A Closer Look at Global Heathcare Rankings
A Look Inside the Data
In the year 2000, the World Health Organization (WHO) produced a comprehensive ranking of the health care services by nation. When the report was released it shocked many in terms of where the US was ranked relative to the rest of the world. The ranking was 37 out of about 190 nations. Yet a closer look at this ranking seemed to have a great focus on a view of a political morality, rather than actual results. So let’s take a closer look.
One of the first things to note is that there is actually more than one report produced by the WHO. One such report measures “Overall Attainment” while the other report focuses on “Overall Performance” of the healthcare system. Yet when measuring performance, the US ranks 37th and under the attainment ranking the US is ranked 15th among all nations. In theory the performance ranking should be the least politically biased since it should be driven by results. Yet the measurements used to achieve these rankings were as follows:
While it would seem that the first and third categories would be suitable to include in a performance ranking of actual results, the other three should be less likely to be measured. For example, financial performance represents the level of household contribution to their health care expenditures as a percentage of household income beyond basic subsistence. Poor people spend a larger percentage of their annual income on healthcare than the wealthy do. Yet as healthcare is recognized as a necessity, it would make sense that as your net worth grew over time, you would spend a smaller percentage of your income on this expense. Using the same measurement, you would likely find that the wealthy spend a smaller percentage of their income on toilet paper. The increase in ones income over time tends to mean more spending on discretionary items and not basic essentials for daily living. The WHO is making a purely subjective values based measurement. While one may have opinions on this topic, it has no bearing on the actual performance results of treatment.
Another highly subjective measurement was that the WHO report penalized the US for having things like Heath Savings Accounts (HSA’s). In addition, the report penalized the US for not having a more progressive tax system in the category of “fairness”. When in fact, the reality is there is actually no historical correlation between a more progressive income tax and actual revenues received by the treasury. See Below Link…
The life expectancy ranking was one of the more distorted rankings within the WHO study. Life expectancy in general is a terrible way to measure a health system for various reasons. The first problem with this measurement is it assumes that all mortalities are the result of someone coming into contact with the health system. In fact that is quite far from the truth. Life expectancy can be affected by various exogenous factors such as victims of violent crimes, auto accidents, airplane crashes, train crashes, obesity, drug abuse and tobacco usage. Many of these reflect personal choices that individuals make, as well as unfortunate accidents. The size, wealth and commercial activity of a nation can greatly affect these statistics. Obesity for example is a serious problem in the US, yet it is hardly a problem in more impoverished nations. In fact when you correct for homicides and fatal accidents, the US has the highest life expectancy rate in the world.
Another way in which life expectancy data is simply manipulated is the category of infant mortality. In the US a low birth to weight baby has a much greater chance of surviving with the latest of medical technology available. Yet some of those premature infants still don’t make it to term. Yet in many of the nations that the WHO ranked higher than the US, those premature infants were excluded from the life expectancy data. In other cases some nations simply have a higher abortion rate. This is often used to address birth defects in many places around the world. Cuba has extremely low infant mortality rates. However they have one of the world’s highest rates of abortion. The OECD ranked the U.S. 18th out of 30 nations in a similar study of life expectancy. Yet similarly, in an extraodinary example of political bias, the infant mortality measure was not used by a universal standard. For just a few examples…
The U.S. includes “all deaths after live birth and defines births as live if newborns show any sign of life, regardless of prematurity”.
However, Australia and Germany include only deaths of infants who weigh at least one pound at birth.
In both Belgium and France, the deaths of infants born after less than 26 weeks of pregnancy are just simpley excluded from the study.
As Michael Tanner, a Senior Fellow and policy analyst with the CATO institute noted on this topic...The main problem is inconsistent measurement across nations. The United Nations Statistics Division, which collects data on infant mortality, stipulates that an infant, once it is removed from its mother and then "breathes or shows any other evidence of life such as beating of the heart, pulsation of the umbilical cord, or definite movement of voluntary muscles... is considered live-born regardless of gestational age." While the U.S. follows that definition, many other nations do not. For example in Switzerland "an infant must be at least 30 centimeters long at birth to be counted as living." This simply excludes many of the most vulnerable infants from Switzerland's infant mortality measure.
