Comparing US and foreign health systems ignore foundational issues

Comparing US and foreign health systems ignore foundational issues
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In a recent opinion post in The Hill, the author compares U.S. and Swiss health-care systems to explain how government policy changes could produce better outcomes for patients, those who care for them, and those who pay their bills. However, I believe there are factual errors in the piece that ultimately confuse the issue.

When we talk about health care, most policy solutions are short-term, superficial fixes that redistribute the cost burden but ignore the root problem: affordability of care. While coverage and access to care are pain points for most, the pain itself can only be addressed with more affordable care.

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The aforementioned piece inaccurately stated that Swiss health care is more expensive than the U.S. health care. When comparing costs between Swiss health care and U.S. health care, the U.S. actually ranks worse than Switzerland according to two of the well-accepted measures of cost (per capita health care spending and percentage of GDP spent on health are).

 

In 2016, per capita health care spending was $9,900 in the U.S. and $7,900 in Switzerland, compared to the OECD median of $3,825. Additionally, the U.S. spent 17.2 percent of its GDP, compared to 12.4 percent for Switzerland and the 8.9 percent median for all OECD countries.

But health care costs are wildly above the median in both the U.S. and Switzerland, so the author’s comparison isn’t particularly instructive.

The bigger, more important issue is pretty straightforward: the U.S. currently spends too much on health care. A landmark article by Donald Berwick, the former administrator of the Centers for Medicare and Medicaid Services, estimates that we waste about $1 trillion annually – about a third of our health care spending — on health care.

The key question is: what can we do about it?

The Texas Medical Center Health Policy Institute in Houston just released the results of a 15-state survey of 9,200 consumers and a nationwide survey of 450 physicians.

We found that these huge health expenditures mean that about half the people we surveyed cannot afford their health care. Moreover, many people who have health insurance still can’t afford their health care. We asked insured respondents how much they could afford in “out-of-pocket” expenses, and the most common answer was 2 percent of their income.

Even among those earning $100,000 or more per year, almost three-fourths said they could only afford to spend 2 percent to 5 percent of their income on out-of-pocket costs.

Interestingly, this rate was virtually unchanged among those who are uninsured. A major problem is that lawmakers don’t recognize what everyday Americans consider affordable, so in the Affordable Care Act, “affordable” meant 8.2 percent of income.

We can improve affordability by addressing the root issue and reducing the cost of health care. How?

First, we should attack the estimated $200 billion spent annually on “over-treatment,” or health care that can’t possibly help anybody.

Studies show us that one way of attacking over-treatment is to salary physicians. Doctors who are paid fee-for-service — in other words, paid based on the volume of care they perform — order 9 to 33 percent more tests and procedures than those who are salaried.

We asked physicians how they would like to be paid, and 69 percent said entirely by salary or by salary with small incentives. This would seem to pave the way toward creating ways to nudge those who pay physicians to salary them, such as by adding a provision to the current CMS “value-based” payment scheme to pay a bonus to those paying the majority of their physicians by salary.

Second, we asked consumers and physicians how they thought we could decrease the cost of health care, and they largely agreed. Both groups favored increasing premiums for those who smoke and are obese; charging taxes for unhealthy foods and adding simple, easy-to-read health labeling on menus.

Third, both consumers and physicians also agreed that insurance companies should create affordable catastrophic plans that would pay for people in accidents, as well as treatment for chronic disease and pregnancy. The key word here is “affordable.” If these types of plan covered what was necessary, and large numbers of people bought them, the price would surely get us to the “affordable” range.

No current or proposed legislation has addressed the cost of health care for each American in a substantive way. Fortunately, our study offers solutions that could provide a roadmap for lawmakers.

Until we attack costs, we will not be able to afford health care for all.

Otherwise, it will be moving deck chairs on the Titanic. The reason we don’t have a Swiss health care system is because we aren’t Swiss. No comparison with Switzerland necessary.

Dr. Arthur Garson is a pediatric cardiologist, former medical school dean and director of the Texas Medical Center Health Policy Institute in Houston.