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Health Spending By Country 2011
Compared to other developed countries, the U.S. spends far more overall. In 2011, that was 17.7% of our entire economy (GDP) or about $2.7 Trillion, with more than half coming from private spending. And we still leave 50 million folks (16% of the population) uninsured and many more underinsured.

The next biggest spenders are France, Germany, Canada and Switzerland, which each spend only 11% to 11.6% of GDP and still manage to cover all their people.

If America would follow the lead of other civilized democracies by adopting a single payer Medicare-For-All system or by injecting fairness and pricing transparency into the private market so patients actually have buying leverage, we too could cover all our people and get health spending down to 11% to 12% of GDP. That would save a whopping $900 Billion per year! That’s more than current federal spending on Medicare & Medicaid combined.

And just think of what else you could do with the savings if your personal healthcare/insurance costs were cut by a third!

Health Spending By Country 1970-2011
While average per capita health spending has gone up for every country in the last four decades, it has skyrocketed in the U.S. We now spend more than twice the per person average of all other industrialized countries. In 2011, that was a whopping $8,500 per person.

This chart shows how U.S. healthcare spending started to peel away from the pack in — surprise, surprise — the deregulation days of Reagan. Then it takes off in the mid 1990s after Clinton’s failed attempt at major health care reform, while at the same time formerly non-profit health insurance companies started answering to Wall Street’s relentless profit demands.

The steepest rise in U.S. healthcare spending, however, clearly happens in the 2000s with Bush 2 and the pushing of tax-exempt health savings accounts (HSAs) paired with a high-deductible plan (euphemistically branded as “consumer-driven care”). Far from bending the cost curve down, this touted “market-based” approach helped fuel the escalating costs. The promise that people would be more prudent shoppers of health care when forced to spend their own money did not pan out.

As former CIGNA executive turned industry whistleblower Wendell Potter explains in his book Deadly Spin,

“...high-deductible plans are best suited for relatively young and healthy people who have a few dollars left over after they pay their bills. For the rest of the population, they frequently turn out to be a very bad deal.” (p. 112)
Potter recounts the story of a leadership retreat where a vice president of a large insurer was trying to explain the benefits of consumer-driven care to about one hundred of his colleagues:
“He was peppered with questions about how the plans could be a good deal for people with chronic conditions and people who didn’t have extra money to put in a savings account or otherwise meet high deductibles. After about thirty minutes of nonstop questions, he finally said, ‘Look, you’re just going to have to drink the Kool-Aid.’ That was the end of the Q&A” (p. 112-113)

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Comment Preferences

  •  "We're Number One! We're Number One!" (1+ / 0-)
    Recommended by:


    Anyone considering a dog for personal safety should treat that decision as seriously as they would buying a gun.

    by Dogs are fuzzy on Tue Aug 13, 2013 at 05:55:58 PM PDT

  •  Single payer, and drug price leverage (1+ / 0-)
    Recommended by:

    are a small part of the cost solution. Even if we had single payer, and had the government negotiate for drug prices that were the same as Europe or Canada, it would probably offset adding all the uninsured to the single payer program. It would have small net effect on total expenditures on healthcare and its share of GNP. What people don't seem to understand is that we teach and practice a completely different form of medicine in the US than they do in Western Europe and the rest of the first world. Until we change how we teach and practice medicine we will not make a material change in the cost of healthcare in the US. In addition, we pay our healthcare professionals much higher compensation than other first world countries with lower cost per capita healthcare costs. Those are the big drivers, not single payer, drug costs, health insurance CEO compensation, and most of the other reasons many people believe are the difference.

    I support single payer (with a few caveats), lower drug prices, and reasonable executive compensation but to think those would make a big net difference is an illusion. They would be beneficial but largely offset by adding all the uninsured into the system.  

