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Surgery Grand Rounds
               Robert Wolfson, MD, MSHA
Healthcare Systems: History, Management & Policy




                                         April 20, 2009
Comparative Analysis Of
National Healthcare Systems
www.wolfsonconsulting.com/grandrounds




                                 April 20, 2009
Healthcare Crisis!
 quot;Report puts U.S. health care with
    industrialized world's worst.quot;
            (Family Practice News, 2008)
 quot;The Coming Healthcare Collapsequot;
   Obama Health Plan Unafforable: Income
     tax to rise by 90%!
            (Robert McIntosh: 4/14/2009, A.P.)
 quot;The Healthcare Crisis in Americaquot;
            (Families USA – 2007)
4/20/2009                                        3
Healthcare Crisis!
 quot;Lack of health insurance causes 18,000
    unnecessary deaths every year.quot;
            (Institute of Medicine, January 14, 2004)
 quot;To Err is Humanquot; (IOM, 1999, 2003)
   quot;44,000 – 98,000 People Die Each Year
   In Hospitals as a Result of Medical Errorsquot;
 16%, or 43 Million Americans
   Have No Medical Insurance (CDC)
4/20/2009                                               4
4/20/2009
What’s Going On Here?
 Is This Problem Unique to the U.S.?
 How Do Healthcare Systems Function In
    Other Comparable Nations?
        Where Should We Turn For Examples
        With Our Healthcare Reform Efforts?
 This Morning:
 Compare U.S. Healthcare System With Healthcare
   Systems In Other Nations

4/20/2009                                     6
Topics
 1.         Define Terms & Methods
 2.         Evolution - Health Systems OECD Nations
 3.         Health System Models & Examples
 4.         Consistent Differences
 5.         Current Healthcare Debate
 6.         Discussion


4/20/2009                                        7
Terms
 I. OECD
 II. Healthcare
 III. Analytic Methods: quot;Systems Theoryquot;
 IV. Healthcare System
 V. Individual Madate, Employer Mandate
 VI. Single Payer System


4/20/2009                                  8
I. OECD:
Organization for Economic Cooperation and
   Development
      30 Countries Committed to 'Democracy & the
         Market Economy'
      Began in 1921, Expanded in 1960's
In the 20th Century, All OECD Countries
Extended Government‟s Role in
      Financing & Organization of Health Services

4/20/2009                                           9
OECD - 30 Countries
20 Nations Initially: (1921)
   Austria, Belgium, Canada, Denmark, France,
   Germany, Greece, Iceland, Ireland, Italy,
   Luxembourg, Netherlands, Norway, Portugal, Spain,
   Sweden, Switzerland, Turkey, U.K., U.S.A.
+ 10 Later:
   Australia, Czech Republic, Finland, Hungary,
   Japan, Korea, Mexico, New Zealand, Poland,
   & Slav. Repuplic
  4/20/2009                                       10
II. Healthcare
 All Goods & Services Delivered
   Designed to Promote Health
 Including:
   • Preventive, Curative & Palliative
      Interventions
   • Directed to Individuals & Populations


4/20/2009                                    11
III. Methods
 Healthcare Systems Can be Compared
   Using Different Disciplines, or Methods:
   1. Sociology:
            Distribution of Care per Sociologic Group
        2. Economics: Most Data Available
        3. Systems Theory:
            The Most Comprehensive


4/20/2009                                               12
Systems Theory:
 quot;The Study of the Nature of Systems
   In Nature, Society and Sciencequot;
 A Framework by which One Can Analyze A
    Group of Objects,
   Working in Concert To Produce a Result
 Examples of Systems:
   Cell, A Method, quot;Cardiovascular Systemquot;

4/20/2009                                    13
Characteristics of Systems:
 1. Separate Objects
            Acting as an Integrated Whole
            Often Reach Functional Equilibrium:
            (Closed Systems)
 2. Objects in Systems are often Grouped into
    Categories:
            Input, Processing, Output, Feedback
 3. Parts of Systems Have:
            Functional & Structural Relationships to Each Other

