Universal Health Care and Innovation

Without doubt, the strongest argument against universal health care is the claim that it will staunch medical innovation, that our high spending acts as a research and development subsidy for the rest of the world. I've tried to address this in a bit of haphazard fashion, but never really knew how to take it on in a sustained way. Luckily, Jon Cohn is better at this sort of thing than I am, and his article examining the tanged pathways of medical innovation and how they intersect with universal coverage is very good. Go read.

My Commenters Is Smarter Than I:"Giuliani vs. The Facts" Edition

Earlier today, I noted that Giuliani received his care for prostate cancer while still mayor of New York, which meant he was probably receiving insurance through the state of New York, utilizing one of those government-regulated purchasing pools he terms "socialism." Commenter anonymiss does me one better:

[T]he technique used on Giuliani, prostate brachytherapy--using radioactive seeds--was pioneered in the modern era by a physician in Denmark, and brought to the US by one of his students.

http://caonline.amcancersoc.org/cgi/reprint/50/6/380.pdf

You'd think a guy whose life was saved by bradytherapy would admit, however grudgingly, that European socialized medicine ain't all bad.

And Tyro chimes in:

Given that the average age of patients diagnosed with prostate cancer is 70 (src), clearly a large number of patients are being treated by Medicare, America's very own form of socialized medicine.

So Giuliani's case for the superiority of our "free market" health care system goes something like this: While on health insurance provided by New York state, he was treated, using a surgery developed by Europeans, for prostate cancer, a disease that most commonly afflicts those covered by the federal government's single-payer health care system. Take that, Europe/national health insurance.

More on Prostate Cancer Mortality

And the hits keep coming. Here's a newer chart, from the non-political Cancer Research UK, showing data from 2002 (rather than 1996):

The numbers are a bit hard to eyeball, but it's reporting 15.8 (per 100,000) mortality in the US, and 17.8 in the UK. Moreover, you see the same story as the other graph: Very high incidence rate in America, but a mortality rate clustered around that of every other developed nation. Once again, the most likely conclusion is that bulk of the difference comes from America's aggressive screening procedures. Indeed, the organization explains:

Recent incidence rates are heavily influenced by the availability of PSA testing in the population and incidence varies far more than mortality. The highest incidence rates are in the United States and Sweden and the lowest rates are in China and India (Figure 1.2).7 The extremely high rate in the USA (125 per 100,000) is more than twice the reported rate in the UK (52 per 100,000). This is likely to be due to the high rates of PSA testing in the USA.

That's not a strike against the US. We have quite good prostate cancer treatment, and our mortality is better than most. But we don't have some sort of magical cure that the rest of the developed world missed. Which makes sense. After all, they read the exact same medical journal articles, do business with the exact same medical device companies, and purchase from the exact same pharmaceutical researchers.

Rudy and "Socialized Medicine"

I used to believe that one of Bush's primary problems was that he was governor in a state with an absurdly weak governorship. In Texas, the executive is only the fifth most powerful position, and so Bush's disengagement with public policy made sense. He'd never needed to be engaged. I hoped Giuliani would actually be better, as his time in New York required real substantive involvement with policy analysis. And yet it's the same old crap. Here's Rudy's new radio ad on health care:

Rudy's wandering around with the old prostate care canard. It's -- no pun intended -- crap. England and America have vritually the same mortality rates from prostate cancer. In England (as of 1997), 28 males of every 100,000 died from prostate cancer. In America, then number was 26. The difference comes in "incidence" -- there are many more diagnoses of prostate cancer in America, as we have an aggressive screening process:

Problem is, most of those cancers simply aren't deadly, or even necessarily damaging. They're slow-moving and benign. It's like saying we have a lower death rate from car crashes because we record more near-misses in the statistics. We may indeed have a slight advantage of prostate treatment, but it's not what Guliani is suggesting it is.

Not only are Giuliani's numbers wrong, but the whole metric is off. Prostate cancer isn't the only illness we treat. If what you're interested in is years of life lost due to the health care system, well, we have data on that too. This is from the same source as the prostate cancer stats (which are, I'm pretty sure, the ones Giuliani is using, as they're the ones Cato, who started this argument, uses):

America, you'll notice, doesn't do so well. And to make the old point one more time, we're actually having an argument over which system is better, even as Americans pay more than twice as much for care as the British. At that cost differential, there should be no debate. That there's any dispute at all is evidence that we're doing something terribly wrong. But don't worry. Giuliani is proposing a tax deduction...

Assignment Desk: Wouldn't it be interesting to find out if the gold-standard care Giuliani got during his prostate cancer came while he was on government-provided health insurance? He was mayor at the time, suggesting his care was coming through the city, which would suggest it was through the state insurance pool, which works very much like FEHBP -- which is what the Democrats are proposing to expand to all Americans, and what Giuliani is calling deadly, socialized medicine.

Medical Tourism

Andrew Sullivan's very excited by the fact that Britain has a burgeoning medical tourism industry. "Tony Blair poured millions into Britain's socialized healthcare system," he writes, "pumping unprecedented resources into a healthcare system that Michael Moore admires and the American left loves. This is the result." Take that, mediocre-to-bad health care system that nobody on the Left suggests we should copy!

Of course, Britain spends 41 percent what we do per capita -- and no one thinks Blair made up that shortfall, or anything close to it. So detractors are probably best served by not making funding the issue. I wouldn't have thought, however, that they'd try to move over to medical tourism as a point of comparison. But we can have that discussion. We can talk about the 50,000 Americans who go to Bumrungrad hospital in Thailand every year for cheaper surgeries. We can go into this article, about the Indian hospitals primarily serving Americans, or this one, about the waves of Americans traveling abroad because they're unable to afford heart surgery. Indeed, there are more Americans -- 100,000 -- traveling abroad for cosmetic surgery alone than there are Britons seeking any type of services in foreign lands.

America is actually driving the medical tourism industry that some Britons are taking advantage of. The growth of foreign treatment centers aren't a result of the failings of the British health care system (of which there are many). They're a result of the cost of American health care, and the huge numbers of sick individuals we price out. You'd think, paying two-and-a-half times what the Brits do for health care, that we could all access care, and wouldn't need to fly to India. But you'd be wrong. The Brits also have a bad health care system, but theirs is, on the bright side, very, very cheap. Ours isn't.

