U.S. Health Care—Spending More and Living Less

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Not the best health care system money can buy.

A new study by Columbia University researchers Peter Muennig and Sherry Glied in the journal Health Affairs, according to the study's press release, disturbingly found:

While the U.S. has achieved gains in 15-year survival rates decade by decade between 1975 and 2005, the researchers discovered that other countries have experienced even greater gains, leading the U.S. to slip in country ranking, even as per capita health care spending in the U.S. increased at more than twice the rate of the comparison countries. Fifteen-year survival rates for men and women ages 45 and 65 in the US have fallen relative to the other 12 countries over the past 30 years. Forty-five year old U.S. white women fared the worst—by 2005 their 15-year survival rates were lower than that of all the other countries. Moreover, the survival rates of this group in 2005 had not even surpassed the 1975 15-year survival rates for Swiss, Swedish, Dutch or Japanese women. The U.S. ranking for 15-year life expectancy for 45-year-old men also declined, falling from 3rd in 1975 to 12th in 2005,

The study controls for possibly confounding factors such as differentials in smoking, obesity, accident and homicide rates, and ethnicity. So how bad is it? The study authors don't provide the raw data, but eyeballing their graphs in the article and appendix provides a rough idea of the magnitude of changes in survival rates that occurred between 1975 and 2005.

For example, in 1975, the 15 year survival rate for U.S. women at age 45 was about 91.5 percent. It was then the lowest of the 13 industrialized countries included in the study. By 2005, that had increased by 2.5 percent to about 94 percent. In 1975, the average for the 12 comparison countries appears to have been about 93.3 percent, rising by 2.9 percent to a bit over 96 percent. It remains the lowest 15 year survival rate.

For men, in 1975, 84.7 percent of U.S. 45-year old males survived 15 years, rising by 5.7 percent to just over 90 percent by 2005. In 1975, the comparison country average appears to have been 87 percent, rising by 6.3 percent to around 93 percent in 2005.

With regard to 65 year old American women, about 63 percent survived 15 years in 1975, rising 7.7 percent to around 71 percent in 2005. In 1975, the comparison country average was about 60 percent, rising a remarkable 17.4 percent to average 77 percent in 2005.

And for 65 year old American men, about 43 percent survived 15 years in 1975, rising by 17.6 percent to just over 60 percent in 2005. In 1975, the comparison country average was about 40 percent, rising by 21.6 years to around 62 percent.

In the meantime, the study shows that U.S. per capita health spending increased at nearly twice the rate in other wealthy countries. Consequently, the U.S. now spends well over twice the median amount of industrialized nations on health care, and far more than any other country as a percentage of its gross domestic product. So why are we doing so much worse relatively speaking? Muennig and Glied opine:

We speculate that the nature of our health care system—specifically, its reliance on unregulated fee-for-service and specialty care—may explain both the increased spending and the relative deterioration in survival that we observed. If so, meaningful reform may not only save money over the long term, it may also save lives.

Muennig and Glied are clearly supporters of some sort of universal government-run health care scheme, so they do not explore how our fragmented system evolved into the inefficient, dysfunctional mess that we all enjoy today. For future research, I suggest that they might profitably investigate the inefficiencies produced by third party payments, a health insurance market fragmented into 50 fiefdoms, the practice of defensive medicine, regulations designed to prevent competition, the the lack of incentives for patients to comparison shop, and so forth. That might result in truly "meaningful reform."

Hat tip to Mark Sletten.