When it Comes to Health Care Costs, America is No. 1

As a nation, America has plenty about which to be proud. In fact, the United States can claim No. 1 status on numerous fronts – from having the world’s largest Gross Domestic Product – to earning the most Olympic medals.


The USA also ranks No. 1 in money spent for health care. This particular top-notch status, however, isn’t necessarily a good thing. As an employer, you know that health care costs can take up a large part of your budget. Here are some interesting facts:


No U.S. Health Care Bargains

A report released earlier this year by the International Federation of Health Plans compared health care costs in the United States with those of 10 other nations (Argentina, Australia, Chile, France, Netherlands, New Zealand, Spain, South Africa, Spain, and United Kingdom). Across the board, America occupied the top-price slot.


Consider bringing a baby into the world. The price tag for a normal delivery in America ranges from an average of $9,775 to a high of $16,653 – which is double what it costs in Australia (which ranked second highest) – and 14 times more than what you’d pay in Argentina.


A similar price pattern emerged for coronary artery bypass surgery. The average U.S. price tops the list at $73,420 and can climb to $150,515 – which is $30,000 more than second-place Australia – and more than eight times higher than Argentina.


Even at the most basic level – a routine visit to the doctor – the average cost in America is $95 and escalates to $176 or more. In second place is Chile, were the price tag is a mere $38. If hospitalization is required, the average daily cost in the United States is $4,287 – a total that towers above the 10 other countries – and is almost 10 times more than Argentina.


Higher Prices but not necessarily Better Care

If the timeworn adage – you get what you pay for – held true in relation to America’s health care costs, our nation’s significantly higher prices could be deemed justified. According to a recent study by The Commonwealth Fund, however, this doesn’t appear to be the case.


Specifically, the study found that – although the United States spends more on health care than 12 other industrialized countries – it does not provide “notably superior” care. Specifically, U.S. health care spending amounted to more than 17% of gross domestic product, compared to an average of 9.5% in the other countries studied.


The report further revealed that the United States has among the highest rates of potentially preventable deaths from asthma and amputations due to diabetes, as well as rates that are no better than average for in-hospital deaths from heart attack and stroke.


Access also is an issue in America. According to the Organization for Economic Co-operation and Development (OECD) – an international economic group comprised of 34 member nations – the United States has 2.4 practicing physicians per 1,000 people, which is well below the OECD average of 3.1. Additionally, the number of hospital beds in America is 2.6 per 1,000 population, compared to the OECD average of 3.4.


Possible Explanations

So, why are U.S. health care costs the highest worldwide?


Some point to the fact that American physicians earn higher incomes than doctors in other countries, and that there’s greater utilization of expensive diagnostic procedures in the United States.


It’s also argued that because there are so many different insurance carriers in this country, there are no unifying incentives to reduce waste and ensure that all Americans – when it comes to health care – truly are getting what they pay for.


Health Net is here to make sure you get the right plans for your employees, and the most for your money. Please contact your Health Net representative if you have questions about your company’s plan.











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Stacy Madden