DECEMBER 9, 2009 3:40PM

Expensive health care is not always the best health care

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A report published by the Organisation for Economic Co-operation and Development (OECD) documenting an international comparison analysis about the quality of health care was just released yesterday. Since I have to pay to obtain a copy of the report (only accredited journalists can obtain it for free), you won’t be able to benefit from my extensive reviewing skills.

Not everything is lost however, as other people (paid journalists) were able to read or glimpse at the original report.

For instance, Jessica Zigmond from Modernhealthcare.com provided the following highlights:

"A new report from the Organisation for Economic Co-operation and Development shows the U.S. spent about 16% of its gross domestic product on healthcare in 2007, much more than the OECD average of 8.9%. Following the U.S. were France, Switzerland and Germany, which, respectively, spent 11%, 10.8%, and 10.4% of their GDP on healthcare services.

The U.S. also ranks far ahead of other countries in per-capita health spending, as the country spent $7,290 per capita in 2007, a figure that is nearly 2½ times the OECD average of $2,984 for that year. Those numbers account for purchasing power parity.

According to the report, the public sector is the main source of health funding in all OECD countries except the U.S. and Mexico; in all other OECD nations, 73% of health spending was funded by public sources in 2007, while 45% of health spending was publicly funded in Mexico and the U.S. that year. All countries need improvement in quality, the report noted, and the U.S. is no exception. For example, avoidable hospital admissions for asthma and diabetes complications are more than two times greater in the U.S. than the OECD average.

The report also cited some areas in which the U.S. outperformed other nations, such as cancer care, with the U.S. achieving higher rates of screening and survival from different types of cancer than most other developed countries."

In short, the OECD report shows that the United States is basically at the bottom of list on the health care delivery front, especially given the amount of money that is invested in the health care system.

There is one exception and this is related to the treatment of various types of cancer (which is almost at par with the Canadian health care system, as seen below).

This report also supports another one published last month by the Conference Board of Canada (CBC). The main conclusion of the CBC report is as follows:

Canada ranks 10th among 16 comparator countries and earns a “B” grade in the Health report card. Canada outshines the United States, the worst performer this year, but still trails the global leaders in the overall health of its population.

As discussed on the OECD website and in the CBC report, there is place for a lot of improvement (I also touched this subject earlier), but Canada is still doing much better than the US on health care delivery.

Below are some figures that have been made available for the public (taken directly from the OECD website).

Figure 1 shows that the United States spends the most on health care with about $7,290 per person, which is about 90% (or double) higher than the value estimated for Canada. I’m glad to see that my previous calculations for health care spending in Ontario and Quebec, as described here and here,  are almost equal to the estimated value shown in this table (after we include public fund transfer from the federal government). Good on me!
 

Figure 1

  Figure 1. Total Health Care Expenditures per Capita (2007)

Figure 2 below illustrates the admission rates at hospitals for Asthma attacks for people aged 15 and over. In this case, the US arrives dead last, as discussed above.

Figure 2

Figure 2. Asthma Admission Rates, Population Aged 15 or Above (2007)

The last two figures illustrate where the United States performs most admirably: breast and colorectal cancer survivability. Interestingly, there are almost no statistical differences between Canada and the US (5% level), as seen by the 95%-percentile confidence intervals (the values represented by the H). The intervals almost overlap each other. This means that Canada still does very well with the treatment of these two types of cancer. However, cancer  survivability rates in Canada are not as great as it should be, as documented in the CBC report (see section on cancer).

Figure 3

Figure 3. Breast Cancer Five-Year Relative Survival Rate (1997-2002 and 2002-2007)

 

Figure 4

Figure 4. Colorectal Cancer, Five-Year Relative Survival Rate (1997-2002 and 2002-2007)


There you have it, folks! Till next time…

Update (January 30, 2010)

I recently found this very good article, which basically arrives at the same conclusions as the OECD report above:

Canada's Health System Compared with Health Systems of Other Industrial Democracies by Dr. Marilyn Bowman from SFU. (published: Fall 2009)

Here are the main conclusions of the paper:

In the specific comparisons with US health status, the data show that across virtually all the major indicators of health, Canadians are considerably better off. In a 1997 international comparison by The Economist Intelligence Unit, Canada ranked 4th in general health among 27 developed countries, compared to 13th for the US.  Canadians have better physical and mental health than Americans (Kessler, Frank et al. 1997), and in particular, poor Canadians have better health than poor Americans (Ross, Wolfson et al. 2000).

Significantly, in Canada mortality is not correlated with income inequalities as it is in the U.S. (Wolfson, Kaplan et al. 1999), and cancer survival rates are correlated with income in the U.S. but not in Canada (Gorey, Holowary et al. 1997). The better health of Canadians relates to the significant national Canada's Health System Compared with Health Systems of Other Industrial Democracies difference: the use of taxes for universal health care, which has been in effect since 1970.

Update (February 7th, 2010)

Last Friday's edition of the PBS NewsHour had a segment on health care costs in the U.S. As of 2009, 17 percent of the U.S. economy is entirely devoted to health care. The U.S. health care system is almost on the verge of bankruptcy: Health Care Spending Continued to Climb in 2009.

Update (March 1st, 2010)

 

This latest post summarizes the key issues I have been discussing over the last year. I also included a detailed example to support the discussion points.

 

The case against the U.S. health care system 

 

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The five-year survival rates prove nothing. The more you you screen for cancer, the higher the five-year survival rate will be, for two reasons:

1) You catch lots of slow-growing "cancers" which never would have bothered the patient until he died of something else, and

2) You detect fast-growing cancers earlier but the patient dies at the same time anyway.