Oy, Canada

Joe Paduda discovers what's probably a fake e-mail from a Canadian purporting to warn us about the horrors of his health care system. Then he dismantles it. But expect more of these as the health care debate heats up. You won't see folks defending the current system -- the status quo is too dysfunctional to protect. Rather, you'll see them demonizing the unknown, lying about alternatives, trying to scare Americans into curling up and protecting what they have.

Descent into Darkness

An American in France tells of his experiences with the French system. As you may imagine, it's ghastly, unsettling, stuff, full of prompt appointments and helpful specialists. Conservatives, it's worth saying, have much the same reaction when faced with the horrors of high-quality, socialized care.

More Waiting Times in the US

The LA Times reports that uninsured adults in Los Angeles are waiting more than a year for gallbladder and hernia surgeries. Indeed, the Harbor-UCLA medical center just told the county's clinics to simply stop referring non-emergency gallstone, hernia, orthopedic, or neurosurgery patients till the hospital worked through its year-long backlog.

The clinics, predictably, are responding by sending these patients to emergency rooms, further overwhelming ERs with patients in terrible pain, but not technically suffering from an emergency. Yet. So they're being turned away, though no doubt going into debt or having their wages garnished as they attempt to pay off the bills. Meanwhile, In the absence of the necessary surgeries, we're holding these folks together with belts and trusses -- literally:

Hernias occur when part of an internal organ protrudes into muscle, often after a person strains to move a heavy object. A supportive belt or truss can help hold in the organ, but the belt can be painful and interfere with work, especially in jobs that involve manual labor or standing all day.

Organ poking out and pressing on a muscle? Here's a girdle!

Say it with me, kids: In this country, we ration by income.

American Wait Times

Here's a fun puzzle. Fill in the blanks in the statement below:

In his talk, __________ conceded that "the ___ healthcare system is not timely." He cited "recent statistics from the Institution of Healthcare Improvement… that people are waiting an average of about 70 days to try to see a provider. And in many circumstances people initially diagnosed with cancer are waiting over a month."

If you said "Troy Brennan, CEO of Aetna," and "United States," you'd be right! If you said Canada, or Britain, you'd be wrong. The article goes on:

A Commonwealth Fund study of six highly industrialized countries, the U.S., and five nations with national health systems, Britain, Germany, Australia, New Zealand, and Canada, found waiting times were worse in the U.S. than in all the other countries except Canada. And, most of the Canadian data so widely reported by the U.S. media is out of date, and misleading, according to PNHP and CNA/NNOC.

In Canada, there are no waits for emergency surgeries, and the median time for non-emergency elective surgery has been dropping as a result of public pressure and increased funding so that it is now equal to or better than the U.S. in most areas, the organizations say. Statistics Canada's latest figures show that median wait times for elective surgery in Canada is now three weeks.

"There are significant differences between the U.S. and Canada, too," said Burger. "In Canada, no one is denied care because of cost, because their treatment or test was not 'pre-approved' or because they have a pre-existing condition."

A recent Business Week article arrived at similar conclusion:

[B]oth data and anecdotes show that the American people are already waiting as long or longer than patients living with universal health-care systems. Take Susan M., a 54-year-old human resources executive in New York City. She faithfully makes an appointment for a mammogram every April, knowing the wait will be at least six weeks. She went in for her routine screening at the end of May, then had another because the first wasn't clear. That second X-ray showed an abnormality, and the doctor wanted to perform a needle biopsy, an outpatient procedure. His first available date: mid-August.

The article continues on" "If you find a suspicious-looking mole and want to see a dermatologist, you can expect an average wait of 38 days in the U.S., and up to 73 days if you live in Boston, according to researchers at the University of California at San Francisco who studied the matter. Got a knee injury? A 2004 survey by medical recruitment firm Merritt, Hawkins & Associates found the average time needed to see an orthopedic surgeon ranges from 8 days in Atlanta to 43 days in Los Angeles. Nationwide, the average is 17 days."

One important note on our system's wait times is that, unlike in other countries, we don't collect the data. "There is no systemized collection of data on wait times in the U.S," says Business Week. "That makes it difficult to draw comparisons with countries that have national health systems, where wait times are not only tracked but made public." That's a side benefit of the universal systems, which due to their coherence and incentives, are actually quite transparent. That allows not only for an accurate assessment of the problems, but the effective deployment of resources to treat them.

And by the way, want to know which country has the lowest wait times in international comparisons? Hint: It's where sauerkraut comes from.

A Quick Note on Waiting Times

There are some arguments over comparisons of Canadian and US waiting times flitting through the blogosphere, which reminds me of a point I've been meaning to make for awhile: You can't compare the upper end of US waiting times to the upper-end of any other country, because those with reduced access to the health system forego care, which doesn't happen in significant numbers elsewhere. So while the Right disingenuously trumpets the few Americans reporting severely long waits, they don't mention that the group who would populate that category are locked out of care entirely.

Here's how the dodge works: If you look at waiting times, you'll see that relatively few Americans wait more than four months for surgery, which helps folks claim that America doesn't ration care, and makes our system look pretty good on the waiting times metric. Here's what they don't tell you: When you look at who foregoes care, the international comparisons reverse themselves. About 23% of Americans report that they didn't receive care, or get a test due to cost. In Canada, that number is 5.5%.

Worse, the American number is understated, as in order to know you need a surgery or further care, you need to go for an evaluatory visit, and as it happens, many Americans -- including 36 percent below average income -- aren't even seeking that. And it's this group -- which is largely low-income, and I'd guess, largely urban -- who would, in another country, be experiencing terrific wait times. Here, they never get care at all. The studies misleadingly write them out of the waiting statistics, making it look like America has low wait times when the relevant population is simply never getting care at all.

The Health of Nations

Some of you may remember the unimaginatively titled "Health of Nations," the series of explanatory posts I did on the health systems of other countries. That feature was when I was just dipping into the issue, and the appreciative reaction it received is undoubtedly what set me on the path to today's uncontrollable health wonkery.

