Wednesday, June 7, 2017

Government, Private Prepaid & Out of Pocket Spending

Global Health Financing Patterns 1995-2014


SELECTED
COUNTRIES
RANKED  BY
TOTAL $ PER
PERSON
HEALTH CARE SPENDING 1995-2014
Total
Percent
Government
Prepaid Private
Out of Pocket
Annual
$ Per
Of
% of
$ per
% of
$ per
% of
$ per
%
Person
GDP
Total
Person
Total
Person
Total
Person
Change
USA
9237
16.6%
50%
4600
39%
3584
11%
1053
2.9%
Switzerland
7811
12.8%
60%
4710
15%
1187
25%
1914
3.2%
Luxembourg
7105
6.9%
84%
5961
6%
391
11%
753
3.2%
Norway
6537
10.0%
83%
5432
4%
242
13%
863
3.3%
Austria
5471
11.2%
78%
4267
6%
317
16%
886
2.6%
Sweden
5446
11.8%
85%
4635
1%
33
14%
773
4.0%
Germany
5356
11.2%
77%
4140
9%
503
13%
712
2.6%
Netherlands
5234
10.7%
88%
4627
6%
330
5%
277
3.9%
Denmark
5075
10.8%
85%
4304
2%
96
13%
680
2.8%
Belgium
4751
10.6%
78%
3701
4%
204
18%
846
3.3%
France
4589
11.3%
80%
3667
14%
624
7%
298
2.0%
Canada
4576
10.3%
72%
3299
14%
645
14%
631
2.4%
NewZealand
4050
11.0%
82%
3333
7%
267
11%
446
4.2%
Australia
4032
9.0%
70%
2839
10%
399
20%
794
3.3%
Ireland
4006
7.6%
68%
2708
14%
573
18%
725
4.6%
Iceland
3959
8.7%
82%
3258
0%
0
18%
701
2.3%
Finland
3935
9.3%
78%
3069
3%
122
19%
744
3.1%
UK
3749
9.1%
83%
3115
7%
266
10%
364
3.4%
Italy
3311
9.0%
77%
2563
1%
30
22%
718
1.8%
Spain
3096
9.0%
71%
2201
5%
149
24%
746
2.6%
Portugal
2697
9.3%
67%
1796
6%
159
28%
744
3.3%

Data Selected and Adapted from Global Health Financing: government, prepaid private, and out-of-pocket health spending . You may have to register with them, i.e. create a free account with your e-mail address to access this article.

On the face of it the USA has by far the most expensive health care per person ($9327), and the most expensive among the countries listed in terms of percent of GDP spent on health care (16.6%)

While the USA government provides only 50% of the total funding (all other countries listed provide between 60 to 88%) the amount per person from government funding ($4600) is more than the total spending per person of all but nine countries on this list!

The USA is dramatically different from all the other countries in prepaid private spending, e.g. insurance plans. They provide 39% percent of the spending, which is more than twice the percent of the country with the next highest percent, Switzerland.

The dollars per person of USA prepaid ($3584) is more than three times the next runner up (Switzerland again) at $1187. Obviously shifting the USA market from its present emphasis on prepaid private would be a great undertaking.

The USA percentage of total spending paid by out of pocket expenses (11%) is actually lower than 15 out of 20 of the remaining countries in the list.

However because of our high total spending, American out of pocket spending comes in second $1053 after the highest which is again Switzerland ($1914).  

Hopefully Unagidon will give us some help in understanding this data.

Methodology

We estimated national health spending by type of care and by source, including development assistance for health, based on a diverse set of data including program reports, budget data, national estimates, and 964 National Health Accounts. These data represent health spending for 184 countries from 1995 through 2014. We converted these data into a common inflation-adjusted and purchasing power-adjusted currency
-Summary

Government, prepaid private, and OOP spending data were from World Health Organization. These include all outlays for health maintenance, restoration, or enhancement paid for in cash or supplied in kind.

However it excludes indirect health spending, such as lost wages due to illness or transportation costs; spending on informal care, such as care provided by a family member; spending on traditional healers; and illegal so-called black market or under the table transactions, such as bribes.





7 comments:

  1. As far as I know, of the countries listed, the US is the only one in which medical care (outside of pharmacy) is a profit-making industry. How much of US expenditures go to profits for hospitals, providers of lab tests and technology (MRI, CAT, Xray etc), and to insurance companies, as well as to pharmacy. Our drug costs are higher than most.

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  2. Interesting that everywhere (except possibly Iceland) private insurance is available. I presume that covers uncovered things -- like cosmetic face lifts in countries that have standards -- and what we would call "secondary" insurance to Medicare. I find it interesting because I once spent a long drive listening to Rush Limbaugh describe in excruciating and loud detail how Obamacare was going to take away the wonderful private insurance policy he was proud and happy to pay for out of his earnings. Presumably the bloviator was in full pursuit of what we now call fake news.

    I have Medicare, and my former employer and I pay Aetna to cover what Medicare doesn't. Aetna's cost has already reduced my pension by approximately 1/8; I figure that if I live to 94 my entire pension will go to Aetna. I am not complaining. Most people who come after me will have no idea of what a pension is. Medicare, btw, takes a bit out of Social Security payments. And where I live, everybody pays taxes for a health care district that covers things that I believe are paid for (or not in, for example, Kansas) by the state. So even Americans who are retired on Medicare are paying a healthy chunk of current income for health care. And, again, I am not complaining; I have it good compared to he majority. I'm only rounding out the picture.

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    Replies
    1. Tom, why on God's green earth were you listening to Rush in the car on a long drive? Don't you know that your head could explode doing that?

