Originally Posted by ALackOfCreativity
Every country has lower costs than America. All of them. And not by a small amount either.
This is why it is meaningless to say that UHC would be cheaper in America than the status quo because it is cheaper elsewhere.
An argument 100% logically equivalent to this would be saying that every NBA player can shoot 3 pointers more consistently than I can shoot 2 pointers, and thus if I tried to shoot more 3 pointers while playing basketball and less 2 pointers I would get a higher proportion of my shots into the hoop. The problem with this logic is of course, that the reason the NBA players are doing better than me is that they are awesome at basketball and I, to put it mildly, am terrible. If you looked at players shooting 2 pointers instead, they'd also be doing better than me. Does why the comparison is meaningless make sense now?
No, because that is not how comparisons work.
In your example, you belong to the group of "Non-NBA players
", while you are comparing yourself to the group of "NBA players
". A group selected for skill at basketball.
In terms of basketball, this is an intuitive group selection. In tems of health care provision, the USA does not belong to any such intuitive group. It belongs in the group of Bismack-type, employer based insurance provision right next to Germany. I wish I knew how to make and insert I diagram here but try to imagine a group of circles really close, Germany, Netherlands, Japan, the US, and Switzerland. A distance away, another cluster, the Beveridge-model countries such as the UK and the Nordics. A third group, separate from the two other groups are the NHI-model countries such as Canada and Taiwan.
These are reasonable groups based on how health care is provided in various nations. We'd expect costs per person in the US to be close to the costs of other Bismarck-type countries. In reality, costs in the US are vastly much higher than they are in countries that the US naturally compares to.
The point summarized: "UHC countries
" is not a natural group. It contains countries very similar to the US in healthcare and lifestyle issues and countries very very different.
You are advancing the hypothesis that the group of "UHC countries
" by coincidence overlaps 100% with the group of "countries intrinsically better than the USA at cost control
This is, to put it mildly, very unlikely. The error you are making is that you see the foreign countries as far more similar to each other, and different from the USA, because they are foreign. In actual fact, the US is simply a Bismarck-type country with poor regulation and incomplete coverage.
Now, let us look at the theory. Economic orthodoxy states that health care is very badly suited to market-based delivery. Kennth Arrow won the Nobel prize in Economics in 1972 for his work on uncertainties. Among that body of work was Uncertainty and the Welfare Economics of Medical Care
a work that cam to be fundamental in the discipline of Health Care Economics. I recommend reading it, it points out some of the reasons why markets do not work well as providers of health care.
The point summarized: That markets are not well suited to health care delivery is not only a conclusion we can draw from real-world observation, it is also economic orthodoxy.
Originally Posted by ALackOfCreativity
although I doubt it makes up a large magnitude of the US/Europe difference
The amount of money wasted in US health care each year is possibly more than 1 trillion dollars. Or more accurately, a God-awful Lot. That doesn't happen without people noticing. This is how they have estimated the breakdown of the spending difference between Europe and America:
Originally Posted by Memphis1979
The number is not representative of the individuals reality in those countries.
There are people here who get better healthcare then they do there. We have the best hospitals in the world, along with the best doctors.
Well, factually the US hospitals and doctors do not compare very well.
If you meant that the best
US hospitals are also the best in the world, that may be a bit more realistic. However I don't think that statement leads to the conclusion you think. Who actually gets healthcare in the best US hospitals? Well, for one rich people who can pay for their own treatment. Billionaires. But that does not mean US billionaires only. A billionaire from Norway, Ghana or Russia can have treatment just the same as an American one.
And then there are the non-rich people. If a European hospital cannot provide a lifesaving treatment, in some countries the patient can go to a foreign hospital and the government has to pick up the bill.
For example, in Norway about 500 people each year get treated outside the country. That treatment is for the most difficult or severe cases, and will normally land only in the hospitals that can handle the most difficult case, i.e. the best ones.
Now I can't work out the numbers here, but given that thel number of people in Norway that come down with such severe problems in a year isn't huge....I suspect that if Joe Average, USA comes down with something like that, his odds of being treated by the best hospital in America are worse than those of Joe Norwegian.
So even if the best hospitals in the US are the best in the world, it does not follow that Americans benefit the most from them.
Originally Posted by munna21977
how expensive was american healthcare for common people in 1960s or 1970s? I remember many common people from other countries coming to US for their surgeries. now only presidents or film stars come. so many americans are going to countries like India for medical surgeries. So either american healthcare costs have risena astronomically in last 2 decades or people are becoming poorer.