In this month's American Prospect, I've turned the Health of Nations into a magazine feature, and I think improved on the original substantially. The article examines France, Canada, Germany, Great Britain, and the VA, and is more tightly focused on what renders their systems unique and the unique insights we can draw from each. I'm about as happy with it as any piece I've done, and I encourage folks to take a look.

Canada vs. America

If folks aren't following the debate between Jon Cohn and David Graetzer, they should check it out. Cohn is my fellow social democratic health-wonk-in-arms, while Graetzer is a Manhattan Institute libertarian type and so they, predictably, debating who gets better care, Americans or citizens of nations with universal systems. Graetzer has tried to focus the argument on high-level care outcomes -- if you get cancer, are you better off in America or England? -- but he's done so with oddly poor timing.

Even putting aside Jon's effective rebuttals, a new study was released today comparing care outcomes in the US and Canada. It addresses, in fact, the precise disagreement between Cohn and Graetzer, and does so on grounds that should be favorable to Graetzer -- Canada is often considered a fairly mediocre system. Yet, of the 38 studies examined, 14 showed clear advantaged for Canadian patients, five suggested US care was superior, and the remainder were mixed. The studies showing the Canadian systems superiority found effects both on income -- low-income Americans with breast or prostate cancer do much worse than low-income Canadians with the same conditions -- and care effectiveness. For conditions like kidney failure or cystic fibrosis, Canadian care was simply better. You can pick through the tables with all the results here.

It's not that the data shows unbelievable advantages for Canada, to be sure. As the authors conclude, "although Canadian outcomes were more often superior to US outcomes than the reverse, neither the United States nor Canada can claim hegemony in terms of quality of medical care and the resultant patient-important outcomes." The question raised is slightly different: How can we possibly countenance a system that costs twice as much as the Canadian system but delivers slightly worse care? Even assuming diminishing returns, our expenditures should result in care outcomes at least 20% or 30% better than Canada's. Instead, they're about 5% worse, but cost around 187%. Does it sound like we're getting a good deal?

We're...Not Number One

Jon Cohn has a very good article comparing America's health care system to those of other lands. Two parts I want to highlight:

• On technology:

Look at Japan. It has universal health care. It also has more CT scanners and MRIs, per person, than the United States. It's true that the European countries tend to have less technology (although Germany and Switzerland appear to be comparable or at least very close.) But their citizens get more of something else relative to Americans: Face time with doctors and time in hospitals. Take France, for example. As New York University's Victor Rodwin has noted, on a per capita basis the French get more physician office visits and more drugs than their American counterparts. When a woman in France gives birth, she gets to stay in the hospital for an average of nearly five days--even if it's a perfectly normal delivery. In the United States, on average, a woman with normal labor and delivery gets to stay less than two.

• On the argument that Americans get better care prostate cancer care (and thus, by extension, better care generally. We've gone through this one at great length):

Another wrinkle is that the comparisons look a lot different in you look at populations as a whole, rather than just those diagnosed with the disease. Yes, an American diagnosed with prostate cancer is less likely to die than, say, a German diagnosed with prostate cancer. But Americans on the whole are no less likely to die of the disease than Germans on the whole--and the same is true for most of the other well-developed countries in Europe. In fact, the percentage of the population that dies from prostate cancer is remarkably consistent between the United States and the most advanced European nations.

So what's the explanation? One possibility is that aggressive screening in the United States turns up a lot of slow-growing tumors--cancers that would not have ultimately killed people had they been allowed to grow. This seems particularly plausible in the case of prostate cancer. Simply put, the U.S. cure rate may look better than the rest of the world's because we're curing a lot of cancers that don't need to be cured.

No, we can't be sure about this. It's possible that, even accounting for such over-treatment, the United States still has better treatment for breast and prostate cancer. But, even if that were true, it's hard to read the data as indictment of universal health care when the U.S. survival rate on other ailments isn't so superior. The Swedes are more likely than Americans to survive a diagnosis of cervical, ovarian, or skin cancer; the French are more likely to survive stomach cancer, Hodgkins disease, and non-Hodgkins lymphoma. Aussies, Brits, and Canadians do better on liver and kidney transplants.

And all the usual caveats apply: They do it for less money, while providing universal coverage, etc, etc. We're spending twice as much as anyone else, leaving 45 million of our countrymen uninsured, and getting outcomes that are comparable or a bit worse. Moreover, as Jon argues in the first bit I quoted, we lose quite a bit in the availability of basic care and the amount of time we can spend with practitioners, which I can't imagine is a good thing. Indeed, America's got wonderfully advanced trauma care, but we're much worse at the preventative, basic stuff. And this is a question of medical culture. It's telling that hospital emergency rooms, where the most severe and urgent cases are treated with the most violent interventions, can't turn away the poor, while general practitioners, who can catch illnesses early and intervene cheaply, can send the destitute packing.

Throne-Kissers

I've spent a bit of time this morning puzzling over the meaning of a pretty opaque Jonah Goldberg post. It's my Tuesday timewaster! In it, he responds to Jon Cohn's smart article on the successes of the French health care system and my warning that the size of government isn't particularly determinative of economic growth by trenchantly asserting that, "[m]aybe, just maybe, France and Denmark can handle the systems they have because they have long traditions of sucking-up to the state and throne. Marty Lipset wrote stacks of books on how Canadians and Americans have different forms of government because the Royalist, throne-kissing, swine left America for Canada during the Revolutionary War and that's why they don't mind big government, switched to the metric system when ordered and will wait on line like good little subjects....maybe, just maybe, the reason America doesn't have a sprawling European welfare state is that America isn't Europe. And, unlike some of our liberal friends, Americans don't want to be Europeans."

My first thought is that that's a very serious, thoughtful, argument which has never been made in such detail or with such care. I smell a book contract! My second thought was: Huh? I'm not sure exactly what Goldberg thinks he's responding to, but it isn't anything Cohn or I wrote. For instance, apply his argument to Cohn's point on health care systems and it falls apart. America has multiple health care systems, some government-run, some privately administered. In every case, Americans -- who presumably aren't the "throne-kissing swine" of Goldberg's fevered imagination --report higher levels of satisfaction in the public programs. For instance, the elderly report 61 percent satisfaction with their health care system, which is government-run Medicare. The non-elderly, non-poor are about half as happy, with only 34 percent reporting themselves satisfied. Even the poor, who largely rely on Medicaid, free clinics, and the like are at 41 percent, higher than those of us in private care. Butwaitthere'smore!

