Healthcare Myth #1: More Expensive Care Must Be Better Care

Its true that the United States has the most expensive health care in the world. We spend more per person than any other country in the world, and more than double the average for comparable wealthy countries.

But cost does not equal quality.

Across a number of measures, the U.S. lags behind similarly wealthy OECD countries (those that are similarly large and wealthy based on GDP and GDP per capita).In some cases, such as the rates of all-cause mortality, premature death, death amenable to healthcare, and disease burden, the U.S. is also not improving as quickly as other countries, which means the gap is growing.

Let us take a look at where those healthcare dollars go. To the healthcare providers? Traditionally, and intuitively, that’s where it should go. But the percentage of healthcare spend has shifted away from the providers and toward facilities, pharmaceutical companies, insurance companies, and more recently healthcare technology companies.

It’s true that over-all mortality due to diseases continues to improve, but it does in those other countries, and in fact they are improving at a faster rate.  So perhaps, we need to look toward their models if we want to get better care at reasonable cost.

The countries that out-perform the U.S. are not sharing the same model.  However, they do have some things in common.  Not only do they have a relatively higher spend toward providers over administration, but more dollars are spent toward primary care.  Primary care providers tend to use fewer tests, spend less money, and protect people from overtreatment more than do the subspecialists from whom people seek routine care.

When you make primary care your first line of defense you can expect: 

  • 35% fewer hospitalizations
  • 65% fewer ER visits
  • 66% fewer specialist visits
  • 82% fewer surgeries

 

 British Medical Journal, 2013

https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsHistorical.html

Kaiser Family Foundation analysis of data from OECD (2017), “OECD Health Data: Health status: Health status indicators”, OECD Health Statistics (database). (Accessed on March 17, 2017).  Get the data  PNG

 United States Bureau of Labor and Statistics: https://www.bls.gov/

Greenfield S , Nelson EC , Zubkoff M , Manning W , Rogers W , Kravitz RL , et al. Variations in resource utilization among medical specialties and systems of care: results from the Medical Outcomes Study .JAMA . 1992 ; 267 ( 12 ): 1624 – 30 . CrossrefMedlineGoogle Scholar

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