Organisation for Economic Co-operation and Development (2010), "OECD Health Data", OECD Health Statistics
(database). doi: 10.1787/data-00350-en (Accessed on 14 February 2011).
Data from Australia and Japan are 2007 data. Figures for Belgium, Canada, Netherlands, Norway and Switzerland, are OECD estimates. Numbers are PPP adjusted. Break in series: CAN(1995); SWE(1993, 2001); SWI(1995); UK (1997). Numbers are PPP adjusted. Estimates for Canada and Switzerland in 2008.
Originally Posted by ALackOfCreativity
The problem is the baseless numbers are of literally no value; you might as well say most insurance companies have loss ratios between 0 and 1 and it would be of equal value. The only thing it does is to imply (incorrectly) that there are a lot of company near either arbitrary extreme, and imply (again, incorrectly) a relatively even distribution across that range.
Dig, the 10% was presented as a Massachusetts average....if we can extend that to the nation (which I doubt, but, doing the thought exercise lacking national data):
Total 'reduction' in costs from going to UHC model from insurance model (A) = Insurance industry average loss ratio (X) - added government administrative costs (Y) - reduced managed care efficiency(Z).
You formula contains a couple of errors, and is oversimplified.
First off, you are assuming that a UHC model and an insurance model are two different things. This is not true, many UHC models are provided by private insurance. You may have meant going to an NHI or Beveridge-model system, in which case you X vale is off by a lot. We'll look at that in a bit.
Second, you are assuming there will be increased government costs.
Real-world observation tells us that government administrative costs are lower in every country that has UHC. Further, the US is already running a number of public health care programs, Medicare, Medicaid, Veterans, Indians, childrens etc. Each of which has its own bureaucracy, rules renumerations, etc. This is why US public health care costs per person are already higher than most European nations. Running one set of rules for everyone is simply cheaper than running lots of different rules for different groups, and doing a lot of work to keep anyone not qualified from getting anything.
The same is the case for Z, real world experience simply shows that the care efficiency is better in a UHC environment. Thats also pretty fundamental theory, letting medical professionals control have control of the resources to maximize health care works better than letting companies have control of them to maximize profits.
Every public health measurement, average lifespan, infant mortality, amendable mortality, HALEs, DALYs, maternal mortaliy etc shows medical control of the resources to work better.
Now getting back to the formula you proposed...as I pointed out, you got UHC confused with Beveridge and NHI model systems. If you meant your formula to apply to the move to a Bismarck type system, it becomes quite difficult. That kind of system can theoreticllly have 100 % savings to government expense. I.e. it can all be financed by the employers. It all depends on the legislation.
In the case of moving to a Beveridge or NHI model, as pointed out, Z and Y will be positive qualities. Where you've really gone wrong though is X. Fist off, your savings are not only the loss ratio. You also save the entire administrative costs of the entire insurance industry, as well as the administrative costs incurred by all the health care institutions working with the industry.
Also...In the US the health care insurance industry is 600 000 people, mostly at very good salaries. The Beveride and NHI countries do not see that they actually do
anything at all, and health care insurance is a small part of general insurance.
ALackOfCreativity, you seem to have though about this quite a bit, but without doing any reading up on it. Several of the things you state as fact are not just at odds with all serious economic theory, but also simply at odds with how we can see things work in the real, physical, non-theory world.
Originally Posted by MTAtech
The problem arises when a person becomes unemployed or wants to become self-employed.
Knowing that one will not be eligible for health care coverage keeps some employees working at their firms instead of starting their own businesses. That's an unintended consequence to our pre-Obamacare system.
According to some fascinating economic research, Is Employer-Based Health Insurance A Barrier To Entrepreneurship?
, there's an unexpectedly large numbers of Americans becoming entrepreneurs within months of qualifying for Medicare (over and above those you would expect to become entrepreneurs because they were fired, forcibly retired, etc.) The reason: They now have the security of healthcare, so they can take the risk of starting private companies. It's just one of the MANY, MANY ways in which a vigorous public and private sector support each other to create a successful economy that can't occur when there's only one or the other.
Originally Posted by Dane_in_LA
Interesting link, thanks! I always wondered about that - I know a few self-starters back in OMG-socialist! Denmark who struck out on their own with varying success. I always wondered how people in the US with a sick spuse or a sick kid would be able to. Appears they aren't, which really isn't a surprise.
I've seen similar statistics. While the US scores higher than any other country on people who wants
to start their own business, many countries have more people who actually do
In fact the two countries with the highest rate of business startups are Norway and Denmark, countries with strong social policies. (Long article, some relevance)