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From Health Law Daily, October 9, 2015

U.S. saw poor health outcomes despite astronomical health care spending

By Mary Damitio, J.D.

Despite spending more per person on health care in 2013 than 12 other high-income nations, the U.S. saw some of the worst health outcomes and the lowest life expectancy out of the group. A report released by the Commonwealth Fund found that while the U.S. had the lowest mortality rates for cancer, it had higher rates for chronic conditions, obesity, and infant mortality than the other countries that spent far less on health care. However, the authors noted that the data used for the study predated the major insurance provisions of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148).

Study. The Commonwealth Fund analysis, which examined health care spending in 13 high-income countries, found the U.S. to be a “substantial outlier,” with such spending consuming 17.1 percent of the country’s gross domestic product (GDP), which was 50 percent more than any other country. The U.S. spent the least on social services such as disability or employment programs, and was the only country where health care spending accounted for a greater share of its GDP than other social service spending. Also, despite being the only country examined that did not have universal health care coverage, the U.S. government spending on Medicare and Medicaid was high at $4,197 per person as compared with the U.K., which spends $2,802 on every resident, all of whom are covered by the National Health Service.

Health outcomes. The study found that the U.S. performed well in providing cancer care, with the rates of deaths attributable to cancer being lower in the U.S. than in other countries. The U.S., however, had higher rates than other countries for chronic conditions, obesity and infant mortality.

Reasons. The high rate of U.S. spending can be attributed not to higher instances of patient visits to doctors or hospitals, but, rather, to higher health care prices and greater use of medical technology in the country. While Americans were found to visit doctors and hospitals relatively infrequently, they did receive the most diagnostic imaging exams out of all the countries examined. Additionally, the average U.S. adult takes more prescription drugs than in all of the countries examined except for New Zealand, and the cost of those prescription drugs are more expensive in the U.S. than in other countries, with prices being twice as high than in the U.K., Australia, and Canada. The study also found that prices for health services were much higher in the U.S. than in any other country.

Future spending. The study’s authors noted that the high level of health care spending has far-reaching consequences for the U.S. economy, and will affect wages and personal finance well-being. However, new health care spending models, such as accountable care organizations (ACOs), which were established by Section 3022 of the ACA, and base provider pay on patient outcomes, could lead to higher-quality health care at lower costs. Additionally, it is hoped that these models could shift spending to social services because health care organizations will be incentivized to take a more broad approach to patient health care.

Companies: The Commonwealth Fund

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