4/20/2009                                                     Slide 14
IV. Healthcare System
 = All Resources Dedicated to Providing
        Healthcare Services to Populations, Nations
 Include:
        Patients, Providers,
        Methods, Treatments
        Institutions, Organizations, Buildings
 Acting as an Integrated Whole to Provide
        Healthcare Services to Populations &/or Nations

4/20/2009                                             15
Healthcare Systems
Inputs: Funding, Patients, Physicans
Throughputs:
       Healthcare Organizations, Treatments
Outputs: Outcomes, Payments to Providers
Environment: Physical Environment,
       Health Of Individuals & Community
Feeback:
       Patient Health, Satisfaction, Health of Community
4/20/2009                                            16
Healthcare System Model
                         Feedback


Input:
                                                        Output:
                          Throughput:
$$$, Patients, Suppli
                                                   $$$, Patients
                         In Pt. & Out Pt.
es,
                                             Clinical Outcomes,
                            Services,
Information
                                                    Information
                           Information




                        Environment
                People, Wellness, Illness, Risks
                                                                  17
    4/20/2009
Terms (cont.)
 V. Individual, Employer Mandates:
    Individual citizens are required to have
       health insurance, one way or another.
    Employers are required to provide health
       insurance to employees.
 VI. Single Payer System
    Payment for all Healthcare Expenses
       comes from a Single Source or Fund.
4/20/2009                                      18
Evolution of Health Systems
 In U.S., Before & During World War II:
    Labor Shortage,
    Freeze on Prices and Wages
 Employers Allowed to Offer Health Insurance
    As a Tax Deductable Benefit to Employees
 = Subsidy to Employers & Employees


4/20/2009                                 19
Following World War II:
Western European Nations & Japan:
 Had to Rebuild From Scratch
 Developed National Health Systems
            Through Socialist Governments
United States Chose Not to Build
  A National Health System, But
  Provided Subsidies to Their Healthcare
     System
4/20/2009                                   20
U.S. Subsidies
 Hospitals:
        Hill Burton Act – Funding For Hospitals
        Many Hospitals Granted Tax Exempt Status
 Training of Health Professionals
        Subsidized Through Governmental Grants
 Employer-Sponsored Health Insurance:
        Remained Tax Decuctible
 1960's: Medicare, Medicaid
4/20/2009                                          21
Health System Models
 I. National Health Service (NHS)
 II. National Health Insurance (NHI)
 III. Mixed Funding, Mixed Coverage
     Pvt. Insurance + Government Funding
     Coverage is Not Universal



4/20/2009                                  22
I. National Health Service (NHS)
  quot;Nationalization of Healthcarequot;:
            Including Providers, Facilities & Services
  Universal Coverage, Single Payer
  Financing From:
            Income Tax, General Taxes & General Fund
  District Budgets
    Are Used to Control Spending

4/20/2009                                                23
Characteristics: NHS
 Patients seen in Public Hospitals & Clinics
            Physicians work for NHS
 Countries Include:
            Great Britain, Sweden, Norway,
            Finland, Spain, Italy, Greece
 Private Practices often Allowed


4/20/2009                                      24
United Kingdom:
 Population: 61 Million
 Life expectancy at birth: 79
 Health spending as % GDP: 8.3%
 Coverage: Universal
 Management: Government
 Hospitals: Owned by Government
 Physicians: Paid Salary by Government
        Receive Fees from Private Insurance, Patients
4/20/2009                                               25
U.K.: Spending
Health Spending per capita per yr.: $2,580
$ 2,245 (87%) From Government
   $335 (13%) From Individuals
            For Supplemental, Private Insurance,
            Payments to Doctors, Self Pay for OTC drugs
Prescription drugs:
      1/2 Population Receive Drugs for Free,
            Exemptions: Age, Disability and Pregnancy