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  3. My Icelandic friends are always complaining about their health care. The access to doctors, particularly specialists, is abysmal, and coverage is spotty. One of them tried to explain how it works, but it sounds positively byzantine. I was actually glad I lived here.

    I think the bottom line, though is that overall health care costs (first column) are highest in the U.S. because we are out of shape and demand more interventions.

    We are also conspicuous consumers of everything. Why not health care? I hear people talking about various medical procedures in what can only be called a tone designed to make other people feel envious.

    God help me, I am not immune. I can mesmerize our biology faculty with stories about my bone marrow for at least an hour. Ask me about my bizarrely hyperlobated megakaryocyte nuclei!

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  4. unagidon here. I'm sorry I didn't see this post earlier.

    The government share for the US looks low because there is a hidden non-tax subsidy of Medicare and Medicaid buried in commercial premiums. I spoke about this at some length in my last Commonweal article.

    Tom is partially right about the role of private insurance in systems with universal coverage. In addition to what he mentioned, patients with private insurance can also get some "comfort plus" stuff, like private hospital rooms where only a double is covered by the national insurance. Also, Western countries are not going to forbid providers who want to go into private practice (including the establishment of private hospitals) for people who don't like the public system for some reason.

    In the US, I would expect that private insurance would remain a strong component of a system of universal coverage. I haven't written about the before, but because businesses pay for commercial insurance and because providers are built around commercial payment structures, it would probably make political sense to leave that part of the system relatively intact, at least for a long time. I see something emerging that would be more of a "donut" model. Basic preventative care would be covered for all by the government. Catastrophic care (the really high end stuff) would also be covered by the government. People who have commercial insurance now would continue to get it for everything in between. And the poor would get Medicaid, but the reimbursement to the providers for it would be aligned with Medicare. And Medicare itself would be offered to people at a younger age; perhaps sixty to start.

    Over time, Medicare could be pushed down into lower ages and Medicaid pushed out to people with higher salaries until the two sides meet. In the meantime, people who have commercial insurance would still get what they are used to. A scheme to have the government cover the catastrophic stuff would be able to rely on a national risk pool, which would probably lower overall costs.

    Regarding Jean's comment on American's being out of shape, etc., I agree. The best "healthcare" is a decent lifestyle where one can afford adequate food and a decent minimal living. I think that this is on the decline in the US. Poor people eat badly because bad food is cheaper. It's as simple as that. And yes, we are conspicuous consumers. It's not so much that we like to advertise our illnesses, but that we think we need medical treatments for lots of things that really don't need a doctor. I think I mentioned in my Commonweal article that after the Great Recession, there was quite a drop in medical utilization. What I didn't really discuss was that there was a drop in people going to the doctor for small stuff, but also a drop in people getting preventative care. We in the insurance business watched this, half expecting that people avoiding the simple stuff would lead to an increase in more serious stuff that wasn't getting caught. But this didn't happen. I think we over-utilize. If we had a universal system, I would talk about this more. But the over-utilization argument has been mostly co-opted by libertarians (especially "Christian" ones) to argue that the problem with US healthcare is poor people trying to use it.

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  5. The single payer systems do not operate identically in all countries, nor are they equally good as far as things like access to specialists may go. But we really should be looking at the options since our healthcare system is not only the most expensive by far, it is way down on the list as far as outcomes go. It is also the only country I looked at in the west that had "medical error" as a leading cause of death (third in the US - after cardiac and cancer). Medical error was not even listed in the top 10 or 20 causes of death in the western European countries I checked.

    My husband had a stroke while we were in France, and we were plunged into the French healthcare system. The care was excellent. It was also affordable for a non-citizen/non-resident. My husband's bills for 8 days in the system came to about 5500 euros (about $6500 at the prevailing exchange rate), including emergency care, two more than an hour-long ambulance trips (one to access an MRI away from the emergency hospital he was first taken to,, one to transfer him to third hospital with better neurology than the first two. He had all the high tech tests (CAT, ECG, echo-cardiogram, MRIs etc). Different specialists were involved. Two days in a US hospital after coming home had (nominal) bills of about $70,000 (of course, the insurance comp. paid far less than that. But that is what we would have been expected to cough up if we hadn't had insurance). He was covered by his company's insurance even though in Europe, due to it being an emergency. But the French bills would not have landed us in bankruptcy court if the insurance hadn't covered it. A friend who needed stitches in her finger while in France paid $35 for the ER visit.

    Going home via London, a British flight attendant told us that he was "lucky" that it happened in France and not England, since the French health care system was "so much better". It's true, it is. I hear a lot of complaints from English friends about their system. The French system has been ranked #1 in the world more than once in recent years.

    For another American's experience, read this. It's almost unbelievable for those used to the American system. I would be interested in Claire's experiences. Perhaps one has to be in a major city to have the gold star treatment this family experienced.

    http://blogs.reuters.com/anya-schiffrin/2014/02/12/the-french-way-of-cancer-treatment/

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    Replies
    1. I am glad that Andre Schifferin got to die in France, where they know the value of small comforts (chicken dinner, I bet with a cloth napkin and non-plastic utensils, and a massage).

      I think healthcare must reflect the national personality.

      Pres. Obama talked feelingly about watching his mother with cancer spend some of her last days arguing with insurance companies. That's enough to make you want to die.

      The Brits are funny. They tend to try the stiff upper lip treatment first. To wit: A friend's hernia acted up while he was in London. He went to the hospital, and they gave him a truss. It actually worked fine. He enjoyed his trip and had surgical repair when he got home. Bob said that the truss looked like something from 1943. And knowing the Brits, it probably was.

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