The only truly socialized system in America is the Veteran's Health Administration. And surveys repeatedly and routinely find that they too are more satisfied with their care than those left in the private market. And anxious as I am to hear Jonah explain how our nation's veterans are just a bunch of toady throne-kissers, I'm not exactly holding my breath. So this one's back to you, Jonah: If America's culture renders us completely unsuitable for public health care systems, how come the vast numbers of Americans currently in public health systems seem so happy about it?

Also at Tapped.

A Picture's Worth a Thousand Words

The "complexity" of reform proposals is often used to diminish their chances of survival. But, aside from not being so complicated (everything's complicated if you drill sufficiently deep into it), they're mainly tough to absorb because we're taking in all the facets of the health care system at once. At the moment, we don't do that. So it's interesting to see the OECD give it a shot with our current system. The OECD collects data on the health structures of every member country, and here's their graphical representation of how financing works in ours. It's almost comical looking:

Simple, no?

In Which I Compare America's Health System To A Delicious Cupcake

By Ezra

I don't have a whole ton to say about the voucher schools argument going on between Matt, Kevin, and the newly-renamed McMegan. I'm pretty sure, though, that arguing this out through the frame of single-payer health care is almost certainly unwise, and you should probably, when talking about major changes in education policy, focus the discussion on education policy.

Moreover, Megan's claim that every liberal is for single-payer, but not Britain's NHS, is a bit misleading. Most people use single-payer incorrectly, so it's largely a misunderstanding, and they are in fact for nationalized health care, but not what's considered a bad example of it. A lot of us who aren't for the NHS are for the VA -- and both are single-payer systems, one's just better than the other. It's sort of like how I can be for Cakelove*, against those gross Safeway cupcakes, and broadly in favor of delicious baked goods all at the same time!

But look: This NHS bashing misses the point. In 2003, the British spent $2,231 per person. America spent $5,635. In other words, they spent 39% what we did. So whether they're "better" or "worse" is a bit hard to argue. Better or worse for what? They're certainly cheaper. And I've never, ever heard anyone argue that their health outcomes are 60% worse than ours. I would certainly prefer to get in a car accident in America, particularly if I had awesome insurance. But I'd certainly prefer to pay my health bills in Britain. And I'd really prefer if people stopped pretending you could make an apples-to-apples comparison between the two.

*This is actually a surprisingly robust analogy, because while Cakelove is delicious, it is way, way, way overpriced.

Health Care WrapUp

Having spent the last week of my life drowning in health care statistics and system comparisons (the products of which you can read here), I want to make a few wrap-up points on the whole thing.  First, I see why Clintons plan failed.  In an effort to avoid the political baggage of single-player, he tried to emulate Germany's system, which is really the worst of the bunch.  Complicated, bad at controlling costs, and obviously jury-rigged to accommodate an evolution that wasn't necessarily organized.  Bad move.

Employer-based health care, which Germany and Japan's universal systems rely on, is a poor choice.  There's no compelling fiscal or policy reason to use it, and employer's, frankly, should not be in charge of their worker's health care.  It's just a silly way of organizing it. 

Canada's system is too biased against the private sector; some degree of private, supplementary insurance should be allowed.  We do not live in an equal society and we've never had a problem with allowing the richest to benefit from their funds.  But if Canada's problem is that they have a ceiling, our problem is that we don't have a floor.  Liberals shouldn't construct a system that stops Americans from getting ever-better health care, but we need one that guarantees a certain level of care.  In essence, we want a floor without a ceiling. 

France and Britain are more interesting, Britain for their enormous cost control and France for the fact that their health care is really very good.  But Britain's frugalness has a price -- care simply isn't as good, surgeries are underused, medicines under-prescribed, and so forth.  While they still have better outcomes than we do, it's only because so many of our citizens are totally without access to health care.  If you had to decide where to be treated, you definitely want it to be here. 

France is more my speed.  Government provided, ceiling without floor, etc.  The lack of a gatekeeper leads to overuse (i.e, the French go to the doctor's too often), but that's changing their, and it could easily be side-stepped here.  What a shame, then, that France is so off-limits in political dialogue.  But whether or not we can invoke the French, they're the closest thing to a model structure out there, and we should study them for ideas. 

Moving beyond countries and into specifics, our doctors make too much money and we credential too few of them.  The road to an MD is torturous, inefficient, bottle-necked and enormously, enormously expensive.  It's such a terrible path that high pay is the least we can do.  But the AMA has codified this absurd state of affairs, and serious reforms will need to chip away at it.  Doctors either need to make less, or we need to radically increase the usage and training of nurse practitioners.  One way or the other, we need cheaper general providers who don't have crushing debt they need to pay off.  To achieve the last, the government needs to step in and subsidize medical training.  That shouldn't be hard, our public universities do it, to some degree, already.  It's time to radically increase the degree.

What really leapt out at me during this series was how normal government provided health care is.  Other nations have doctor choice, hospital choice -- in France, they don't even have limits on specialist choice.  Americans have somehow fooled themselves -- or been fooled -- into believing that government-run health care is somehow different from what they enjoy now.  I genuinely believe they carry some sort of dystopian vision around with them, of gray waiting rooms and faceless bureaucrats and bread lines with stethoscopes, rather than grain, at the front.  In order to keep that prophecy whole, they've had to mentally classify medicare as some weird, third sort of category -- government paying for private health care. 

Medicare, of course, works great, and its beneficiaries are enormously pleased with the service.  it doesn't seem like government-run health care because, well, it's like normal health care, only the government pays.  We need to use that.  Which is why my vote for health care reform would be a radical expansion of Medicare, almost exactly along the lines of what Ted Kennedy has proposed.  Americans need to be assured that government run health care is not, in some weird way, a wholly different state of affairs.  They need to know that it's the health care they enjoy now, just better, cheaper, and guaranteed.  Medicare, because it's already used and liked, comes with those benefits. 

