We are on the road to recovery in health care- or are we? This year we passed two bills: the Patient Protection and Affordable Care Act (known as the “Senate bill”), and the “House Bill”, the Health Care and Education Reconciliation Act of 2010 (H.R. 4872). However, neither of these bills really reformed healthcare- but they did address the healthcare insurance issue.
It shouldn’t surprise you that health care is still going to be a big issue in the US. We spent some $ 7600 per capita on health care, which is some 250% of that for the OECD countries (on average, of which we are but one). We were spending about 16% of our GDP on health care (OECD average is 8.9%) , but with the Great Recession, it probably crept up more than that (GDP down, health care up). We spend the OECD level (as % of GDP) just for the elderly, disabled (Medicare), and poor (Medicaid, SCHIP). The other 7% comes from private (or no) insurance expenditures.
You might think that we spend at higher rates (based upon the Medicare information mentioned above) because of our elderly- but our elderly population is much lower percentage than that of Europe or Japan (13%, 17% and 22%, respectively). Insead, it’s our outpatient care and pharmaceutical costs. Our outpatient costs are roughly 3X those of Europe’s, and we have the highest same-day surgery rates around. Even more interesting is that generic drugs here cost the lowest anywhere and brand names the highest by far. Yet, even so, drugs costs as a percentage of total health care are lower than the rate in other OECD countries.
It’s our machines and their use that really does us in. MRI units and CT scanners are very expensive pieces of machinery- and they generally require special construction, to boot. We have twice the average number of MRI units (per capita) and 50% more CT scanners that the rest of the OECD countries. But, not only do we have more units- we use them more (even higher than the ratio of units per capita compared to the rest of the OECD). And, these are just two of our expensive devices.
It’s one of the reasons why these bills have a (not so hidden) tax included to pay for some of the health care reforms- a tax on each medical device sold. You may think that really won’t affect you- but the bill employs the FDA definition of medical devices- which includes such esoteric units like band-aids, thermometers, blood pressure monitors, as well as the things you originally considered like dialysis equipment, neurosurgical drills, and these scanners.
Don’t think for a minute that this tax is going to slow down our use of these expensive devices. They are too lucrative- for the doctors, for the clinics, and for the manufacturers. Yes, these devices can provide valuable information, but they are not making us healthier. We don’t live longer or have fewer health events that the other OECD countries.
The problem is we want the healthcare we want when we want it. But, how do we know we want it- we generally don’t pay the bill directly- or even see the prices involved (certainly never BEFORE we undergo the procedures).
We all remember the uproar over the recommendation to reduce the number of mammograms and prostate testing performed here in the states. But, if we are serious about reducing our health care costs, we are going to have to rely on evidence based medicine, thereby insuring we get the results we need at the price we want to (or can) pay.