BY STUDYING SUCCESSFUL UNIVERSAL HEALTH CARE SYSTEMS IN OTHER DEMOCRACIES …
In a January 2019 Pew Research Center poll, 69% of Americans say Health Care should be a top priority for the President and Congress.
Americans feel this way because Obamacare has failed. Health care coverage premiums and deductibles have risen through the roof while policy choices have been limited in most states to only one plan. Despite President Obama’s multiple promises that we could keep our doctor and our plan if we wanted to … most Americans didn’t because they weren’t allowed to. And the coup de grâce, 8.8 percent of Americans, or 28.5 million people, still do not have health insurance. Wasn’t the whole purpose of Obamacare to insure the uninsured?
The few remaining moderates in the Democrat party want to fix Obamacare, but most of the new, far-left Dems want to ditch it in favor of Medicare For All.
The White House and Congressional Republicans support repeal and replacement of Obamacare, but they have yet to articulate a Plan B that Congress can pass into law.
The conservative-Republican knee-jerk reaction to any Democrat proposal for government-run health care is to cry “Socialism!” But we believe Republicans should first do their homework on successful universal health care systems in other democracies with free economies before completely dismissing the idea. And we know which countries to study.
But first, let’s review the following data and explanations from the Peterson-Kaiser Health System Tracker to demonstrate why Americans are not getting a good bang (quality health care and preferred medical outcomes) for the buck (government spending of our tax dollars).
Health care spending in the U.S. totaled $74.6 billion in 1970. By 2000, health expenditures had reached about $1.4 trillion, and in 2017 the amount spent on health had more than doubled to $3.5 trillion. Total health expenditures represent the amount spent on healthcare and health-related activities (such as administration of insurance, health research, and public health), including expenditures from both public and private funds.
On a per capita basis, health spending has increased over 30-fold in the last four decades, from $355 per person in 1970 to $10,739 in 2017. In constant 2017 Dollars, the increase was almost 6-fold from $1,797 In 1970 to $10,739 in 2017.
The chart below shows how U.S. healthcare spending compares to other OECD countries that are similarly large and wealthy (based on GDP and GDP per capita). The analysis looks at 2017 health data from the OECD Health Statistics database and the National Health Expenditure Accounts. As would be expected, wealthy countries like the U.S., tend to spend more per person on health care and related expenses than lower income countries. However, even as a high income country, the U.S. spends more per person on health than comparable countries. Health spending per person in the U.S. was $10,224 in 2017, which was 28% higher than Switzerland, the next highest per capita spender.
Comparing health spending in the U.S. to other countries is complicated, as each country has unique political, economic, and social attributes that contribute to its spending. Because health spending is closely associated with a country’s wealth, the next two charts compare the U.S. to similar OECD countries – those that have above median national incomes (as measured by GDP) and also have above median income per person. The average amount spent on health per person in comparable countries ($5,280) is roughly half that of the U.S. ($10,224).
Over the past four decades, the difference between health spending as a share of the economy in the U.S. and comparable OECD countries has widened. In 1970 the U.S. spent about 6% of its GDP on health, similar to spending by several comparable countries (the average of comparably wealthy countries was 5% of GDP in 1970). The U.S. was relatively on pace with other countries until the 1980s, when its health spending grew at a significantly faster rate relative to its GDP. In 2017, the U.S. spent 17% of its GDP on health consumption, whereas the next highest comparable country (Switzerland) devoted 12% of its GDP.
So with all that spending, U.S. health care must be achieving better results than those other comparable countries, right? Unfortunately, no. The U.S. has the worst amenable mortality (deaths from a collection of diseases, such as diabetes and appendicitis, that are potentially preventable given effective and timely health care) and rates of medical / medication / lab errors. Surprisingly, even the time to access a doctor or nurse for medical care is only average.
Now let’s look at the level of economic freedom and type of government in comparable countries who are managing to provide more efficient and higher quality health care coverage to all of their citizens.
As you can see in the chart below, all 11 countries ranked higher than the U.S. in economic freedom by the conservative Heritage Foundation have Universal Health Care. Ten of those countries are democracies, so it is a misnomer to say that only socialist countries provide universal health care.
As Forbes magazine put it: “Ten nations freer than the United States have achieved universal health coverage. It turns out that the right kind of health reform could cover more Americans while increasing economic freedom.“
Interestingly, in the 2019 STC Health Index, America is the only country in the top 100 that does not offer its citizens both universal and free health care.
STC-Health-Index-2018Democratic-socialists like Alexandria Occasio-Cortez and Bernie Sanders have touted the myth of “Nordic (Scandinavia, Finland, Iceland) Socialism” by creating confusion between socialism, meaning government control or ownership of businesses, and the welfare state with government-provided social safety net programs. Quoting Forbes again, “To the extent that the left wants to point to an example of successful socialism, not just generous welfare states, the Nordic countries are actually a poor case to cite. Regardless of the perception, in reality the Nordic countries are mostly free market economies paired with high taxes exchanged for generous government entitlement programs.”
In the chart below, we devised a ranking of the countries with the highest combined scores for economic freedom, general health conditions, and health care spending. Like golf, low scores are better. The countries shaded in green are those the U.S. should study and emulate. Australia, New Zealand, Singapore, Hong Kong, Switzerland and Iceland are all economically freer than the U.S. and have the top six combined scores. (We stopped at six because Canada has a government-run, single-payer health insurance system with long wait times, restricted access to the latest technology, and fiscal challenges.)
So what are the right kind of health care reforms? “Some people believe the reason why U.S. government health care is so big already, without achieving universal coverage, is that we heavily subsidize health coverage for Americans with high incomes, while leaving many Americans with low incomes unsubsidized. If we had a true safety net, in which we helped the poor and sick get coverage—while letting the wealthy buy health care in the free market—we’d spend a fraction of what we do today,” according to Forbes. We’re not policy experts, but that sounds like a logical starting place.
Through analysis we have identified countries who are offering affordable, high quality universal health care in democracies with free economic systems.
To Republicans and moderate-Democrats: Don’t be arrogant or obtuse. Study and steal best practices from these countries and Make America (health care) Great Again!