4/20/2009                                                 26
U.K. (cont.)
 Notable features:
 1. Patients do not receive Bills:
        Or Insurance Premiums
 2. National Inst. Health & Clinical Excellence:
            Advice For Treatments & Drugs to be Covered
 3. Challenges:
        Inefficiencies, Old Infrastructure, Waiting Times,
        Unequal Distribution of Resources Among Districts.
        Professor Sir Bruce Keogh, 2/2/09
4/20/2009                                                    27
II. National Health Insurance (NHI)
= Nationalization of Health Insurance
May be Single or Multiple Payers, But
  There is Universal Coverage with
      Employer &/or Individual Mandates
Financing Comes From:
      Employment Taxes; Social Security
Less „Budgeted‟
      More Flexible form of Financing
Private & Public Hospitals/Clinics Exist
4/20/2009                                  28
NHI: Japan, France
 Individuals Buy Coverage:
        From Government Plan or Private Insurers
 Universal Coverage, Individual Mandate
 Consumers Pay Insurance Premiums
 Government Provides Subsidies for:
        • Elderly
        • Those in Need
        • Small Businesses
4/20/2009                                          29
Japan:
NHI; Financing: Public & Private Insurance
Universal Coverage;
Individual & Employer Mandate
       Funding: From Employment Taxes and Private
          Insurance Premiums
       ~ 4% of Salary => Nonprofit, Community-Based
          Insurance Plan.
       Public Assistance For Small
         Businesses, Elderly & Poor
4/20/2009                                         30
Japan:
  Population: 128 million
  Life Expectancy at Birth: 82.1
  Health Spending as % GDP: 8%
  Coverage: Universal
  Spending/capita/yr.: $2474
     $ 2053 (83%) From Government,
     $420 (17%) From Invividuals:
  Gov't. Controls on Pharmaceutical Prices
4/20/2009                                    31
Japan (cont.)
 Notable features:
        Frequent Doctor Visits; Long Hospital Stays.
        Insurers Must Cover Everyone; Can't Deny a
           Claim.
 Biggest challenges:
        Rapidly Aging Population. Overuse of Care.
        Highest Number of Hospitals/Person in the world.
        Shortage of Physicians in Many Specialties &
           Rural Areas.
4/20/2009                                              32
NHI, France:
  Individual & Employer Mandate;
            13.1% of Employees‟ Salary Goes to NIH Fund
  Income Tax Fund Coverage for:
            Retirees, Unemployed, Disabled, Poor.
  87% Have Supplemental Insurance:
            Private, for-profit Insurers
            Purchased by Employer or Individuals.


4/20/2009                                             33
France:
 Population: 61.7 Million
 Life expectancy at Birth: 80.3
 Health Spending as % GDP: 11.1%
 Coverage: Universal
 Health Spending per capita/yr.: $3,300
 $2,644 (80%) From Government,
 $440 (13%) From Individuals for Private Insurance,
    $220 Consumer Out-of-Pocket Expenses
4/20/2009                                       34
France: Notable Features
 30 Chronic Conditions:
   Including Diabetes: Fully Covered
 Broad Choice of Physicians, Specialists
 Case Management:
        Pre/Post Natal Care, Cancer, Other Conditions
 Prescription Coverage:
        Co-pay Based on Demonstrated Effectiveness


4/20/2009                                            35
France:
 Physicians Organized into Unions
   Government pays Fee-For-Service
   Based on Negotiated Rates
 Hospitals:
   Government Sets Rates
 Challenges:
   Increasing Costs, Inefficiencies.

