Five Myths About Health Care in the Rest of the World

Journalist and author T.R. Reid set out on a global tour of hospitals and doctors' offices, all in the hopes of understanding how other industrialized nations provide affordable, effective universal health care. The result: his book The Healing of America: A Global Quest for Better, Cheaper, and Fairer Health Care.

Listen to a great interview with Reid on NPR's Fresh Air | Read the transcript here

By T.R. Reid:

As Americans search for the cure to what ails our health-care system, we've overlooked an invaluable source of ideas and solutions: the rest of the world. All the other industrialized democracies have faced problems like ours, yet they've found ways to cover everybody -- and still spend far less than we do.

I've traveled the world from Oslo to Osaka to see how other developed democracies provide health care. Instead of dismissing these models as "socialist," we could adapt their solutions to fix our problems. To do that, we first have to dispel a few myths about health care abroad:

1. It's all socialized medicine out there.

Not so. Some countries, such as Britain, New Zealand and Cuba, do provide health care in government hospitals, with the government paying the bills. Others -- for instance, Canada and Taiwan -- rely on private-sector providers, paid for by government-run insurance. But many wealthy countries -- including Germany, the Netherlands, Japan and Switzerland -- provide universal coverage using private doctors, private hospitals and private insurance plans.

In some ways, health care is less "socialized" overseas than in the United States. Almost all Americans sign up for government insurance (Medicare) at age 65. In Germany, Switzerland and the Netherlands, seniors stick with private insurance plans for life. Meanwhile, the U.S. Department of Veterans Affairs is one of the planet's purest examples of government-run health care.

2. Overseas, care is rationed through limited choices or long lines.

Generally, no. Germans can sign up for any of the nation's 200 private health insurance plans -- a broader choice than any American has. If a German doesn't like her insurance company, she can switch to another, with no increase in premium. The Swiss, too, can choose any insurance plan in the country.

In France and Japan, you don't get a choice of insurance provider; you have to use the one designated for your company or your industry. But patients can go to any doctor, any hospital, any traditional healer. There are no U.S.-style limits such as "in-network" lists of doctors or "pre-authorization" for surgery. You pick any doctor, you get treatment -- and insurance has to pay.

Canadians have their choice of providers. In Austria and Germany, if a doctor diagnoses a person as "stressed," medical insurance pays for weekends at a health spa.

As for those notorious waiting lists, some countries are indeed plagued by them. Canada makes patients wait weeks or months for nonemergency care, as a way to keep costs down. But studies by the Commonwealth Fund and others report that many nations -- Germany, Britain, Austria -- outperform the United States on measures such as waiting times for appointments and for elective surgeries.

In Japan, waiting times are so short that most patients don't bother to make an appointment. One Thursday morning in Tokyo, I called the prestigious orthopedic clinic at Keio University Hospital to schedule a consultation about my aching shoulder. "Why don't you just drop by?" the receptionist said. That same afternoon, I was in the surgeon's office. Dr. Nakamichi recommended an operation. "When could we do it?" I asked. The doctor checked his computer and said, "Tomorrow would be pretty difficult. Perhaps some day next week?"

3. Foreign health-care systems are inefficient, bloated bureaucracies.

Much less so than here. It may seem to Americans that U.S.-style free enterprise -- private-sector, for-profit health insurance -- is naturally the most cost-effective way to pay for health care. But in fact, all the other payment systems are more efficient than ours.

U.S. health insurance companies have the highest administrative costs in the world; they spend roughly 20 cents of every dollar for nonmedical costs, such as paperwork, reviewing claims and marketing. France's health insurance industry, in contrast, covers everybody and spends about 4 percent on administration. Canada's universal insurance system, run by government bureaucrats, spends 6 percent on administration. In Taiwan, a leaner version of the Canadian model has administrative costs of 1.5 percent; one year, this figure ballooned to 2 percent, and the opposition parties savaged the government for wasting money.

The world champion at controlling medical costs is Japan, even though its aging population is a profligate consumer of medical care. On average, the Japanese go to the doctor 15 times a year, three times the U.S. rate. They have twice as many MRI scans and X-rays. Quality is high; life expectancy and recovery rates for major diseases are better than in the United States. And yet Japan spends about $3,400 per person annually on health care; the United States spends more than $7,000.

4. Cost controls stifle innovation.

False. The United States is home to groundbreaking medical research, but so are other countries with much lower cost structures. Any American who's had a hip or knee replacement is standing on French innovation. Deep-brain stimulation to treat depression is a Canadian breakthrough. Many of the wonder drugs promoted endlessly on American television, including Viagra, come from British, Swiss or Japanese labs.

Overseas, strict cost controls actually drive innovation. In the United States, an MRI scan of the neck region costs about $1,500. In Japan, the identical scan costs $98. Under the pressure of cost controls, Japanese researchers found ways to perform the same diagnostic technique for one-fifteenth the American price. (And Japanese labs still make a profit.)

5. Health insurance has to be cruel.

Not really. American health insurance companies routinely reject applicants with a "preexisting condition" -- precisely the people most likely to need the insurers' service. They employ armies of adjusters to deny claims. If a customer is hit by a truck and faces big medical bills, the insurer's "rescission department" digs through the records looking for grounds to cancel the policy, often while the victim is still in the hospital. The companies say they have to do this stuff to survive in a tough business.

