Americans spend more on health care but get less

U.S. has fewer doctors than other countries, fewer doctor visits, more use of technology and pharmaceuticals

Oct 09, 2015 | By Jack Craver

A new report from the Commonwealth Fund strongly suggests that Americans are suckers.

Or, to be more specific, the report details that Americans spend far more on health care than other countries but with significantly poorer outcomes. 

The United States spends 17.1 percent of its GDP on health care, a far greater percentage than other developed countries.

The fee-for-service model that's served us for so long is being replaced with different models, ones that typically move some...

Number two on the list is France, which devotes 11.6 percent of its economy to health care, only slightly more than most other countries examined by the report. At 8.8 percent, the United Kingdom spends the least on health care of the countries examined by the report. 

But it wasn't always this way.

The same report shows how U.S. health care spending was on par with the rest of the developed world in 1980, when health spending accounted for roughly 8 percent of GDP.

While most other countries have increased the percentage of GDP spent on health in the past 35 years, they haven't shifted anywhere near as much as the U.S., which has more than doubled its financial commitment to health. 

For starters, the U.S.'s unique system of insurance means that much more of the cost of health is borne by the private sector. The average individual in the U.S. spends $1,074 out-of-pocket on health care a day, a figure greater than that of all countries except Switzerland. 

But even more baffling, the U.S. also spends more in public funds on health care than countries that guarantee coverage for all citizens through a single-payer system.

The U.S. spends $4,197 per capita in public monies, compared to $2,802 in the U.K., $3,247 in France and $3,677 in Germany. 

But in addition to individual and government expenditures on health care that exceed that of most other countries, the U.S. also boasts another significant source of health spending that hardly exists elsewhere. In the Commonwealth study it is referred to as "other," and it refers to the spending by employers and insurance companies. 

While "other" entities in the U.S. spend an average of $3,442 per capita on health, the same entities spend an average of $654 in Canada, the country with the next highest average in the category.

In Denmark and Sweden, both of which spend less in public funds per capita on health than the U.S., other entities spend an average of $88 and $53 per capita, respectively. 

It's even harder to understand why Americans spend more on health care after looking at data that shows that we use and benefit from health services far less than those in other countries. 

For instance, compared to the Japanese, who averaged 12.9 physician visits per year in 2012, Americans only visit the doctor an average of 6.5 times per year.

The U.S. also has fewer doctors than most other developed countries, with only 2.6 per 1,000 people, compared to the 3.2 average across the OECD. 

Commonwealth attributes the U.S.'s particularly high health spending more to the use of technology, rather than routine doctor visits.

Americans also consume more prescription drugs than anybody else. 

"High health care spending has far-reaching consequences in the U.S. economy, contributing to wage stagnation, personal bankruptcy, and budget deficits, and creating a competitive disadvantage relative to other nations," says the report, which suggests that outcome-based health spending could offer a possible solution to the problem. 

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