4/20/2009                              36
Canadian System:
 NHI – of sorts.
 Funded by Taxes From The General Fund
 Single Payer System
            Budgets on a Provincial Level
 Most Hospitals: Self Managed, Private
            “Funding without Organization”
 Physicians: Salaried & Fee For Service
            Care is Publically Funded, Privately Delivered

4/20/2009                                                    37
Canada:
 Population: 33 Million
 Life expectancy at Birth: 81.1 yrs.
 Health Spending as % GDP: 10.3%
 Health Spending per capita/yr.: $3460
        $2, 422 (70%) From Government
   $1100 (30%) Private Spending
 Challenges:
        Increasing Costs; Waiting Times
4/20/2009                                 38
III. Mixed Funding, Mixed Coverage
 U.S.A.
 Funding From:
        Private Insurance, Individuals & Government
        • Multiple Payers
        • No Individual or Employer Mandate
        • Coverage Not Universal

4/20/2009                                             39
United States:
 Population: 302 Million
 Life Expectancy at Birth: 78.1
 Health Spending as % of GDP: 15.3%
 46 Million, or 16% Uninsured
        Medical Debt Is The #1 Cause of Bankruptcy
 Spending/capita/yr. = $7,000
 $3220 (46%) From Government
 $3780 (54%) Employer-Employees, Individuals
4/20/2009                                            40
United States:
 Highest Infant Mortality: in OECD
 Coverage: Almost all people over 65 yrs. Old.
        Approx. 80% of people under 65 yrs.old.
 Total Health Spending/yr. = $3.16 Trillion
 Physician & Hospital Fees:
        Predetermined in Government Programs &
           Private Insurance
        No Price Controls for Uninsured:
            Charged approximately 200%
4/20/2009                                         41
United States (cont.)
 Notable Features:
        Individual Choice; Very Expensive
        Advanced Technology, Drugs and Facilities
        Insured Patients Choose Doctors & Hospitals
 Challenges:
        1. The Uninsured
        2. Discrepancy between Rich and Poor
            Access & Quality of Care
        3. Increasing Costs, Quality Concerns
        4. Dysfunctional Payment System
4/20/2009                                             42
Common U.S. Values and Opinions:
The „Rugged Individual‟ Spirit
  Anti-Entitlement
  Anti-Government-Run Programs
“U.S. Has the Best Healthcare the World”
“Universal Coverage => Runaway Costs”
“We‟re Different”


4/20/2009                                      43
Cost of Care Per Capita
            7000
                      United States
                      Germany
                      Canada
            6000      France
                      Australia
                      United Kingdom
            5000



            4000



            3000



            2000



            1000



               0
                80

                82

                84

                86

                88

                90

                92

                94

                96

                98

                00

                02

                04
             19

             19

             19

             19

             19

             19

             19

             19

             19

             19

             20

             20

             20
4/20/2009                                    44
Cost of Healthcare - % of GDP
            16


            14


            12


            10


            8


            6
                              United States
                              Germany
            4
                              Canada
                              France
                              Australia
            2
                              United Kingdom

            0
               80
               82
               84
               86
               88
               90
               92
               94
               96
               98
               00
               02
               04
4/20/2009                                      45
            19
            19
            19
            19
            19
            19
            19
            19
            19
            19
            20
            20
            20
Health Spending/person %GDP
    $7,000                      18.0%

                                16.0%
    $6,000

                                14.0%
    $5,000
                                12.0%

    $4,000                      10.0%

                                8.0%
    $3,000                              Ave. Annual
                                        Spending/person
                                6.0%
    $2,000
                                        Hlth. Spending
                                4.0%    %GDP
    $1,000
                                2.0%

            $0                  0.0%




4/20/2009                                                 46
Life Expectancy &
                         Ave. Annual Spending/Person
$7,000                                                       83.0

                                                      82.1
$6,000                                                       82.0
                                               81.3

$5,000                                                       81.0
                          80.3

$4,000                                                       80.0
                                        79.4                        Life Expectancy
                  79.0           79.0
$3,000                                                       79.0

           78.1
                                                                    Ave. Annual
$2,000                                                       78.0
                                                                    Spending/person


$1,000                                                       77.0



   $0                                                        76.0




    4/20/2009                                                                         47
US Health Spending Projections
                          National Health Expenditures (billions)
$4,500


