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Private insurance and public healthcare
Shanadeus
Registered User regular
Registered User regular
A friend of mine told me that the NHS in the UK is a whole lot worse than the whole deal they have over in the US, which I had a hard time accepting.
I tried to find some sites or comparative studies taking comparing the situation between different countries but couldn't come up with anything good so instead I tried to do it myself.
Let's take the UK for an example, with the NHS:
The yearly budget of the NHS is approximately £100 billion which divided by the population of the UK (roughly 62 million) gives us a per person cost of £1,612.
That is, $2,655 when directly converted into US dollar or enough to buy 1,612 McDonald cheeseburgers in the UK (as directly converting a currency is misleading I'll go with the McDonald comparison index. For comparison, you need to pay $1,612 to buy 1,612 McDonald cheeseburgers).
If we divide the budget by the number of income-tax payers (roughly 30 million) then we get £3,333 (3,333 McDonald cheeseburgers) a year per person.
Putting aside all my silly calculations, it does seem like an awful lot and quite possibly a lot more than what a decent private insurance in the US cost. But to make a fair comparison you'd have to look at a number of other factors, some more directly related (in addition to the monthly payments, you might have to pay still for the procedures in the US while some procedures aren't covered at all) and others less so (the private insurance might be more expensive but other things in life are cheaper in comparison with the UK).
Anyway, what do you think?
Where would you rather live if all non-healthcare things were equal?
I tried to find some sites or comparative studies taking comparing the situation between different countries but couldn't come up with anything good so instead I tried to do it myself.
Let's take the UK for an example, with the NHS:
The yearly budget of the NHS is approximately £100 billion which divided by the population of the UK (roughly 62 million) gives us a per person cost of £1,612.
That is, $2,655 when directly converted into US dollar or enough to buy 1,612 McDonald cheeseburgers in the UK (as directly converting a currency is misleading I'll go with the McDonald comparison index. For comparison, you need to pay $1,612 to buy 1,612 McDonald cheeseburgers).
If we divide the budget by the number of income-tax payers (roughly 30 million) then we get £3,333 (3,333 McDonald cheeseburgers) a year per person.
Putting aside all my silly calculations, it does seem like an awful lot and quite possibly a lot more than what a decent private insurance in the US cost. But to make a fair comparison you'd have to look at a number of other factors, some more directly related (in addition to the monthly payments, you might have to pay still for the procedures in the US while some procedures aren't covered at all) and others less so (the private insurance might be more expensive but other things in life are cheaper in comparison with the UK).
Anyway, what do you think?
Where would you rather live if all non-healthcare things were equal?
Shanadeus on
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The US, on the other hand, spends far more on health care per person than any other industrialized nation. However, much like the UK, health care outcomes here are not as good as they are in Canada and continental Europe.
TL;DR: Americans don't get their money's worth on health care; the British get what they pay for, but they're buying the health care equivalent of Happy Meals.
In terms of health care spending as a % of GDP, the US ranks #2 worldwide (apparently we're outspent by the Marshall Islands...), while the UK is #41, just ahead of Uruguay and Zimbabwe.
Relevant chart, I think
Americans' bodies have adapted to detect and destroy any substance providing through socialists means.
Considering I spend $4,000 US a year on very crappy health insurance, that still leaves me paying $20 per doctor visit, $60-70 in prescriptions per month and that's not even counting what it'd cost me if I actually had a serious medical problem, I don't think it's that much at all (I'm seriously fucked if anything bad happens).
I mean if you can find me a decent US health insurance policy for what you pay per person for NHS, I'm all for it, but the current US system basically screws over everyone but the richest and since the taxpayer ends up subsidizing a lot of business expenses (particularly the 'socialist' representatives who receive free health care for life at taxpayer expense) I'd welcome a public healthcare system.
I mean, hell, just making insurance companies work like co-ops would be a huge step in the right direction, as costs would be lowered and/or benefits increased.
BlueCross is a "non-profit" and one of the largest providers of health insurance in the country and that doesn't really help. In Minnesota, health insurance has to be non-profit. It helps a little, but not to a significant portion that it would be a solution to the current problems that the system has.
Are you joking?
I'm a healthy, male 20something, average weight/height, no smoking, little drinking, and I work out often. My last checkup I was classified as healthy as an ox. It would cost me $150 a month, to get any decent healthcare (and that's with a $1000 deductable). That's $1800 a year, and I'm the healthiest and least costly demographic for health insurance possible.
The lowest possible cost for my ~60 year old step dad is $1000 a month, or $12000 a year. He's not particularly healthy, but he's also not unhealthy for his age. And that's for shit tier service that would bankrupt him anyways if he needed major treatment.
Seriously, $3000 a month is incredibly cheap for comprehensive care.
I think he meant EVERYTHING. Not just the insurance, because that's not the only place with a twisted profit motive. You'd need to get the clinics and hospitals, and the drug manufacturers as well.
