for health care goes to these profits. They also have executive salaries and perks that would not be tolerated in a government agency, salaries and perks that are not needed (as we see in the example of numerous other countries) for purposes of delivering health care, and so this money is also wasted. But it is not just profits and perks. Private insurance insists on reviewing every procedure, and contesting a great many of them. This takes time, personnel, and money, and is a way of delaying health care, not delivering it. Doctor's offices and hospitals are compelled to carry a matching staff to fill out forms, make and return phone calls. Doctors and nurses find much of their time consumed in the same process. All of this costs money, and this money is wasted, as the administrative conflict is almost entirely unnecessary. Medicare has no money in its budget to lobby Congress or pay for TV ads during election campaigns. The private health insurance industry uses millions this way. If it does not pay for health care, it is wasted money. The other big institutional offender is the drug industry. Americans pay the highest prices in the world for drugs. Drug companies use the money for advertising, lobbying, campaign funds for pet politicians, executive salaries and perks, and still have enough left over to report a high rate of profit. This rate of profit is either splendid or obscene, depending on your view of stock profits and prices; it is certainly not necessary to pay the costs of developing and producing drugs. All of the extras above the cost of producing drugs and a reasonable rate of profit is wasted, compared to the practices of most other countries. It is no secret that when a national health system which buys all the drugs from all the manufacturers for even a small country negotiates prices with drug manufacturers, the result is reasonable drug prices. It is also no secret that when drug companies deal with dozens or hundreds of insurance companies and with the millions of atomized individuals paying out of pocket, ridiculously high drug prices result. That's why Americans increasingly buy drugs from Canada. The drug companies and the insurance companies are tied together by the laws of this country and the politicians who make the laws. The companies see a stream of money, in the Social Security and Medicare programs, which they wish to turn into profits and perks for themselves. They are literally paying politicians to make this happen, and running commercials to enhance the myth of "competition in a free market" to get us to accept it. The collusion among insurance companies, drug companies, and politicians to put their profits above our health care is vulnerable on the political side of this triangle, if we refuse to let them buy our votes. If we vote against every incumbent who takes money from these industries, we have a beginning. If we decide to organize to vote against every incumbent who is not vigorously in favor of universal health care, we have a path to follow. This may sometimes mean voting out a half-decent candidate and getting a worse one in, and having to vote that one out in the next election cycle. It's not a smooth path or a perfect outcome, but we have to demand universal health care in a language politicians understand. Once they understand they have to give us universal health care or they are out, we win. If we settle for expressions of sympathy and gestures of support without real action, we lose. The choices are ours. __________________________________ "Rats and roaches live by competition under the laws of supply and demand. It is the privilege of human beings to live under the laws of justice and mercy." - Wendell Berry