$4,000


$3,500


$3,000


$2,500


$2,000


$1,500


$1,000
             2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
 4/20/2009                                                                                     48
Consistent Differences
 Non U.S. Healthcare Systems:
   Are Significantly Less Expensive
   Have Acceptable (Better?) Outcomes
   All Have:
   1. Individual &/or Employer Mandates
   2. Universal Coverage


4/20/2009                                 49
What's Happening Here?
 I. Is There a Crisis?
    Characteristics of U.S. Healthcare System
    Are a Result Of:
            History, Structure, & Culture
 II. No System Is Perfect
     All Have Challenges, Problems
 III. Is it Less Expensive:
     To Mandate Participation?
     To Provide Universal Coverage?

4/20/2009                                       50
Reform Efforts:
 I. What Are Our Goals?
     Reduce Cost?
     Improve Quality?
     Cover the Uninsured?
 II. Can, or Should We Try
     To Accomplish All of Them Concurrently?
     How?

4/20/2009                                  51
What Are Our Options?
 I. Answers
 II. Questions




4/20/2009                           52
Comparative Health Systems

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Comparative Health Systems

  • 1. Surgery Grand Rounds Robert Wolfson, MD, MSHA Healthcare Systems: History, Management & Policy April 20, 2009
  • 2. Comparative Analysis Of National Healthcare Systems www.wolfsonconsulting.com/grandrounds April 20, 2009
  • 3. Healthcare Crisis! quot;Report puts U.S. health care with industrialized world's worst.quot; (Family Practice News, 2008) quot;The Coming Healthcare Collapsequot; Obama Health Plan Unafforable: Income tax to rise by 90%! (Robert McIntosh: 4/14/2009, A.P.) quot;The Healthcare Crisis in Americaquot; (Families USA – 2007) 4/20/2009 3
  • 4. Healthcare Crisis! quot;Lack of health insurance causes 18,000 unnecessary deaths every year.quot; (Institute of Medicine, January 14, 2004) quot;To Err is Humanquot; (IOM, 1999, 2003) quot;44,000 – 98,000 People Die Each Year In Hospitals as a Result of Medical Errorsquot; 16%, or 43 Million Americans Have No Medical Insurance (CDC) 4/20/2009 4
  • 6. What’s Going On Here? Is This Problem Unique to the U.S.? How Do Healthcare Systems Function In Other Comparable Nations? Where Should We Turn For Examples With Our Healthcare Reform Efforts? This Morning: Compare U.S. Healthcare System With Healthcare Systems In Other Nations 4/20/2009 6
  • 7. Topics 1. Define Terms & Methods 2. Evolution - Health Systems OECD Nations 3. Health System Models & Examples 4. Consistent Differences 5. Current Healthcare Debate 6. Discussion 4/20/2009 7
  • 8. Terms I. OECD II. Healthcare III. Analytic Methods: quot;Systems Theoryquot; IV. Healthcare System V. Individual Madate, Employer Mandate VI. Single Payer System 4/20/2009 8
  • 9. I. OECD: Organization for Economic Cooperation and Development 30 Countries Committed to 'Democracy & the Market Economy' Began in 1921, Expanded in 1960's In the 20th Century, All OECD Countries Extended Government‟s Role in Financing & Organization of Health Services 4/20/2009 9
  • 10. OECD - 30 Countries 20 Nations Initially: (1921) Austria, Belgium, Canada, Denmark, France, Germany, Greece, Iceland, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, Turkey, U.K., U.S.A. + 10 Later: Australia, Czech Republic, Finland, Hungary, Japan, Korea, Mexico, New Zealand, Poland, & Slav. Repuplic 4/20/2009 10
  • 11. II. Healthcare All Goods & Services Delivered Designed to Promote Health Including: • Preventive, Curative & Palliative Interventions • Directed to Individuals & Populations 4/20/2009 11
