Key drivers of high USA healthcare spending identified

American are spending more on health care but why

For the study, researchers examined worldwide data from 2013 to 2016 comparing the USA with 10 other high-income countries: the U.K., Canada, Germany, Australia, Japan, Sweden, France, Denmark, the Netherlands, and Switzerland. However, on a per capita basis, the United States spends much more than any other country: $9451 in 2015, compared to Germany's $5267.

Sharp spending on drugs and doctor's salaries are chief propellers of the high cost of healthcare in the USA, according to researchers at Harvard T.H. Chan School of Public Health, Harvard Global Health Institute and the London School of Economics. The U.S saw 192 discharges per 100,000 people. However, the USA population does not appear to use care more than other countries, which is why healthcare reform efforts aimed at utilization alone are unlikely to have an impact on spending, the authors said. The United States spent 17.8 percent of its gross domestic product in 2016 on healthcare. The indicators, derived from data spanning 2013 to 2016, fell into seven facets: general spending, population health, structural capacity, utilization, pharmaceuticals, access and quality, and equity.

They spend nearly twice as much as other affluent countries but are not being able to improve the health of citizens.

People in the U.S. shell out $9,403 a year on health care services, while wealthy nations like Germany spend on average a little more $5,000. The U.S. also had the lowest health-adjusted life expectancy, or the average length of time a person lives in good health: 69 years, compared to a mean of 72 years in the other areas.

Inequalities in innovation, costs and outcomes may be reasons the USA lags behind other high-income countries, Stephen Parente of the University of Minnesota writes in an accompanying editorial. Among the other nations, Switzerland ranked next to the U.S.at 12.4 percent and Australia ranked the lowest at 9.6 percent.

Fewer people in the United States are insured - 90 percent, compared to other countries which ranged from 99-100 percent.

The study, conducted by researchers at Harvard University, debunks numerous common beliefs people have about why the USA spend so much money on healthcare.

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She said, "At least compared to the peers, we have a pretty similar mix of primary care to specialists".

Belief: The U.S. spends too little on social services and this may contribute to higher health care costs among certain populations. A generalist physician was paid $218,173 in the US during the study period, compared to $86,607 to $154,126 in the other countries.

Evidence: Overall, quality of care in the USA isn't markedly different from that of other countries, and in fact excels in many areas.

Administrative costs of care-activities related to planning, regulating, and managing health systems and services-accounted for 8% of total healthcare costs, compared with a range of 1%-3% for other countries. The US actually has excellent healthcare for those who have heart attacks or strokes but is below average in avoidable hospitalizations for things like diabetes and asthma.

Common brand-name medicines were often double the price seen in other nations. The average salary for a general practice physician in the USA was $218,173, while in other countries the salary range was $86,607-$154,126. "Worldwide comparisons are very valuable-they allow for reflection on national performance and serve to promote accountability", said first author Irene Papanicolas, visiting assistant professor in the Department of Health Policy and Management at Harvard Chan School.

Liana Woskie, assistant director of the Harvard Global Health Institute's strategic initiative on quality, was a co-author of the study.

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