Lastly, all my comments are on the structure of health care systems.  There are many other problems too, the rapid advance of technology and ever-longer life spans chief among them.  Changing our structure won't solve those issues.  But our dysfunctional system currently makes them worse.  The poor get care, but only once the situation is catastrophic and the costs of healing them have drastically increased.  We pay too much, get too little, and remain tied to bad jobs because we can't sacrifice our coverage,  In the end, our health care system is a lead weight on employers, a shackle on employees, and a great drag on our economy.  It's not the best in the world, it's not near it, and we shouldn't pretend otherwise.  Instead, we should set out on the task of making it better.

Health of Nations: Japan

It's Friday, I've got to run to the airport in an hour, and the shower beckons (actually, demands). But before all that -- Japan! Also, in response to popular demand, I've grouped the series into a separate "Health of Nations" category. Collect all five!

Da Basics: Japan's health insurance is another one of these employer-based systems, and has been since 1922. Universal insurance was achieved in 1961, through the National Health Insurance Act. Employers with 700+ employees are required to operate insurance plans for workers and their dependents. The plans are called "society-managed insurance". About 1800 of these employer-run plans exist, with 85% of them being single company programs and the balance being jointly administered by two or more companies. The boards of these plans are 50% company reps and 50% worker reps, much like in Germany. Dependents are required to enroll in the plans and the whole thing is funded through payroll taxes. These employer-based, "society-managed insurance" groups cover 26% of Japan's population.

Employees and dependents in companies with fewer than 700 workers are automatically enrolled in the small business national health plan operated by the government. This plan covers about 30% of Japan and is paid for by both payroll taxes and general fund revenue.

The third category of insurance is the "citizens insurance program", which covers the retired and the self-employed. The plan is administered by municipal governments who levy a compulsory premium on the self-employed in their districts. Further, the employer run health care and the government run small business system are both required to contribute to the citizens program in order to cover the retirees. The contributions from the other two programs cover about 40% of the citizens insurance program costs. Any further amount needed comes from general revenue.

A variety of small insurance programs exist to mop up the folks between the cracks, government workers and various other special occupations use them. The unemployed remain in their employer's program (or whichever program they were in before) with the payroll contribution waived. All plans are required to cover a range of benefits, which include dental care, maternity care, and prescription drugs.

The plans place no restriction on hospital or physician choice and have no preauthorization requirements, i.e, no gatekeepers (save in certain, rare cases). Japan has a much more independent class of physicians, with most clinics and small hospitals being family-owned and operated by independent doctors -- a far cry from our non-profit and private-based care. The government builds and operates the large medical centers, though the distinctions are size rather than care. Small clinics can have hospital beds and multiday care, the distinction between clinic to hospital is simply having 20+ beds.

Hospital stays are longer in Japan but surgery is only 1/3rd as prevalent, mostly owing to a resistance towards invasive procedures. Nevertheless, patients stick around longer -- an average of 33 days in the hospital -- and are allowed to convalesce there.

Payment for both hospitals and clinics is done on a fee-for-service basis. Government regulates the fees, as well as prescription prices, with the help of the Central Social Insurance Medical Council. In Japan, primary care services are often more expensive than specialized care services, an inversion of most countries. Physician visits are often brief, but the Japanese hit the doctor's office 2.5 times more often than do Americans, Canadians, Germans or the English.

Cost Control: Like in the UK, Japanese health care is cheap, clocking in at a mere 7.6% of GDP. Put another way, Japan spends a bit less than $2,000 per capita on health care, America spends more than $5,000 despite not covering 43 million of its citizens. Problems are cropping up, however. Japan's got one of the most long-lived populations in the world, in addition to a quickly-dropping birth rate. By 2020, the proportion of Japanese of 65 should be about 26%, up from 10% in 1986. That's trouble. Americans, by contrast, are only supposed to see a 4% increase in codgers during the same time period.

To stem riding costs, Japan raised their copay from 10% to 20%, though the elderly were exempted from copaying for prescription drugs. Copays, however, are ineffective at limiting costs, they were capped at $500 a month, and so they did nothing to help on the costs -- mainly due to catastrophic illness -- that're hurting the system. So Japan is cheap, but having cost problems.

How Do We Stack Up? Japan is 8-11 (three way tie) on fairness of cost distribution and #1(!) on attainment of health care goals. Their system's performance, overall, puts them at #10. America, to compare, is 54th in fairness(!), 15th in goal attainment, and 37th in overall performance. All that and we only have to spend a bit over twice as much to get it! What a deal!

And that just about brings this little series to an end. On Monday, I'll have some longer thoughts for you on what this says about American health care and what I think we should be fighting for, so stay tuned for that. If you ever want to refer to these posts again, they're all grouped under the "Health of Nations" category, which you can access on the sidebar. Hope you liked.

Health of Nations: Germany

It's been a long day, I desperately need some coffee, and it's really hot in my room. So you wouldn't believe how excited I am to dive into yet another country's health care structure. Let's just say I love you all very, very much. For those who've missed the previous three days of health wonkery, check out France, England and Canada. Today is Germany which, fun fact, Clinton Care was based off of.

Da Basics: Germany was the first nation to enact mandatory health insurance, doing so way back in 1883. The system is funded through employer contributions, with half the money coming from your paycheck and half coming from your employer. Participating Germans -- about 90% of the country -- are enrolled in "sickness funds", some of which are organized by geographical region, some of which are organized by trade, and some of which are organized by company. The funds are a mix between private and public entities and are all nonprofit. They can't discriminate, and can't charge customers at different rates corresponding to their health/age/lifestyle. That means no cherry-picking.

Various sickness funds have different contribution levels (so some will deduct 7% of your paycheck, others 8%), but all are required to cover a broad range of benefits (including prescription drugs) and demand only a modest copay. These funds, which are conducted through your employer, remain with you even after you lose or retire from a job. So if you're fired, your employer will still have to make contributions for you, but the government will take up your end of the bargain. Same deal if you retire, though in that case the sickness fund covers a bit less of your expenses and your retirement pension makes up the gap. The funds are administered by a board that's half company representatives and half worker representatives.