  • 12. III. Methods Healthcare Systems Can be Compared Using Different Disciplines, or Methods: 1. Sociology: Distribution of Care per Sociologic Group 2. Economics: Most Data Available 3. Systems Theory: The Most Comprehensive 4/20/2009 12
  • 13. Systems Theory: quot;The Study of the Nature of Systems In Nature, Society and Sciencequot; A Framework by which One Can Analyze A Group of Objects, Working in Concert To Produce a Result Examples of Systems: Cell, A Method, quot;Cardiovascular Systemquot; 4/20/2009 13
  • 14. Characteristics of Systems: 1. Separate Objects Acting as an Integrated Whole Often Reach Functional Equilibrium: (Closed Systems) 2. Objects in Systems are often Grouped into Categories: Input, Processing, Output, Feedback 3. Parts of Systems Have: Functional & Structural Relationships to Each Other 4/20/2009 Slide 14
  • 15. IV. Healthcare System = All Resources Dedicated to Providing Healthcare Services to Populations, Nations Include: Patients, Providers, Methods, Treatments Institutions, Organizations, Buildings Acting as an Integrated Whole to Provide Healthcare Services to Populations &/or Nations 4/20/2009 15
  • 16. Healthcare Systems Inputs: Funding, Patients, Physicans Throughputs: Healthcare Organizations, Treatments Outputs: Outcomes, Payments to Providers Environment: Physical Environment, Health Of Individuals & Community Feeback: Patient Health, Satisfaction, Health of Community 4/20/2009 16
  • 17. Healthcare System Model Feedback Input: Output: Throughput: $$$, Patients, Suppli $$$, Patients In Pt. & Out Pt. es, Clinical Outcomes, Services, Information Information Information Environment People, Wellness, Illness, Risks 17 4/20/2009
  • 18. Terms (cont.) V. Individual, Employer Mandates: Individual citizens are required to have health insurance, one way or another. Employers are required to provide health insurance to employees. VI. Single Payer System Payment for all Healthcare Expenses comes from a Single Source or Fund. 4/20/2009 18
  • 19. Evolution of Health Systems In U.S., Before & During World War II: Labor Shortage, Freeze on Prices and Wages Employers Allowed to Offer Health Insurance As a Tax Deductable Benefit to Employees = Subsidy to Employers & Employees 4/20/2009 19
  • 20. Following World War II: Western European Nations & Japan: Had to Rebuild From Scratch Developed National Health Systems Through Socialist Governments United States Chose Not to Build A National Health System, But Provided Subsidies to Their Healthcare System 4/20/2009 20
  • 21. U.S. Subsidies Hospitals: Hill Burton Act – Funding For Hospitals Many Hospitals Granted Tax Exempt Status Training of Health Professionals Subsidized Through Governmental Grants Employer-Sponsored Health Insurance: Remained Tax Decuctible 1960's: Medicare, Medicaid 4/20/2009 21
  • 22. Health System Models I. National Health Service (NHS) II. National Health Insurance (NHI) III. Mixed Funding, Mixed Coverage Pvt. Insurance + Government Funding Coverage is Not Universal 4/20/2009 22
  • 23. I. National Health Service (NHS) quot;Nationalization of Healthcarequot;: Including Providers, Facilities & Services Universal Coverage, Single Payer Financing From: Income Tax, General Taxes & General Fund District Budgets Are Used to Control Spending 4/20/2009 23
  • 24. Characteristics: NHS Patients seen in Public Hospitals & Clinics Physicians work for NHS Countries Include: Great Britain, Sweden, Norway, Finland, Spain, Italy, Greece Private Practices often Allowed 4/20/2009 24