    "let's talk about that"

    by VClib on Tue Aug 13, 2013 at 05:59:55 PM PDT

    •  MAJOR part of the solution (2+ / 0-)
      Recommended by:
      tardis10, Nailbanger
      In addition, we pay our healthcare professionals much higher compensation than other first world countries with lower cost per capita healthcare costs.
      This is true for some proceduralists. It isn't really true for generalists, at least if you are talking about comparison with Canada. The pay isn't that much different, and many docs would make more working in Canada than the US. (For some, this is only true after you net out the costs of paying your share of the administrative staff to deal with insurance companies and paying your malpractice.) It's been a little while since I looked, but for Family Medicine, Psychiatry, Pediatrics, and OB-GYN this was true.

      Doc pay is a small part of the picture.

      The estimates of the cost saving in single payer are considerably higher than you seem ready to give credit for. There is a huge amount of overhead and wasted physician time related to insurance companies (estimated as greater than 30% of total costs).

      Steffie Woolhandler and David Himmelstein have published the most on this subject, and their various scholarly and lay articles have never been successfully answered by opponents of single payer (so far as I've seen).

      (Disclaimer: I'm a PNHP member.)

      The plural of anecdote is not data.

      by Skipbidder on Tue Aug 13, 2013 at 06:34:18 PM PDT

      [ Parent ]

      •  Skip - let's call it a 30% savings (1+ / 0-)
        Recommended by:

        How many uninsured and underinsured people do we have in the US? If we add them into the mix without adding additional health care professionals who treats them and how would that impact the supply/demand for healthcare services? It will take a sustained significant investment by the federal government for at least ten years to add the physician capacity we would need to treat the uninsured and underinsured. I see no interest in the federal government to fund such an expansion of physicians, particularly in primary care.  Just as an aside there will not be enough physicians to treat all the new Medicaid patients that will be added with the ACA, and I see no recognition by the federal government of this fact.

        I will stipulate that when compared to Canada there may not be much difference for primary care physician compensation, but the comparisons are more stark for specialists and in Europe. And I am not an advocate of reducing physician compensation.

        However, I return to my main point. We just practice medicine is a different way here. That's why it costs so much more.

        "let's talk about that"

        by VClib on Tue Aug 13, 2013 at 06:52:33 PM PDT

        [ Parent ]

        •  OK. We're not really that far apart (1+ / 0-)
          Recommended by:

          Ah. I've reread your post.

          Adding the uninsured (and bumping up the coverage of the underinsured) seems like a big deal to me.

          I see that you've already actually included that.

          I think I think it to be a bigger deal than you do.

          The difference in pay for specialists is certainly true. I'm sometimes a specialist, but in areas that don't get paid that way. :)

          We do practice medicine differently here. I think that part of the reason for this is actual or perceived (and exaggerated) fear of malpractice claims.

          Regarding pay differences with Europe, part of the thing to remember is that school is mostly (or completely) paid for. I didn't make enough in my first 7 years of full time work as a doctor to cover the costs of my med school loans (if I had spent it on nothing else...not wasted it on things like food and shelter). I'd have happily traded a chunk of my salary down the line in order to not have that debt. This (and considerably better working hours) is what European docs get. I'd take that trade too.

          I had looked at the possibility of relocating my family to Canada after the 2000 election.  (Four adults. I would have been okay, and wouldn't have taken a pay hit. The nurse would have been very easy. The computer programmer would have been rough. The administrative assistant would have been near-impossible.)

          The plural of anecdote is not data.

          by Skipbidder on Tue Aug 13, 2013 at 07:16:04 PM PDT

          [ Parent ]

  •  With commodity medicine you loose even if you can (0+ / 0-)

    afford it.  When each healthcare provider is concerned with billing for their particular service there's no one left to take care of healing the patient.

  •  US Governments spend more and get less (1+ / 0-)
    Recommended by:

    Since we're talking about health care, using per capita data is more relevant than % of GDP but the message is the same. Here's a link to international health care data that then links to the same OECD data.

    U.S. governments are already spending 8.5% of GDP ($4,437 per capita in the Data Summary Table) on health care for the poor, the elderly, and government/military. Canada spends a smaller amount, I would guess 8% from the graph ($3,104 from the table) to cover 100% of the population. Message: if US governments enacted Canadian single payer with the same exact structure, government spending would go down 25% and coverage would increase to 100% (and notice I didn't mention anything about life expectancy or health outcomes which would presumably also improve).