Really, the idea behind single payer is that A) you have one HUGE collective bargaining chip. And
Wait, why? The US numbers seemed to include Medicare spending, so it would be birth -> death comparisons for both, unless I'm missing something.
_Nothing_.
I'm pretty certain that between the portion of premiums that I pay, the portion that my employer pays, and the portion that I have to pay every time I go to the doctor or get any sort of medication, it's significantly more than that for me alone, a 29 year old male non-smoker who runs three to four miles a day (most days, anyway, heh).
Besides that, I know that my insurance will do anything it can to get out of paying a dime for anything. To put this in perspective, around 62% of bankruptcies in the US are medically-related. Nearly 80% of the people declaring bankruptcy when medical costs are involved HAD INSURANCE. The average out of pocket cost for a person with insurance who is declaring bankruptcy? $17,749.
http://articles.cnn.com/2009-06-05/health/bankruptcy.medical.bills_1_medical-bills-bankruptcies-health-insurance?_s=PM:HEALTH
It's even worse than that when you take into account charts like this one showing productivity per capita:
The US has higher GDP per capita than nearly every country on that list, which means that the costs per capita are even worse than the first graph would suggest.
Yeah, that. I mean, with the drug companies and stuff, I would expect a lot of the profit to just be turned into research funding or something, which I don't really mind. But if all insurance companies, hospitals, and places like Urgent Cares (not sure how I feel about private practices specifically) were non-profit, things might get a bit cheaper.
Shan's McDonald's math appears to compare the (Total number of UK healthcare "dollars" spent) / (Population of the UK) and use that as the basis of comparison to a US private health insurance premium.
One critique (of many) of this analysis is that you are including the most expensive age band in the UK, but are eliminating it entirely in the US. People over 65 and people that have renal failure do not have private insurance in the US.
People were cheering last year over Obama's healthcare plan and how everyone would be able to get health insurance now, no matter what. Those of us who require good health insurance in the u.s. to be able to function, laughed at how stupid this was. The insurance people would have gotten would have been exactly the same as having no insurance at all, except this time you would be paying for it. The first thing you learn is that health insurance does not guarantee health care. Even when you are paying a lot of money for it, you will still run into the problems i've described.
The cost of healthcare is a serious issue but it's only one of many. There is a lot of very scummy, unethical business practices going on in the healthcare industry in America too with regards to the way insurance and doctors treat their patents that a lot of people aren't being made aware of. Most of it dealing with billing people and charging patients as much as possible and for things that they know that patient doesn't actually need to pay. This one time a hospital tried to get me to pay for a bill that I know I didn't have too pay and threatened to take it to a collection agency. They hounded me for months, calling constantly and then sold it off to a CA after I told them to get fucked. I ended up getting bugged by that CA a few months ago, this was over 2 years after the fact too. Completely ridiculous shit.
Worth pointing out that there has been a lot of fairly dramatic reform of the NHS over the last term of Parliament, and many of the stats are showing significant improvements. The cancer stats (which show that survivablility rates are among the lowest in Europe) that the Tories like to rely on as a justification for their attempted privatisation of the NHS are from 2008. The stats from 2010 show a negligible difference between the UK and the best performing countries, and the trends indicate that the gap will likely close within 18 months or so.
There are a ton of badly put together stats about NHS performance floating around at the moment because the current government is determined to gut it, and the companies that would make money from its privatisation have all been publishing their own analyses through right wing think tanks.
EDIT: It's also going to be interesting to see what happens over this term of Parliament, given that health is a devolved policy area. England and Wales will get whatever system the Tories manage to get passed. At the moment they're declaring that whatever they try to pass must involve private provision and competition, and that the NHS budget must be controlled by GP consortia rather than Primary Care Trusts. The SNP Government in Scotland is never going to introduce any reform that even vaguely resembles that. So it'll be interesting to compare and contrast in four/five years time.
Also, as alluded to by a few posters, for any ill that you have in a comprehensive system like the NHS, of which there are some, you do get a pretty hefty dose of peace of mind. I suffer from a couple of chronic diseases which require regular medical visits and the prospect of occasional surgery or hospital visits and while I could afford private insurance now, there have been many times when bad luck could have destroyed me financially, medically. In the UK or NZ, that is very unlikely to happen to me even if I lose my job or ability to work
You're joking, right? Pharma companies spend almost 2x as much on marketing as they do on research; of course it helps that a lot of the original research is tax-payer funded (but still patented!). Plus it takes a lot of money to convince doctors to prescribe over-priced medications that provide little or no (and sometime worse) benefits compared to cheaper alternatives.
Right, but the goal of those activities is to increase sales, with the end goal of increasing profits. If they're not allowed to make profit, I would think there would be a noticeable shift in internal budgeting, with research being among the larger benefactors (probably right after salary increases).