Insurance is mandatory for all Germans with incomes under $40,000. Those above can opt out, but few do. All told, about 8% of the country opts out of the sickness funds, and most of them are very wealthy. Private insurers pay doctors at much higher rates, and thus the folks they insure get preferential treatment. This way, the rich can pay for better service, unlike in Canada where the only way to attain kingly treatment is paying out of pocket in America. 2% of the country are covered through the armed forces or policy, and .2% of the country -- mostly the superrich -- have no insurance at all.

The financing method is pretty regressive. The sickness funds can vary the percentage of your paycheck they deduct under the rationale that those with larger earnings need a smaller percentage to cover expenses. So the idea is not to have the rich covering the poor, but for everyone to be covered. Eventually, however, this got out of hand and a slight reform was made: Because various sickness funds draw from differing slices of the population, some were requiring quite small percentages to run the fund, as they had healthier, richer enrollees, while others needed quite a chunk because they covered poorer, sicker demographics. So in 1994, Germany created a program that forced sickness funds with richer, healthier members to contribute a portion of their payroll revenues to a national pool, which then distributes it to the poorer funds. That means the financing is still regressive, but less so.

Germany's not traditionally been a gatekeeper system, but that's changing. Nowadays, 55% of their doctors are generalists, compared with 35% of American physicians. Non-hospital (ambulatory) physicians are required to join their regional associations, which pay them from a global fund. If the physicians bill beyond what they're budgeted for, fees are reduced in proportion to the excess spending the next quarter. This seems to present a problem, in that some physicians could over-prescribe and force others to under-prescribe, as no particular physician would know what his colleagues were doing and thus be able to judge what he could do. Whether the associations have a way of evaluating physicians individually I don't know. Otherwise, the system seems flawed as doctors lack necessary cost information.

Cost Control: The 1977 German Cost Containment Act created a body called "Concerted Action", comprised of representatives from the nation's health providers, sickness funds, employers, unions, and various levels of government. CA meets twice a year to set guidelines for hospital fees, physicians rates and so forth. Since 1986, physician's fees have been capped. As a result, their health spending actually feel a bit between 1986 and 1991. But in 1991, costs resumed their march upwards, so the German government tried to make the Sickness Funds more competitive by allowing greater flexibility in choosing them. This heightened the inequality, forcing the aforementioned law transferring wealth from healthy, rich sickness funds to worse off ones. As of 2001, Germany's health spending was at 10.7% of GDP, third highest in the world. America, for comparison, is #1.

How Do We Stack Up? Due to some concerns over the viability of GDP spending and OECD rankings, I'm going to be changing some of the metrics I use here. Per capita, Germany spends $2,817 on health care for its citizens. America spends $5,267 (which in unbelievably high, by the way -- you should really check out how nuts that is, a point well-made by this Excel file comparison). According to the WHO, Germany's health care system is #6 in fairness of financial burden, #14 in overall goal attainment, and #14 in terms of overall performance. America's system is 54th in fairness(!), 15th in goal attainment, and 37th in overall performance.

Sources: Thomas Bodenheimer's Understanding Health Policy, WHO data,

The Health of Nations: Oh, Canada!

Next on our tour of health care systems would have to come Canada. I've been debating whether or not to do them because their setup is so well-known, on the other hand, it's also something of an anomaly that's often romanticized to a degree it shouldn't be, so it seems worth the effort. If you're new to the series, you can find France here and England here. Off we go.

Da Basics: Canada care is unapologetic, no-holds-barred single-payer. The single-payer, by the way, is not Canada as a whole, but each specific province, so it's not quite as monolithic as we think. It's financed by taxes, but the taxes vary from province to province, so there is a certain amount of variation in how the system pays its bills. But I'm going to stay away from that -- keeping you guys still for health policy is dicey enough, if I start throwing in tax policy, my blog will have tumbleweeds blowing through it (and maybe a shoot-out in the saloon, but that's another story).

Like England, Canada's insurance has nothing to do with occupation, age, citizenship, or any other variable. If you're on the grounds of our Northern neighbor, you're covered. The system covers everything, though drug benefits and long-term care vary a bit across provinces. What's interesting about Canada's incarnation of single-payer, though, is how pure it's kept. France and England, as we saw, both have a significant role for supplementary insurance beyond the government's basic offering. Not so in Canada, where add-on insurance isn't even allowed. That makes for a remarkably level playing field. Care varies only according to province (and, assumedly, individual doctors and hospitals), not according to class. Interestingly, low-income Canadians actually receive more care than do the affluent, owing to the higher rates of disease in poorer communities.

To be clear, there is a little bit of supplementary insurance floating around, but it can only be used for certain amenities, like private rooms. Hospitals are simply not allowed to bill private insurers for services covered by the provincial plans. So say nighty-night to the private sector.

Canada is a gatekeeper system, and 55% of their doctors are general practitioners playing that role. Specialists can see patients without a GP referral, but they don't receive the highest compensation from the government and so most won't do it. As that alludes to, Canada's doctors are paid on a fee-for-service basis, so there's no incentive (a la Britain) to withhold treatment. Hospitals, on the other hand, negotiate a global budget with provincial government, which is to say they get a lump sum rather than a fee-for-service. That makes adapting to changing circumstances or varying needs harder than it'd otherwise be, as the money is allocated from the start, rather than in response to circumstances.

Cost: In 1970, the year before Canada's health care system came online, Canada and the US spent about the same on health care, 7.2% and 7.4% of GDP respectively. By 1990, it was 9% and 11.9%. And by 2002, it was 9.6% and 14.6%. So while our health care spending shot up by 7.6% of GDP and still doesn't cover out citizenry, theirs had a 4.5% climb and got everyone in the goddamn country covered (remember: the first number is pre-universal health insurance). During the 90's, Canada's health care costs (as a % of GDP) actually dropped. Dropped! And these differences aren't a result of fewer services rendered. Indeed, Canadians, on average, spend more days in the hospital and have more visits with their physicians than Americans do. The lower costs are accounted for by three things:

1) Lower administrative costs. This one will blow some minds. Despite being a bureaucratic leviathan or whatever, America's administrative costs are 300% greater per capita than Canada's. So much for the vaunted efficiency of the private market.

2) When Canadians do spend a day in the hospital, it's much cheaper. Costs per patient per day are quite a bit higher on our side of the border.

3) Physician's fees and pharmaceutical prices, which are way higher on this side of the border.