Whenever people start talking about five-year survival rates as evidence of the supposed superiority of the US health care system, that means one of two things: either they aren't being honest with you, or they don't know what the hell they are talking about.

The only statistic that means anything in this context is the death rate. And while it's true that our death rates for breast cancer and prostate cancer are a TINY bit lower in the US than in Canada or the UK, the OVERALL death rate is higher. So that just means that Americans are dying of something else before they die of breast cancer or prostate cancer. Hardly evidence of the superiority of the American system.

Your general point, however, is well taken: the US system is almost literally off the charts due to its unique combination of high costs and crappy outcomes.
Thanks Patrick! Yes, I agree that the mortality rate provides better or more useful information. Because of the lack of proper health care coverage in the US, many people will die prematurely of cancer or other diseases (as discussed previously – I have one post on this). I believed this is also covered in the CBC report above.
What this study, what no study covers is "WHY" a person dies when becoming ill. Do they die of the actual disease, or do they die of some completely unrelated complication that is minor compared to the original diagnosis, so the death is attributed to the original diagnosis.

Take, for example, someone who is diagnosed with cancer. That patient then goes through chemo and radiation, which will, in the best of conditions, give them "X" number of years more to live. However, if that same person develops a staph infection, or the flu while IN the hospital, and dies because the chemo and radiation has eradicated their immune system to the point where the body can not fight the infection, and the person dies of a simple common infection, cancer free, that person is still diagnosed as a cancer, or cancer related death.

My point is, this article does NOTHING to talk about the quality of medicine we receive, when we recieve it. It, and every other study has only ever dealt with death rates and survivability of "treated" vs "untreated", not "treated with X" vs "treated with Y", and THAT is a quality study.

This is a cost study of treatment, not a comparative cost/benefit of one treatment vs another, because, often times, the medical community only HAS one treatment for a given ailment.

ONLY when that issue is addressed will we ever have an honest, up front, forth right discussion of QUALITY of care. But, no one in this country cares about quality of care, so long as they continue to get their crappy, and often dangerous poisons at lower and lower cost
Placebostudman: Thanks for dropping by. You made good points. Since I haven’t read the original report, I cannot exactly say what other kinds of analyses were done in the comparison study. The sense I get from these kinds of studies is that the researchers or analysts try to examine the outcome (death, survivability, etc.) as a function of the money invested in health care at the aggregated level. This can create problems though, such as those you listed (X affecting Y). A dissagregated analysis may help answer the questions you raised.
Kanuk,

The kind of study I want will never happen. The kind of study I want would be one where the patient is assumed to have the best health insurance in the world, so all options are available, therefore the efficacy of Product A vs Product B vs Product C could be tested independant of relative price, and there would have to be some leeway in the study to account for different situations, such as someone like me who can not be put under general anesthesia for surgery, due to compromised lung funciton and poor circulation
And with our infant mortality rates being non-competitive with Honduras, that's why we have Joe Lieberman.
The problem with this type of report is that it is an attempt to quantify the qualifiable. Based largely on studies designed to support the "evidenced based" approach to health care, which is the foundation of the recent movement to implement a pervasive socialist overhaul of the U.S. health care system, these reductive statistics attempt (and fail) to quantify such issues as quality of life, comfort, satisfaction, etc... Aside from the obvious fact that these are arbitrary and do not translate from one cultural or societal context to another, the threat is that this leveraging of quality against economy of service ultimately dehumanizes patients and sets the stage for such ethical atrocities as the recently proposed state run "death panels". Quite the slippery slope.
C Wright,

First, as an American, you (and I) are already part of a “death panel.” You see, the American society has already decided that not every U.S. citizen is entitled to be provided with proper medical insurance. In fact, 15% of all Americans (300 million people) have no medical insurance. We can also add to those folks many more millions who are under-insured (and this includes close friends of mine). Thus, as a society, we have agreed to let 45,000 people die of a premature death every year. I discuss this topic in great details in a previous post:

“Death Panel” Results: 45,000 Annual Deaths!

As director and producer of documentaries, you should examine on your next project why other industrialized countries can provide medical insurance to every citizen at a much lower cost than our health care system. A good start can be found here. Putting aside ideological issues, such as the government taking over health care (i.e., in your words, socialist overall), other developed countries have understood that the best way to minimize health care costs is to spread the risk among all its citizens. More details about health care costs can also be found here:

Let's compare Public and Private health care costs, eh?

Second, I do not have the time to look for the studies I linked in comments I made a few months ago, but at least two international ones have examined the level of satisfaction related to health care delivery. In one, the percentage of Americans who were satisfied with their health care was in the bottom third of all developed countries. The other one (by the CDC, if I remember correctly) compared the level of satisfaction between Americans and Canadians. For Americans who had proper health insurance, the percentage was a little bit higher than the percentage found in Canada. However, for people who did not have medical insurance (only in the U.S. that is), the percentage of people who were satisfied was much less. I’m wondering what explains this second difference.

Thanks for dropping by.
I think Frank's concerns are valid even if his message is wrong. Nobody wants to spend too much for health care in the US, whether it's for me or one of my neighbors. We just need controls on the spending, but yes, the overall health of the people in this country benefits everyone.
All I know is, my parents don't have health care, and it would be nice to know they're taken care of if they get sick. It's something me and my sister both worry about.