  • 25. United Kingdom: Population: 61 Million Life expectancy at birth: 79 Health spending as % GDP: 8.3% Coverage: Universal Management: Government Hospitals: Owned by Government Physicians: Paid Salary by Government Receive Fees from Private Insurance, Patients 4/20/2009 25
  • 26. U.K.: Spending Health Spending per capita per yr.: $2,580 $ 2,245 (87%) From Government $335 (13%) From Individuals For Supplemental, Private Insurance, Payments to Doctors, Self Pay for OTC drugs Prescription drugs: 1/2 Population Receive Drugs for Free, Exemptions: Age, Disability and Pregnancy 4/20/2009 26
  • 27. U.K. (cont.) Notable features: 1. Patients do not receive Bills: Or Insurance Premiums 2. National Inst. Health & Clinical Excellence: Advice For Treatments & Drugs to be Covered 3. Challenges: Inefficiencies, Old Infrastructure, Waiting Times, Unequal Distribution of Resources Among Districts. Professor Sir Bruce Keogh, 2/2/09 4/20/2009 27
  • 28. II. National Health Insurance (NHI) = Nationalization of Health Insurance May be Single or Multiple Payers, But There is Universal Coverage with Employer &/or Individual Mandates Financing Comes From: Employment Taxes; Social Security Less „Budgeted‟ More Flexible form of Financing Private & Public Hospitals/Clinics Exist 4/20/2009 28
  • 29. NHI: Japan, France Individuals Buy Coverage: From Government Plan or Private Insurers Universal Coverage, Individual Mandate Consumers Pay Insurance Premiums Government Provides Subsidies for: • Elderly • Those in Need • Small Businesses 4/20/2009 29
  • 30. Japan: NHI; Financing: Public & Private Insurance Universal Coverage; Individual & Employer Mandate Funding: From Employment Taxes and Private Insurance Premiums ~ 4% of Salary => Nonprofit, Community-Based Insurance Plan. Public Assistance For Small Businesses, Elderly & Poor 4/20/2009 30
  • 31. Japan: Population: 128 million Life Expectancy at Birth: 82.1 Health Spending as % GDP: 8% Coverage: Universal Spending/capita/yr.: $2474 $ 2053 (83%) From Government, $420 (17%) From Invividuals: Gov't. Controls on Pharmaceutical Prices 4/20/2009 31
  • 32. Japan (cont.) Notable features: Frequent Doctor Visits; Long Hospital Stays. Insurers Must Cover Everyone; Can't Deny a Claim. Biggest challenges: Rapidly Aging Population. Overuse of Care. Highest Number of Hospitals/Person in the world. Shortage of Physicians in Many Specialties & Rural Areas. 4/20/2009 32
  • 33. NHI, France: Individual & Employer Mandate; 13.1% of Employees‟ Salary Goes to NIH Fund Income Tax Fund Coverage for: Retirees, Unemployed, Disabled, Poor. 87% Have Supplemental Insurance: Private, for-profit Insurers Purchased by Employer or Individuals. 4/20/2009 33
  • 34. France: Population: 61.7 Million Life expectancy at Birth: 80.3 Health Spending as % GDP: 11.1% Coverage: Universal Health Spending per capita/yr.: $3,300 $2,644 (80%) From Government, $440 (13%) From Individuals for Private Insurance, $220 Consumer Out-of-Pocket Expenses 4/20/2009 34
  • 35. France: Notable Features 30 Chronic Conditions: Including Diabetes: Fully Covered Broad Choice of Physicians, Specialists Case Management: Pre/Post Natal Care, Cancer, Other Conditions Prescription Coverage: Co-pay Based on Demonstrated Effectiveness 4/20/2009 35
  • 36. France: Physicians Organized into Unions Government pays Fee-For-Service Based on Negotiated Rates Hospitals: Government Sets Rates Challenges: Increasing Costs, Inefficiencies. 4/20/2009 36
