Sunday, July 18, 2010

Comments on Comparative Health Care Systems; Focus on the Commonwealth Fund's Reports

The Commonwealth Fund has come out with an informative transnational comparison of health care systems. Despite its name, this Fund is not a financial entity. In its own words, it is a:

private foundation that aims to promote a high performing health care system that achieves better access, improved quality, and greater efficiency, particularly for society's most vulnerable, including low-income people, the uninsured, minority Americans, young children, and elderly adults.


The main Report discussed herein is "Mirror, Mirror on the Wall: How the Performance of the U.S. Health Care System Compares Internationally; 2010 Update".

The findings reflect poorly on America. This post will summarize some of the information therein. Follow-up posts will explore how America can do better, with some discussion of the recently-passed health care reform bill but with emphasis on new, independent thinking on health and health care economics.

All interested parties should read the Fund's report, either in full as linked above or the Summary.

The report compares various measured outcomes for the U. S. healthcare system against six other countries, most of them English-speaking: Australia, the U. K., Canada and New Zealand; plus Germany and the Netherlands. Similar comparisons in 2004, 2006 and 2007 showed the U. S. was last in all measured categories, as was also found in this year's report.

These results were quality of care, access, efficiency, equity, life span and cost.

Another Commonwealth Fund report on a similar trans-national comparison of health care from June of this year called Measuring the U.S. Health Care System: A Cross-National Comparison. One of the key findings in this related report is:

The U.S. has a comparatively low number of hospital beds and physicians per capita, and patients in the U.S. have fewer hospital and physician visits than those in most other countries.

This report finds that the U. S. has about 27% fewer practicing physicians per capita than the average for 30 OECD countries. It is my sense that this problem, and the related problem of shortages of nurses, is the most fundamental important healthcare problem we have. It takes a long time and a lot of money to bring doctors into the workforce. Even if physician salaries shrink in inflation-adjusted terms as their supply increases in regard to population, total healthcare spending will tend to rise as more patients get seen and evaluated. In other words, an issue not (in my view) satisfactorily addressed by the recent health care legislation is the conflict between the stated goal of "bending" the healthcare cost curve while simultaneously treating more people and educating more and more physicians. The DoctoRx preferred solution is to say openly that the basic goal of the legislation, that of better health of the population, is inherently costly and that the goal of increasing efficiency and decreasing costs is not easy to achieve, and that society therefore should be ready to commit an even greater proportion of its resources to health care than it currently does should efforts to control health care spending not meet projections. Otherwise we may end up with Ponzi/fraudulent economics in this regard.

Back to the theme of the main report.

Numerous other organizations such as the World Health Organization have studied other countries such as Japan, Italy and Spain and have shown similar findings. There is thus little doubt that for the stated criteria, America will benefit from improvement. Of course, the devil is in the details. Here are some of the findings of the Commonwealth Fund's report and some of its own commentary, including the following cautionary language (Sec. 1; vii):

Any attempt to assess the relative performance of countries has inherent limitations. These rankings summarize evidence on measures of high performance based on national mortality data and the perceptions and experiences of patients and physicians. They do not capture important dimensions of effectiveness or efficiency that might be obtained from medical records or administrative data. Patients’ and physicians’ assessments might be affected by their experiences and expectations, which could differ by country and culture.

And that is followed by a statement that stems from a particular viewpoint:

Disparities in access to services signal the need to expand insurance to cover the uninsured and to ensure that all Americans have an accessible medical home.

Re the last statement, a different report using the same data and similar public health motives might for example have said:

Disparities in access, which are largely limited to the least affluent members of society, call for free medical care for all of limited means for serious health conditions and heavily discounted care for milder conditions.

Or even more broadly:

The fact that the U. K. is #2 in overall rating amongst the 7 countries studied means that the U. S. should consider adopting its system in which all medical care is provided by the State paid for out of general revenues, with private insurance purchasable if desired, as in the United Kingdom.

In other words, the call for everyone to have "insurance" is a political one. Also, further on in that statement is the vaguer assertion that all Americans should have an "accessible medical home". What does that mean? If it is asserting that everyone should have a primary care doctor, why not say that?

"Accessible medical home" is jargon, but this is a report for the public. Is Commonwealth saying that even the homeless should have a medical home, whatever that is? What about itinerant workers, such as agricultural workers who move from south to north, or golf caddies who do the same thing?