    Since U.S. governments are already raising revenue/spending $4,437 per person, there is no need to increase taxes to pay for it.

    •  the cost of the for profit bureaucracy is more (0+ / 0-)

      than just the cost of that bureaucracy, it is the cost of all of us who have to fight the provider and the insurer over codes that who the fuck knows what they mean.  It means the doctor is distracted by his billing department.  
      It means every company has to have an HR department that negotiates with three or 4 insurers every year, and the workers have to listen every year about why they are so lucky that their premium is only going up 12 percent and their copays are only going up 5 dollars, and the secret formulary just cut out coverage for their life extending medicine.......
      there is no valid reason that the cost of an MRI in Spain and an MRI in California should $1000 apart.

      "Searches with nonspecific warrants were ‘the single immediate cause of the American Revolution.’” Justice Wm. Brennan, referring to the 4th Amendment

      by Nailbanger on Tue Aug 13, 2013 at 07:47:27 PM PDT

      [ Parent ]

  •  We spend much more and our "outcomes" are worse (0+ / 0-)

    50,000 die every year for lack of healthcare.

    700,000 go bankrupt due to medical bills every year (and 75% of those have "insurance")

    These two articles throw more light;

    21 graphs that show America’s health-care prices are ludicrous

    Health outcomes report cards, by country

    Interestingly, the U.S. is near the top (2nd) in self-reported health status–we say we’re healthy–but in all other measure we’re near the middle or bottom of the pack.

    Daily Kos an oasis of truth. Truth that leads to action.

    by Shockwave on Tue Aug 13, 2013 at 06:32:55 PM PDT

    •  but over 200,000 die from (0+ / 0-)

      preventable medical errors and hospital acquired infections.
      The biggest problem is not lack of care.

      I'm asking you to believe. Not in my ability to bring about real change in Washington ... *I'm asking you to believe in yours.* Barack Obama

      by samddobermann on Wed Aug 14, 2013 at 11:43:27 PM PDT

      [ Parent ]

  •  This whole U.S. system is messed up (1+ / 0-)
    Recommended by:

    People without insurance wait until they get sick and then go to the emergency room. They don’t see a doctor before things get bad, so they don’t get preventive care and advice. If you wait til there’s a health crisis, everything is gonna cost more.

    The hospitals are required to treat people in the E.R. (even if they can’t pay), so they raise the prices for everything. Even things like bandages and aspirins end up costing more.

    For-profit hospitals and for-profit health insurance add to the overall cost of healthcare. Obamacare is limiting the overhead to 20%. But something nationalized like the VA Hospital model would be much cheaper.

    Bureaucracy and paperwork add to the overall cost. I know a woman who works at a hospital and she spends all day every day contacting different insurance companies and asking, “If this patient has this test or this procedure or this length of hospital stay, are they covered?” There’s paperwork, phone tag, email tag, all just to get permission to do an MRI or whatever.

    There are various doctors who don’t take Medicare. Or they limit the number of Medicare patients. So patients have to call several doctors before they find someone who will see them (and good luck if you live in a rural area).

    The whole system is messed up. We should have one provider, one guarantor: the Government. Or just a socialized system.

    "Stupid just can't keep its mouth shut." -- SweetAuntFanny's grandmother.

    by Dbug on Tue Aug 13, 2013 at 07:36:03 PM PDT

  •  Ho hum, another diary about single (0+ / 0-)

    payer. This one is at least more fact based.

    Do you think this is news to anyone on this site?

    At least this one is not filled with vitriol against President Obama and various other perceived enemies.

    I'm asking you to believe. Not in my ability to bring about real change in Washington ... *I'm asking you to believe in yours.* Barack Obama

    by samddobermann on Thu Aug 15, 2013 at 01:25:25 AM PDT

  •  Those "young relatively healthy" people (0+ / 0-)

    Are obviously not women. They must be men, because women have lots of health care needs when young.

    Women create the entire labor force.
    Sympathy is the strongest instinct in human nature. - Charles Darwin

    by splashy on Sat Aug 17, 2013 at 03:31:55 AM PDT

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