The United States spends more on healthcare than any other industrialized nation. But, this is one case where the economic tenant of “you get what you pay for,” does not seem to hold true. That is because all of that extra spending does not seem to result in better access to healthcare, or better outcomes for Americans.
A study published last week in the latest edition of the Journal of the American Medical Association (JAMA), found that the U.S. spends more money than any other country on healthcare, yet life expectancy is shorter, obesity is higher, and the rate of maternal and infant death is higher as well.
So where is all that money going? That is something the study was trying to find out, and the results may surprise you.
Researchers at Harvard University analyzed data from international organizations on types of spending and performance outcomes between the U.S. and other high-income countries: Canada, Germany, Australia, Japan, Sweden, France, Denmark, The Netherlands and Switzerland.
By comparison, one of the main drivers of the high healthcare costs in the U.S. is the cost of brand name prescription drugs. The researchers found that in the U.S. people spend – per person – nearly double on prescription drugs — $1,443 – as compared to the average of other countries which is $749.
The researchers also found that the US spends more but covers fewer people. In 2016, while only about 90 percent of the population had healthcare coverage, the U.S. spent about 18 percent of its GDP on health care. Other countries spent much less of their GDP on health care, ranging from 9 percent in Australia to 12 percent in Switzerland — while they had more than 99 percent of the populations with health care coverage.
All in all, the researchers concluded that, contrary to popular belief, healthcare utilization – or how many people are going to doctors, hospitals and other using the healthcare system — was not the most important factor in the differences between US spending and the spending for healthcare in the other countries compared. Instead, they said that two-thirds of the difference in healthcare costs between the U.S. and other countries were rolled up into medication costs, expensive tests and procedures and administrative costs.
Statistics Do Not Tell the Whole Story
While the JAMA study is one in a long line of studies that do indeed say that Americans spend more on healthcare and yet do not have better outcomes and indeed die younger than in other countries, those numbers do not tell the whole story.
For example, Americans live for 78.8 years, on average — less than the citizens of the other developed nations examined in the JAMA study.
However, several factors unrelated to our healthcare system explain Americans’ poor life expectancy. Our nation’s rate of gun deaths, for example, is ten times higher than that of other wealthy countries. Our death rate from car crashes is more than double that of other high-income nations. The U.S. drug overdose death rate is higher as well; Americans are twice as likely as Brits and six times as likely as the French to die of overdoses.
Americans are also heavier than citizens of other nations. More than 70 percent of U.S. adults are either overweight or obese, which increases their risk of premature death.
None of these factors reflects on the quality of America’s doctors or hospitals. Yet they all contribute to our low life expectancy.
The U.S. healthcare system isn’t perfect. But it’s irresponsible to blame it entirely for our nation’s comparatively low life expectancy, high infant mortality, and other greater degree of poor health as found in the JAMA study — without acknowledging the societal factors behind those problems.