What can we learn from our neighbors?
Grandma fell. You were home from college for winter break visiting Mom, Dad, Grandma and your two younger siblings. It was snowing outside and the stairs up to your parent's house were covered in sleet. Grandma fell down these stairs and you all rushed her to the hospital only to learn that she would need hip replacement surgery. If she didn't have the surgery, Grandma wouldn't make it past next summer.
In the United States, Grandma's hip replacement will cost between $50,000 and $100,000 without insurance. If her surgery is eligible for coverage under Medicare, her surgery and recovery could only cost between $16,500 and $33,000. Either way, Mom and Dad will have to cut into your sibling's college savings to pay for Grandma's surgery. Which one of your siblings will sacrifice their college education for Grandma's hip?
In Germany and Japan, your parents wouldn't need to choose between Grandma's life and your little sister's college education. In Germany, Grandma could see any doctor that she wanted to. German doctor's associations negotiate prices, so the final hip replacement bill would only be around $20,800. In contrast to in the United States, Grandma wouldn't have to pay any out-of-pocket costs for her visits and a sickness fund would cover most, if not all, of her medical bill.
Germany's healthcare system ensures that all citizens have health insurance. Health insurance programs compete for market share and operate as private, not-for-profit entities. All citizens are required to purchase some form of health insurance, whether through statutory health insurance (sickness funds) or private health insurance. The government picks up the bills for the unemployed, but overall the government plays a very limited role in paying and providing healthcare to their citizens. Healthcare prices are significantly lower than those found in the United States because sickness funds and provider associations negotiate prices down.
Japan's healthcare system also offers universal coverage and free choice of provider. Healthcare expenditures are funded by employer and employee payroll taxes and income-based premiums for the self-employed. There are some out-of-pocket costs for patients, but they are minimal compared to those in the United States and no citizens go bankrupt because of medical costs. If Grandma were to get her hip replacement in Japan, she could find price tags like $4,126. These low costs are a direct result of heavy negotiations from the Central Social Medical Care Council. Even though Japan has some of the lowest medical care costs out of other developed countries, it has better outcomes and the world's highest life expectancy rates. Grandma will be well taken care of in Japan and Mom and Dad can still send your little sister to college.
Both Germany and Japan spend less of their GDP on healthcare. The graph to the right shows a comparison of healthcare spending in Germany, Japan, and the United States as a percentage of GDP. Japan is seen in red. Germany is in yellow and the United States is labeled green. It is obvious that the U.S. has these two countries beat by a landslide. In fact, the United States has every other country (seen as faded circles) in this study beat as well. One would think that these high expenditures are leading to greater outcomes, but this is not true.
The United States spends more per capita on healthcare than any other country, but life expectancy averaged out at only 78.8 years old in 2010. In that same year, life expectancy in Germany was 80.3 and was 82.7 years in Japan. Clearly, these two other countries are doing something that the U.S. isn't doing with our healthcare.
Naoki Ikegami from Japan and Karl Lauterbach from Germany touch on some of these differences in the documentary, "Sick Around the World". Lauterbach praises Germany's not-for-profit insurance programs and the fact that everyone is covered, regardless of employment status. Ikegami takes pride in Japan's low healthcare costs, lack of bankruptcy from medical expenditures, and universal coverage. Both experts, however, have criticism for their country's healthcare system too. There is no perfect system and there are no studies that show exactly why other countries are living longer lives for less money. It could be because everyone has access to healthcare or that people in Japan and Germany are simply living healthier lives than us.
We do know, however, that Grandma could receive her life-saving hip replacement surgery in Japan and Germany for a fraction of what it would cost her in the United States.
In the United States, Grandma's hip replacement will cost between $50,000 and $100,000 without insurance. If her surgery is eligible for coverage under Medicare, her surgery and recovery could only cost between $16,500 and $33,000. Either way, Mom and Dad will have to cut into your sibling's college savings to pay for Grandma's surgery. Which one of your siblings will sacrifice their college education for Grandma's hip?
In Germany and Japan, your parents wouldn't need to choose between Grandma's life and your little sister's college education. In Germany, Grandma could see any doctor that she wanted to. German doctor's associations negotiate prices, so the final hip replacement bill would only be around $20,800. In contrast to in the United States, Grandma wouldn't have to pay any out-of-pocket costs for her visits and a sickness fund would cover most, if not all, of her medical bill.
Germany's healthcare system ensures that all citizens have health insurance. Health insurance programs compete for market share and operate as private, not-for-profit entities. All citizens are required to purchase some form of health insurance, whether through statutory health insurance (sickness funds) or private health insurance. The government picks up the bills for the unemployed, but overall the government plays a very limited role in paying and providing healthcare to their citizens. Healthcare prices are significantly lower than those found in the United States because sickness funds and provider associations negotiate prices down.
Japan's healthcare system also offers universal coverage and free choice of provider. Healthcare expenditures are funded by employer and employee payroll taxes and income-based premiums for the self-employed. There are some out-of-pocket costs for patients, but they are minimal compared to those in the United States and no citizens go bankrupt because of medical costs. If Grandma were to get her hip replacement in Japan, she could find price tags like $4,126. These low costs are a direct result of heavy negotiations from the Central Social Medical Care Council. Even though Japan has some of the lowest medical care costs out of other developed countries, it has better outcomes and the world's highest life expectancy rates. Grandma will be well taken care of in Japan and Mom and Dad can still send your little sister to college.
Both Germany and Japan spend less of their GDP on healthcare. The graph to the right shows a comparison of healthcare spending in Germany, Japan, and the United States as a percentage of GDP. Japan is seen in red. Germany is in yellow and the United States is labeled green. It is obvious that the U.S. has these two countries beat by a landslide. In fact, the United States has every other country (seen as faded circles) in this study beat as well. One would think that these high expenditures are leading to greater outcomes, but this is not true.The United States spends more per capita on healthcare than any other country, but life expectancy averaged out at only 78.8 years old in 2010. In that same year, life expectancy in Germany was 80.3 and was 82.7 years in Japan. Clearly, these two other countries are doing something that the U.S. isn't doing with our healthcare.
Naoki Ikegami from Japan and Karl Lauterbach from Germany touch on some of these differences in the documentary, "Sick Around the World". Lauterbach praises Germany's not-for-profit insurance programs and the fact that everyone is covered, regardless of employment status. Ikegami takes pride in Japan's low healthcare costs, lack of bankruptcy from medical expenditures, and universal coverage. Both experts, however, have criticism for their country's healthcare system too. There is no perfect system and there are no studies that show exactly why other countries are living longer lives for less money. It could be because everyone has access to healthcare or that people in Japan and Germany are simply living healthier lives than us.
We do know, however, that Grandma could receive her life-saving hip replacement surgery in Japan and Germany for a fraction of what it would cost her in the United States.
Based on your blog posts, is your proposal to continue to provide links about how the U.S. compares to other countries? Remember that T.J. Reid did a similar analysis based on his shoulder injury. What is your plan moving forward? What goal do you have (or what do you want to learn) at the end of this research project?
ReplyDeleteHere is a link to an image showing healthcare costs and life expectancy. (I mentioned this during your talk and finally found it.)
ReplyDeleteTry this. https://drive.google.com/file/d/0BxJ-o_ir5232TGxXOHAtSDY1emM/view?usp=sharing
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