The fiscal austerity of the 90's, which helped drop costs of the program, did make for a worse health care system, or at least one that netted less satisfaction. Wait times for elective surgeries increased, though it should be noted that Canadians wait, on average, less time for vital operations such as transplants. Oh, and the "hordes of Canadians rushing across the border for care thing"? Mostly myth.

The only verified cases are a) folks in the US on vacation or b) folks who don't want to wait for an elective procedure and can pay to do it out of pocket. Think about that for a second -- the primary criticism of the Canadian system is the "wait times/they come here" combo, but what's really going on is a prioritization of procedures and a few rich folks deciding not stand in line. So in Canada, it's the rich who can't get the care they want, but everybody can get the care they need. Here, the rich can get all the care they want, and many of our poor and lower-middle class can't simply wait in line for elective procedures -- they simply can't get them. It's all about priorities.

Recently, the Canadian government, In response to the drop in citizen satisfaction, substantially increased the program's funding (by $33 billion, I think) and began some restructuring. The effects of those changes aren't in yet, as they were just passed in 2003.

How Do We Stack Up? In simple ratings, Canada is 30th while we're 37th (according to the OECD). So they're a bit better, but it's not like the giant disparity we had with France, whose system takes the coveted top slot. As noted above, the Canadian system is significantly cheaper as a percentage of GDP than is the American system, despite the fact that the former covers everyone and the latter leaves a fair chunk of its population out in the cold. On the years of life lost metric, American women lose 3,836 years per 100,000 women and the men give up 6,648. The comparable Canadian figures are 2,768 and 4,698 respectively.

Canada's health care system, much more so than the others we've looked at, is a pure single-payer effort. It's really run by the government, private insurance is barred from interfering in any significant way, and so on. And despite the vaunted inefficiencies of government, they manage to cover their entire population with administration costs that're 300% less than ours per capita. Considering that 42 million of our folks aren't even in the system, the difference is even greater than that. Much of it comes from the simplicity of having the government pick up the tab rather than forcing doctors to haggle with insurers, but not all. In any case, that metric blows my mind.

In any case, Canada's got some problems. Wait times for elective surgeries can suck real bad and, according to an LA Times article from April 10th, some folks do cross the border to speed things up. But vital procedures are done quicker and, amazingly, any Canadian can get any necessary surgery done that they want. If elective, it may take some time, but there's never a question over whether they'll be treated. So next time someone goes off on Canadians-in-line to you, remember: the question they're facing is whether to allow the rich to pole vault over the poor. America looked at that calculus and chose the rich; our poor don't have mere waiting times to face, many of them simply can't get any non-emergency medical care. That doesn't happen in Canada, and it doesn't happen because their system is aimed at never letting it happen. Frankly, if our uninsured knew they could do it, it'd make much more sense for to flee to Canada for treatment than it does for the Canadian rich to cut their wait times by paying out-of-pocket here.

Sources: LA Times articles from Lexis-Nexis, Thomas Bodenheimer's Understanding Health Policy, OECD data sets, Matthew Holt.

The Health of Nations: England

Welcome to the second installment of The Health of Nations (though it's the first one to sport a clever title).  I'm your host, Ezra, and I'll be taking you on a deadly-dull tour through England's health care system.  An uninteresting topic set in a country known for its dullness, should be a party.  And speaking of the party, you don't want to show up not knowing anybody.  So if you missed yesterday's edition on France, you might want to give it a look-see.

Da' Basics: Britain's health care system finds its roots in a document called the Beveridge report.  The report argued that the health care system Britain had in the 40's -- which covered about half the country and used political patronage as its sorting mechanism -- should be combined with the rest of the country's fragmented social programs and administered in a uniform way.  Thus the National Health Service was created.

The NHS is mostly funded through taxes -- 82% of it is, to be exact.  Of the remaining, 13% comes from employer-employee contributions (much like Social Security) and 4% is user fees.  Unlike France, Britain's health care system is entirely separate from employment, and there's no distinction between its social insurance aspects (covering those who contribute) and its public assistance aspects (covering those who need it).  The system simply takes care of everyone on British soil. 

Unlike Canada, Britain allows supplementary insurance for those wanting special treatment (shorter waits, private rooms, etc).  It's not nearly so widespread as in France (where 90% have it and the poor get it through public subsidies), but 11% have some form of SI and many jobs offer it as a perk.  To accommodate this, doctors can have both private and public practices, meaning they can treat patients under public rules complete with queues for non-pressing procedures while, at the same time, be performing the same procedures with quick turnaround for those with supplementary private insurance.  This obviously creates a certain degree of inequality in the system, and, indeed, it's a source of widespread discontent.

The NHS has a gatekeeper system in which every person who wants treatment must have a general practitioner (GP) as their primary care physician.  Patients can choose their PCP, and even switch if they don't like their choice.  The GP's get paid via a small monthly sum per patient (capitation), not adjusted for services rendered.  This is basically community rating -- GP's have long lists of patients, most don't need anything in particular during the month, so the small payment is pure profit on the majority of patients, who never come in, and thus covers the losses on the patients who do come in.  Since GP's get more money for more patients, they've an incentive to keep huge lists of people.  Since patients choose their GP, however, the GP theoretically can't cherrypick patients by looking for only the healthy ones.  But GP's can turn patients away by saying their list is full, so it seems possible that some degree of cherry-picking can go on.

Cost Control: I'm giving this it's own category because it's both what's right and what's wrong with the British system.  The NHS is a remarkably frugal operation.  Health expenditures in the UK accounted for 7.6% of GDP in 2002; in America, they were 14.6%, or almost double Britain's expenditure.  The cost differential comes from a few places.  First and foremost, single-payer systems are able limit budgets and negotiate better deals.  Further, the mode of reimbursement, capitation rather than fee-for-service, is much cheaper and carries with it a disincentive, rather than incentive, to treat.  In fee-for-service systems, the doctors get paid more if they run tests, perform surgeries, etc.  That leads to a certain profligacy, a willingness to advocate treatment when the patient may not need it.  On the other hand, capitation brings the opposite problem: an unwillingness to order treatment when the patient may need it.  As a result, the UK rate for coronary artery bypass surgery was only 20% of ours, renal dialysis is performed far less often, and there are significant worries about underprescription.  That's not to say everything is rationed, but much is.