  • 37. Canadian System: NHI – of sorts. Funded by Taxes From The General Fund Single Payer System Budgets on a Provincial Level Most Hospitals: Self Managed, Private “Funding without Organization” Physicians: Salaried & Fee For Service Care is Publically Funded, Privately Delivered 4/20/2009 37
  • 38. Canada: Population: 33 Million Life expectancy at Birth: 81.1 yrs. Health Spending as % GDP: 10.3% Health Spending per capita/yr.: $3460 $2, 422 (70%) From Government $1100 (30%) Private Spending Challenges: Increasing Costs; Waiting Times 4/20/2009 38
  • 39. III. Mixed Funding, Mixed Coverage U.S.A. Funding From: Private Insurance, Individuals & Government • Multiple Payers • No Individual or Employer Mandate • Coverage Not Universal 4/20/2009 39
  • 40. United States: Population: 302 Million Life Expectancy at Birth: 78.1 Health Spending as % of GDP: 15.3% 46 Million, or 16% Uninsured Medical Debt Is The #1 Cause of Bankruptcy Spending/capita/yr. = $7,000 $3220 (46%) From Government $3780 (54%) Employer-Employees, Individuals 4/20/2009 40
  • 41. United States: Highest Infant Mortality: in OECD Coverage: Almost all people over 65 yrs. Old. Approx. 80% of people under 65 yrs.old. Total Health Spending/yr. = $3.16 Trillion Physician & Hospital Fees: Predetermined in Government Programs & Private Insurance No Price Controls for Uninsured: Charged approximately 200% 4/20/2009 41
  • 42. United States (cont.) Notable Features: Individual Choice; Very Expensive Advanced Technology, Drugs and Facilities Insured Patients Choose Doctors & Hospitals Challenges: 1. The Uninsured 2. Discrepancy between Rich and Poor Access & Quality of Care 3. Increasing Costs, Quality Concerns 4. Dysfunctional Payment System 4/20/2009 42
  • 43. Common U.S. Values and Opinions: The „Rugged Individual‟ Spirit Anti-Entitlement Anti-Government-Run Programs “U.S. Has the Best Healthcare the World” “Universal Coverage => Runaway Costs” “We‟re Different” 4/20/2009 43
  • 44. Cost of Care Per Capita 7000 United States Germany Canada 6000 France Australia United Kingdom 5000 4000 3000 2000 1000 0 80 82 84 86 88 90 92 94 96 98 00 02 04 19 19 19 19 19 19 19 19 19 19 20 20 20 4/20/2009 44
  • 45. Cost of Healthcare - % of GDP 16 14 12 10 8 6 United States Germany 4 Canada France Australia 2 United Kingdom 0 80 82 84 86 88 90 92 94 96 98 00 02 04 4/20/2009 45 19 19 19 19 19 19 19 19 19 19 20 20 20
  • 46. Health Spending/person %GDP $7,000 18.0% 16.0% $6,000 14.0% $5,000 12.0% $4,000 10.0% 8.0% $3,000 Ave. Annual Spending/person 6.0% $2,000 Hlth. Spending 4.0% %GDP $1,000 2.0% $0 0.0% 4/20/2009 46
  • 47. Life Expectancy & Ave. Annual Spending/Person $7,000 83.0 82.1 $6,000 82.0 81.3 $5,000 81.0 80.3 $4,000 80.0 79.4 Life Expectancy 79.0 79.0 $3,000 79.0 78.1 Ave. Annual $2,000 78.0 Spending/person $1,000 77.0 $0 76.0 4/20/2009 47
  • 48. US Health Spending Projections National Health Expenditures (billions) $4,500 $4,000 $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 4/20/2009 48
  • 49. Consistent Differences Non U.S. Healthcare Systems: Are Significantly Less Expensive Have Acceptable (Better?) Outcomes All Have: 1. Individual &/or Employer Mandates 2. Universal Coverage 4/20/2009 49
  • 50. What's Happening Here? I. Is There a Crisis? Characteristics of U.S. Healthcare System Are a Result Of: History, Structure, & Culture II. No System Is Perfect All Have Challenges, Problems III. Is it Less Expensive: To Mandate Participation? To Provide Universal Coverage? 4/20/2009 50
  • 51. Reform Efforts: I. What Are Our Goals? Reduce Cost? Improve Quality? Cover the Uninsured? II. Can, or Should We Try To Accomplish All of Them Concurrently? How? 4/20/2009 51
  • 52. What Are Our Options? I. Answers II. Questions 4/20/2009 52