The WHO World Health Report 2000 (annex table 1) notes that, in a cross country study:
The UK came 14th and the US 24th in a measure of health status (disability adjusted life expectancy), the distribution of health in the UK was far more equal than in the US (in fact, it came second compared to the US' 32nd), in terms of 'fairness' the US came 54-55, the UK came in 8 - 11.
In terms of overall performance of the system (cost-efficiency) in terms of the level of health, the US came 72nd. The UK came 24th. In terms of cost-efficiency of of the system alone (not taking into account the health level), the US fared better - it came 37th although the UK also improved to 18th.
The Commonwealth Fund's 'mirror mirror' provides a much more limited analysis (only amongst seven developed countries), but finds a similar abysmal performance of the US.
The UK is not getting a 'happy meal'; the NHS is ultimately more effective and efficient a tool at ensuring a good level of health and an equitable distribution of that health than the US system is, which is clear to see. Why? Because the US health care system is a mess. There are substantial problems of information asymmetry that lead to huge market failures which haven't been dealt with in the US in any form of systematic manner; the reforms go a long way to helping, but they effectively mimic a Social Health Insurance system (it should be further noted that France, with a SHI system, comes top place in the WHO study for performance). The UK's system does have problems, yes, but they are relatively minor compared to the fundamental flaws in the US system.
The theory and empirical data are clear on this: you can not have an efficient private insurance system without a fairly substantial amount of Government intervention in some respect (note that I do not call for public /provision/ of health care - the problems lie predominately on the insurance side).
Note: I did my undergraduate dissertation on the US health care system (from an economic standpoint - not necessarily numbers/accounts side, but on the fundamental economic characteristics), so feel free to ask away - it's an interesting, confusing and often surprising topic.
They could spend massively more on their research right now. The top pharma companies regularly put away at least double what they spend on R&D in net profit:
here are the top 5 in terms of market share:
Company, R&D, Profts:
Pfizer: $7bn $19bn
Novartis: $7bn $11bn
Merck & Co.: $4bn $4bn
Bayer: $1.7bn $6bn
GlaxoSmithKline: $6bn $10bn
I really doubt that stopping the profits is going to send that money into R&D, as the companies are already gauging the public to the bone and new drugs will not represent new income flows, they'll just shift the windfall elsewhere.
Then they'll be forced to do something else with that money. Something other than stuff it in their fat pockets.
hhhm. maybe lobbying to keep the status quo? Or for 'regulatory capture'?
You're abolishing the motive of having drug companies at all. Pharma companies won't research any new drugs* without the ability to make profit. There won't be lucrative salaries to lure the best and brightest minds to research*. They won't have ability to educate the masses about the benefits of their drugs. etc.
You might as well abolish drug patents and importation laws while you do it. If they're going to be non-profit, there's no reason that any company can't make any drug if there's no profits to worry about. And once everyone's making every drug anyways, there's no reason not to allow importation from other countries as long as their stuff is certified as identical. Hurray, everyone has access to practically free medicines!
But wait! Abolishing drug patents and importation laws would fix do that anyways. If you're going to abolish drug patents, you don't need to remove their ability to make a profit. So why not go for that point directly?
*Yeah, I know they don't research them now either. Whatever.
The drug companies, though, wouldn't be forced to pay people less or anything like that. They're still sales-based organizations, and they still need to raise capital through sales in order to function, and pay their people. This would simply force them to reinvest any profits made, which would result in either cheaper services, higher paid employees, or larger budgets. None of those things are inherently bad for a drug company (at least until you start talking about executive pay).
If you're going to kill the 'motive to research' anyways, you might as well get everyone in America cheap drugs while you do it.
There are ways of encouraging research besides giving monopoly power in the form of patents. Government prizes, for example. Say that a drug that does XYZ is worth $100 million or whatever, somebody invents the drug, they get the cash and everyone gets to produce the drug and sell it at marginal cost, and the patients get the drug cheap. It also allows us to direct research better. We can say that a certain drug is more socially valuable than another drug, and offer a higher prize for the better, so that we have drug developers working on drugs that solve life-threatening problems rather than restless legs syndrome. Patents are a very inefficient and imprecise way of rewarding drug developers.
I'd love to hear those ways, but I don't think regulation on the industry is the way to do it. Up until very recently, only 20% of drug marketing money was spent on direct-to-consumer advertisement and we still had the same fucked up problems. Doctors are also human, and they naturally like the beautiful girls who come into their workplace with free food every week, who just want to talk about how their company's drug can help their patients. It's not even an incentive thing. They just hear the work Zoloft every week and subconsciously start prescribing it to patients. Plus, regulatory capture.
The problem is that we've got a company with perfect control over supply and a population that demands a product or they literally die. It doesn't matter what they're selling: drugs, food, water, protection. There's only two solutions to the problem I know of, either turn them into a public utility or break up their control over supply.