Further, the capitation system has led to a severe shortage of doctors, with only 2 for every 1,000 people, far below the OECD average of 2.9 and the EU average of 3.3.  The lack of doctors and the paucity of funds have also led to long waiting times; 38% of patients wait more than four months for elective surgeries.  The basic issue is that, as Blair has admitted, the British health care system is severely underfunded, partially because Britain's got a low GDP per capita (though I don't think he admitted that part).

Interestingly, the NHS has become a major political football.  Check out the Labour splash page.  Every voter who heads to the Labour website is first greeted by a scare ad showing how much the Tories want them to pay for hospital procedures.  The main site prominently touts the improvements Labour's made to the speed of the system and the number of doctors, particularly specialists.  So, though cheap, the NHS is underfunded and providing relatively poor service and Britons know it. 

How Do We Stack Up?:  As noted above, America's health care system is much, much more expensive that Britain's, but also less generous.  But does that affect the outcomes? 

Yes, but only if compared to a functioning health care system.  When stacked up against ours, Britain's broken system still comes out on top.  American women lose 3,836 years of life per 100,000 while our men lose 6,648.  By comparison, British women lose 2,947 and their men sacrifice 4,815 (go here to see how this is calculated).  On the other hand, they have longer wait times and fewer doctors.  The disparity comes because America's system works okay for most, but not at all for many.  Britain's, by contrast, offers mediocre service but offers it to everyone in the country.  If they injected their health care system with the sort of cash we pump into ours -- which'd mean spending the equivalent of 7% more of their GDP on it, it's safe to say we'd be beaten quite handily. 

Sources: I stupidly closed some windows and so don't have as full an accounting of my sources as I did yesterday.  But I mainly used Thomas Bodenheimer's excellent Understanding Health Policy, OECD data sets, and the British government's websites. 

Health Care: France

Because the blogs are populated by that rarest of above-ground breeds, the policy nerd, there's been a lot of talk lately about the health care structures of various other countries, how they stack up with ours, and why we lose. What there hasn't been is much information on how these other countries actually work, save for "better" and with "more government". Since I have a very peculiar idea of what "fun" is, I'm going to try and correct that. Each day this week I'll be writing a bare bones guide to another country's health system so when you're discussing say, France, you know how it works rather than that it simply works better than ours does. Speaking of France, I'm going to start with them, because they've gotten the most attention recently. Tomorrow I'll do England, the next day Germany, Thursday will be Australia, and Friday we'll do Canada. It'll be fun, I don't promise. Alright then, off we go:

France:

Da' basics: France has a basic system of public health insurance that, as of January 2000, covers everybody in the nation. Before then, portions of the population lacked insurance. The reimbursement rates are wholly uniform, despite the fact that there are actually three health care funds, a main one covering most workers, and then one for the self-employed and one for agricultural workers.

As that hints, the health care is occupationally based. It's paid for through employer and employee contributions (much like Social Security), in addition to personal income taxes. The latter have been increasing in recent years.

The funds are private entities under the joint control of employers and unions, which are in turn supervised by the state. As might be expected, that doesn't work particularly smoothly, and there's a constant battle for authority and control. Creative tension, one might kindly call it. The funds are mandatory, no one may opt-out, and they're not allowed to compete with each other nor micromanage care.

The public system covers around 75% of total costs. Half of the rest is paid out-of-pocket and the remaining is made up by supplementary insurance companies. About 85% of the French have some form of private insurance, which pays for the various procedures and equipment the public insurance doesn't wholly cover. This of course led to inequality, so in January 2000, a means-tested public supplementary insurance program came online in order to ensure that the poor got top care.

France is the only country where access to care is unlimited. Patients can see as many doctors as they damn well please. They don't need referrals to see specialists, and there's basically no gatekeepers at all (this is going to change, recent reforms mandate a principal doctor -- a gatekeeper -- if you want full reimbursement).

The health care system is mainly under state control. The state plans out hospitals, the allocation of specialized equipment, etc. Some of this is done at the regional level, a trend which seems to be increasing. The hospitals offer about 8.4 beds per 1,000 people (America, btw, offers 3.6. Ouch.) The public sector provides 65% of the beds, private hospitals -- which operate on a fee-for-service basis -- make up the rest, and primarily concentrate on surgeries. French citizens choose which one to go to and get the same reimbursement at either. How's that for choice? Not good enough? The French also get to choose their physicians, their physicians get to choose where they practice, and there's patient-client confidentiality.

Problems: France still has class and geographical disparities in their health care outcomes. They're not nearly what ours are, but they exist nonetheless. In addition, various hospitals offer varying levels of care, health costs are rising (again, not as much as here, but still significantly), and physicians often don't feel they're paid enough for their services, leading to a number of recent strikes. As it is, French physicians only make US $55,000, about 1/3rd what their American counterparts pull in.

Yes, but are we better? Right, you say, that's all very not interesting. But how do we stack up with France? Better? Worse?

Yeah, the second one. France's health care system bodyslams us on most every metric. Beyond the beds per 1,000 stat mentioned above, France has more doctors per 1,000 people (3.3 vs. 2.4), spends way less, has 3.2 more physician visits per capita (6 in France vs. 2.8 in America, which probably accounts for the better preventive care in France), has a much higher hospital admission rate, and beats us handily on the most important measure: potential years of life lost. American women lose 3,836 years per 100,000, while American men give up 6,648 in the same sample size (yes, we get screwed). In France, the comparable numbers are 2,588 years for the women and 5,610 for the men. Still not great, but quite a bit better.

So France spends less, gets more, and does so through a public-private hybrid that's heavily, heavily public. Socialized medicine sure is scary.

Sources:
A Conservative Convert to Socialized Medicine by David Burgess. Link.
OECD frequently requested data. Link.
The Health Care System Under French National Insurance: Lessons for Health Reform in the United States by Victor Godwin. Link.
The French Health Care System. Link.
French Health Care Reform: A Step in the Right Direction by Claudia Broyer. Can't find the link.

Update: Big ups to the new readers finding this post. We'll be doing different countries all week, so y'all come back now, y'hear?