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How Health Care Systems from Around the World Compare to the U.S. Insurance Industry

The United States is locked in a fractious debate about the future of the American health care system. In the U.S., health care is controlled by private insurance companies. The U.S. spends more money per person than any other developed country, $8,508 in 2011. Health care spending was 17.6 percent of GDP in 2012, but many people boast that these expenditures provide Americans with the best health care in the world. Democrats and Republicans have vastly different views about health care and what constitutes true “access” to care. During this contentious debate about health care reform, it is helpful to compare the American system with health care systems in other countries.

A 2013 Commonwealth Fund report measured how health in 13 countries compared to health care spending, use of services, prices, and health outcomes. Despite the high average cost of care, America’s life expectancy, infant mortality rates and management of chronic conditions lagged behind other Western nations. Most of the data are for 2013, and so predate the major insurance provisions of the Affordable Care Act (ACA). America ranked last in life expectancy, behind Australia, Canada, Denmark, England, France, Germany, Japan, Italy, the Netherlands, New Zealand, Norway, Sweden, and Switzerland.  Worldwide, the U.S. ranked 45th in life expectancy in 2015. Although the average American lives almost eight years longer now than they did in the 1970s, life expectancy is growing at a slower pace than it is in other countries.

The Commonwealth Fund investigation concluded the American health care system distributes benefits unevenly and inconsistently, with “cost-sharing provisions in private health insurance plans” varying widely. Moreover, the Fund described the American health care safety net as “[a] variable and patchwork mix of organizations and programs deliver care for uninsured, low-income, and vulnerable patients.”

Perhaps no other measure reveals the accuracy of the Commonwealth Fund’s assessment more than infant mortality rates. The Centers for Disease Control reported in 2014 that America had a higher infant mortality rate than 27 other wealthy nations. Although the differences in how infants are registered account for some of the differences, it does not resolve the gap. When the difference in statistical measurements between the countries is accounted for, the CDC and the OCED found that the mortality gap between the US and other countries grows as babies age. The infant mortality rate for children born to low income and African American mothers is more than double for babies born to white mothers. Like the findings regarding life expectancy and chronic conditions, these results long predate the ACA. (America’s infant mortality rate ranked 16th in 1982).

Americans have strong opinions about their own healthcare, but typically lack specific facts about alternative health care systems. Since there are so many myths about health care around the world, let’s examine the best systems that the rest of the world has to offer.

France

The World Health Organization (WHO) ranked France first in its survey of health care systems back in 2010. French citizens have universal health care coverage that is provided by the government. In France, health care is paid for by the citizens who make income-based contributions, similar to the U.S. taxation system. The French government then reimburses citizens for about 70 percent of most medical bills. Choice is a key component of the French system. The citizens can visit any provider they want. Almost 45 percent can see a doctor on the same-day they request one.

For the balance of the 30 percent that is not covered by taxpayer money, most citizens in France buy supplemental insurance through public or private providers. Some employers offer the supplemental insurance, similar to the way American employers offer health coverage.

Some criticize the high amount of government spending, since the French health program often runs over its budget. The French government spends around $3,300 per person on health care, whereas the US spends more than twice that amount. For their $3,300 the average French citizen receives generous health care. According to a study of 19 industrialized nations, France wound up with the lowest number of deaths that could have been prevented through basic health care. In contrast, America had the highest number of deaths that were preventable.

France ranks highest in taking care of its sickest citizens. Those who have a serious condition like cancer will have the total cost of care covered by the government, even if the person needs experimental drugs or risky surgeries. Since prevention helps lower costs and provides better outcomes, the French focus on providing great care early. Mothers receive paid maternity leave, and even new mothers who are lower income get financial incentives to make prenatal screenings and early childhood appointments.

Germany

In Germany, the government requires all citizens to have health insurance. The insurance is purchased from private non-profit funds. Choice is good in Germany, with about 200 plans to pick from. No plan can deny coverage based on a pre-existing condition. In order to pay for the system, citizens pay an 8 percent tax on their salary into a sickness fund and employers must match it. This means that cost of health care in Germany is based on income. For German citizens who cannot afford insurance, public assistance is available. Meanwhile, children are covered by taxpayer funds. Although the wealthiest ten percent of Germans can opt out of the system and chose a for-profit plan, the non-profit plans are still robust, providing for benefits like time at a spa for patients who are recovering.

The Germans, like most other nations, cover all health care costs for children until they are 18 years old.

Germany has created influential series of disease management programs. Germany discovered that when patients got more time and counsel from doctors, along with regular follow-up calls by nurses, outcomes were very successful. The rates of hospital admissions and deaths related to certain conditions that can be managed, like diabetes and heart diseases, were lowered substantially by these contacts.

The main complaint about the German system is that doctors often feel underpaid. German doctors get a quarterly budget that is determined by how many patients they see, rather than receiving money according to how many tests ordered or appointments paid, as they do in the U.S. German citizens give the system high marks for accessibility and wait times. 

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