Foreign health insurance companies, in contrast, must accept all applicants, and they can't cancel as long as you pay your premiums. The plans are required to pay any claim submitted by a doctor or hospital (or health spa), usually within tight time limits. The big Swiss insurer Groupe Mutuel promises to pay all claims within five days. "Our customers love it," the group's chief executive told me. The corollary is that everyone is mandated to buy insurance, to give the plans an adequate pool of rate-payers.

The key difference is that foreign health insurance plans exist only to pay people's medical bills, not to make a profit. The United States is the only developed country that lets insurance companies profit from basic health coverage.

In many ways, foreign health-care models are not really "foreign" to America, because our crazy-quilt health-care system uses elements of all of them. For Native Americans or veterans, we're Britain: The government provides health care, funding it through general taxes, and patients get no bills. For people who get insurance through their jobs, we're Germany: Premiums are split between workers and employers, and private insurance plans pay private doctors and hospitals. For people over 65, we're Canada: Everyone pays premiums for an insurance plan run by the government, and the public plan pays private doctors and hospitals according to a set fee schedule. And for the tens of millions without insurance coverage, we're Burundi or Burma: In the world's poor nations, sick people pay out of pocket for medical care; those who can't pay stay sick or die.

This fragmentation is another reason that we spend more than anybody else and still leave millions without coverage. All the other developed countries have settled on one model for health-care delivery and finance; we've blended them all into a costly, confusing bureaucratic mess.

Which, in turn, punctures the most persistent myth of all: that America has "the finest health care" in the world. We don't. In terms of results, almost all advanced countries have better national health statistics than the United States does. In terms of finance, we force 700,000 Americans into bankruptcy each year because of medical bills. In France, the number of medical bankruptcies is zero. Britain: zero. Japan: zero. Germany: zero.

Given our remarkable medical assets -- the best-educated doctors and nurses, the most advanced hospitals, world-class research -- the United States could be, and should be, the best in the world. To get there, though, we have to be willing to learn some lessons about health-care administration from the other industrialized democracies.

Source: washingtonpost.com

Reid is a foreign correspondent for The Washington Post and the former chief of the paper's London and Tokyo bureaus.

Reid was the lead correspondent for the 2008 Frontline documentary Sick Around the World, which examined five other capitalist democracies, looking for lessons on health-care delivery. His books include Confucius Lives Next Door: What Living in the East Teaches Us About Living in the West and The United States of Europe: The New Superpower and the End of American Supremacy.

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The French are right (again) | Salon

By Joe Conason | Salon:

The Europeans spend more money on social programs than we do -- and get great results, in everything from universal childcare to tuition-free higher education.

April 3, 2009 | If the world is no longer enthralled by the “old Washington consensus” of privatization, deregulation and weak government, as British Prime Minister Gordon Brown proclaimed at the London G-20 summit, then now it is surely time to reconsider what that consensus has meant for us over the past three decades. We could begin by looking across the Atlantic at the “social market” nations of Europe -- where support for families and children is less rhetorical and more real than here.

Most coverage of the summit failed to observe the stinging irony of the debate over stimulus spending that brought the United States into conflict with France and Germany. Today’s American demand that the French and Germans (along with the rest of wealthy Europe) should spend much more on government programs and infrastructure contrasts rather starkly with the traditional American criticism of Europeans for spending too much.

So when the French and other Europeans note pointedly that their societies routinely spend much more than ours to protect workers, women, the young, the elderly, and the poor from economic trouble, they’re merely making a factual observation. (France spends as much as 1.5 percent of GDP annually on childcare and maternity benefits alone.) Different as we are in culture and history, we might even learn something from their example, now that the blinding ideology of the past has been swept away.

By now, most Americans ought to know that Europeans treat healthcare as a public good and a human right, which means that they spend billions of tax dollars annually to insure everyone (although they spend less overall on the medical sector than we do). What most Americans probably still don’t know is that those European medical systems are highly varied, with private medicine and insurance playing different roles in different countries. Expensive as universal quality care has inevitably become, as technology improves and populations age, the Europeans broadly believe in their social security systems -- because they provide competitive advantage as well as moral superiority.

From Europe’s perspective, the same can be said of the support its governments provide to families, from the entitlements available to pregnant women and new mothers and fathers, to universal child care and tuition-free higher education, to the special benefits that assist single parents. The challenges that working families face in a globalizing world where both parents work are mitigated by policies designed to encourage balance between home and workplace and adequate attention to children.

These "socialist" measures to protect families are far more effective, of course, than all of the Sunday shouting from American pulpits about the Biblical way of life. Perhaps the leadership of the religious right, still obsessed with stigmatizing gay couples, should take note.

It is true that globalization, aging and immigration have imposed severe pressure on the budgets of European countries, and the trend of increasing benefits that continued until a decade ago has been reversed. But it is also undeniable that despite those pressures, public and political support for the social market economy remains strong across Europe, and that free-market fundamentalism is a thoroughly discredited alternative. The old argument that the social market is unsustainable and hinders growth was never persuasive on close inspection. And the old expectation that outmoded European systems would eventually collapse into imitating ours has been swept away, along with the rest of the Washington consensus. Now perhaps we can honestly consider what America might learn from them.