Published: Wed, March 14, 2018
Medicine | By Douglas Stevenson

American are spending more on health care but why?

American are spending more on health care but why?

The United States spent 17.8 percent of its gross domestic product on health care in 2016, far more than countries such as Australia (9.6 percent), the U.K. (9.7 percent), Canada (10.3 percent) or Switzerland (12.4 percent).

But a new study claims that some of the purported explanations for why America's health care bill is so huge simply do not wash.

The results suggest that people looking to lower USA health care spending should look beyond factors commonly blamed for the imbalance - such as utilization of the medical system - when searching for solutions, the researchers write in the paper.

Nor does America have too many high-paid specialists.

Although this is true - U.S. spends a little less on social services than their peers - investigators claim that this is not responsible for the rising health care costs.

Instead, it looks as though the United States pays more because it faces higher price tags for drugs, tests, office visits and administration, Woskie said. However, on a per capita basis, the U.S. spends much more than any other country: $9451 in 2015, compared to Germany's $5267.

An extensive new analysis of why the US spends so much more on health care than other rich countries reinforces the answer other recent studies have found: It's not that Americans get more care or relies on specialists to a greater extent than people in those other countries.

Despite efforts to control healthcare costs, the still spending about twice as much as other high-income countries on medical care, according to a new JAMA report.

One positive - the US ranked second lowest for smokers - was offset by the country having the highest percentage of adults who were either overweight or obese, the lowest life expectancy and highest infant mortality.

"These findings indicate that efforts targeting utilization alone are unlikely to reduce the gap in spending between the United States and other high-income countries, and a more concerted effort to reduce prices and administrative costs is likely needed", the authors write.

The US also spend more money on drugs, with each American spending more than $1,443 a year on pharmaceuticals, while others nations spend between $466 and $939. It's that Americans pay more for everything from administrative costs to doctors and drugs. In an editorial accompanying the new study, Katherine Baicker and Amitabh Chandra of the University of Chicago and Harvard note that the latest analysis doesn't delve into the qualitative details of health care treatments Americans get compared to people in other countries. It's not necessarily that a lot of it is unnecessary, because our volume is similar. In the United States, per capita spending was $1,443.

Doctors and nurses are also paid more generously in the United States. Medical procedures were similarly overpriced in the US, and American medical professionals also make significantly more money than their peers in other countries, according to the paper. These costs, which include planning, regulating and managing health systems and services, accounted for 8% of costs in the US compared to between 1% and 3% in the other countries.

That's not just because the United States has a complicated insurance setup, either. Yet, we found that the USA has comparable rates of utilization overall, with lower numbers of physician visits and hospitalizations, ' Dr Jha said.

Contrary to commonly held beliefs, high utilization of healthcare services and low spending on social services do not appear to play a significant role in higher US healthcare costs.

The study will be published March 13, 2018 in JAMA (Journal of the American Medical Association).

The US is also the only developed country which doesn't offer universal healthcare.

Any solution also will need to reflect the nation's morals and priorities, something that can not be assessed by pure economic analysis alone, she added.

"All of the conversations assessing different policy options should start with what our goals are and what's important to us, and then we can apply the lessons from economics to achieve those goals", she said.

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