Commonwealth is more than entitled to its own point of view, and I am not commenting on said point of view either positively or negatively. My point is that it would have been optimal in my opinion if there were a clear separation of Commonwealth's policy recommendations from the factual report. After all, advocacy groups such as Commonwealth may present data selectively, and when an organization with a goal, no matter how public-spirited, puts out a report that it wishes to be accepted as fully accurate, it helps its cause when said report meets the highest possible standards of objectivity and peer review.

Let us discuss an economic topic the report addresses, that of spending on health per capita.

We're #1 on that one!

Per capita U. S. spending on health care was $7290 per person, triple that for New Zealand (the lowest spender of the seven countries).

This statistic is worth thinking about at least a bit before passing judgment on it as a sign that something is rotten in the U. S., though it is of course troubling that the U. S. spends more than it needs to achieve mediocre outcomes.

For example, say that in the U. S., surgeons rate highly on per hour compensation, and plumbers much less highly (not so true, but let's assume). And let's say that said ratio of incomes is much more equal in New Zealand (which is the case). Does that necessarily call for "reform", and in which country should the reform occur? Again, the answer is political-economic; there is no absolute right or wrong. In other words, surgeons in the U. S. have relatively higher incomes than in New Zealand or Germany compared to other workers. Is this a bad thing? Might we also say that New Zealand is not getting good value from its plumbers?

If you're a doctor, it's a good thing to be paid more rather than less. Given the relative shortage of doctors in America as described above, it's not a surprise that their income is relatively higher than in countries where they are more plentiful. Overall, is the societal wealth pie changed if doctors are higher or lower on the financial income scale? I'm not sure.

But of course the above point is only part of the problem. I mention it because it is always important to think critically. The Commonwealth Fund points out how deficient the U. S. "system" is on efficiency and related problems, including health information. When one talks inefficiency, one is now talking real costs, both financial and health-related.

One would think that given its global leadership in information technology, the U. S. would be a leader in medical data-sharing and individual data storage. The potential for this to improve quality and efficiency of care in a mobile population is large, but the U. S. ranks last in this study. Assuming more than adequate levels of privacy are ensured, there is great therapeutic and research potential from portable individual data that can also be aggregated for analysis.

Sadly, the U. S. ranks last on efficiency in the Commonwealth report. So much for Yankee ingenuity. (The U. K. ranked first.)

The U. S. also ranked last on "equity". Not good, obviously, and clearly this relates to wealth differences and associated demographic factors. Something "must" be done. It is unknown how healthcare legislation will play out; the U. K. was 2nd in equity, but the Netherlands and New Zealand have not dissimilar systems to each other in some ways but were ranked #1 and #6 respectively in that category. In other words, it may not be that one system is better than another but how they are funded and implemented.

In addition to having a relative physician shortage and probably an even larger shortage of primary care physicians, my major criticism of the U. S.'s current system is that there is no system. There are so many different types of healthcare insurance in the U. S. ranging from universal and nearly or totally free (military), to subsidized privately-funded healthcare (employer-paid and other), subsidized universal coverage by age and disability (Medicare), subsidized by income (Medicaid), and cash payers that there there is no system. It is messy, unfair, inefficient and costly.

The reader may wish to think about whether the healthcare legislation signed into law this year adequately addresses this issue. My sense is that it does not and therefore it has a serious structural deficiency, and that therefore this entire topic may be addressed in the future. I believe that all the other six countries to which the U. S. is compared in the report have coherent systems of universal coverage but with different models including single-payer Medicare-type to insurance companies acting as nonprofit pass-through entities to fairly pure socialism. But everyone is covered for life in one system they get to know and that has maximum advantages of scale. Is it possible that the U. S. ranks at the bottom in good measure simply because of its messy melange of different types of coverage and that the key legislative move would have been to simplify matters as is the case in the other countries studied?

Before concluding, I would like to note that other experts have specific points they have raised in defense of American healthcare. For example, certain cancer treatment statistics favor America over many other advanced countries. Other ways to slice and dice the data for other political reasons break down American healthcare by insured/uninsured status and in other ways, and show (or purport to show) that if you have good insurance in America and are well-educated, there may be no better a place to live re health care. An argument coming from this point of view was to leave the healthcare system largely intact and focus on incremental improvements.

In any case, barring the unlikely event of repeal of said legislation, what is pending is implementation.

Stay tuned.

Copyright (C) Long Lake LLC 2010

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