Another common critique of the US health system is that we spend far more on care as percentage of GDP or when measured on a per capita basis than any other nation. Much of this increased spending is actually the result of how the Gov’t actively distorts prices in the marketplace. For more information on this, as well as other areas of price distortion read the below link…
Yet is all this excess spending on healthcare entirely bad ??? To a very large extent the reason the US spends more is we as American’s have chosen to. We are the wealthiest nation on the planet and have opted to do this. Americans all across the country take their child to the pediatrician after nearly every little sniffle. I myself have done this with my own children. The result is that we engage in a luxury that many other nations simply don’t have.
Other factors that affect the cost of care is the fact that the US is largely a heterogenous society in terms of race and ethincity. Many forms of illness are statistically isloated to individuals of a certain race or ethnic backround. So as a nation the US needs to spend more on the research of various forms of disease that affect different groups in different numbers. By comparison, testicular cancer for example is largely non-existent in Japan. Whether it is a genetic difference or somehow related to the Japanese diest in somewhat unknown. Since they deal with a very limited number of cases of this disease in Japan, they spend far less on research. This is the case with many forms of illness across ethnic lines. Whereas in the US, as a result of greater cultural diversity we need to be more versatile.
What about accessibility ??? Often we hear that there are more than 45 million uninsured Americans across the U.S. This figure comes from the 2000 US census. Yet even this claim is quite problematic.
Within this data we can see that nearly 10 million, 9.7 of the 45.7 million uninsured are “not a citizen.” That makes every media claim of uninsured Americans higher than 35.9 million innacurate. More than 17 million of the uninsured make at least $50,000 per year (the median household income was $50,233). 8.4 million had incomes between $50,000 to $74,999 per year and 9.1 million make $75,000 or higher. Two economists working at the National Bureau of Economic Research concluded that 25 to 75 percent of those who do not purchase health insurance coverage “could afford to do so.” An Urban Institute study found that 25 percent of the uninsured already qualify for government health insurance programs and simply failed to enroll in them. Furthermore, within this data were those who were simply switching jobs at the time. In fact the Congressional Budget Office said at the time of this study that 45 percent of the uninsured will be insured within four months. The CBO Director at the time this census was released Douglas Holtz-Eakin said the following about the frequent claim of 40+ million Americans lacking insurance, “This claim is an incomplete and potentially misleading picture of the uninsured population.”
The reality is this picture was greatly distorted. Since this study, a new census has been done and the data around the unemployed would have likely worsened in such difficult economic times. However, the statistics are greatly exaggerated for political gain. Nearly 25% of those included were simply not Americans. Many feel we have a responsibility to insure anyone who shows up on our shores in the US, regardless of citizenship or legal status. However, many do not feel that way. At least be informed about the real data.
As it currently stands, it is simply illegal to refuse emergency treatment to anyone in the US. Although, entering the emergency room is not the first preference nor is it the most cost effective one.
OUTCOMES & RESULTS
What are the actual outcomes ??? In reality the best possible measurement of a health care system should be in my view its ability to achieve success for those who actually come into contact with the system and engage in treatment. When examining the survival rate for the treatment of Cancer, Heart Disease, AID’s, pneumonia and virtually every major illness…The US ranks first.
When the WHO study was completed, it should also be noted that even that study ranked the US #1 in the following specific areas...
Responsiveness to Patient Needs
Choices of Providers
In my view these areas are infintely more important than the political opinion expressed in the study in relation to the US tax code or other political views on fairness.
In this category the US ranks number one in new technology. The vast majority of Nobel Prize winners in the field of medicine are either US citizens or foreigners who have come to the US to work and engage in our technological advancement. This is more likely a result of our economic system and some of the freedoms we enjoy. The US leads the world in innovation to such a great extent that organizations like the Mayo Cinic, Cleveland Clinic, Johns Hopkins and M.D. Anderson see literally thousands of foreign visitors each year flying to the US for the necessary expertise. Many travel great distances from around the world to do so.
In summary I would suggest to you that the US does not have a problem with technology, innovation, or accessibility to the extent that is often portrayed. Rather we have nothing more than a cost issue. The rate of inflation on healthcare is far greater than that of baseline inflation. There is only one way to bring down cost and still maintain quality of service or perhaps even improve it. The only solution is to do away with many of the underlying price distortions that Gov’t intervention has created. Since the creation of many of these programs, the cost of healthcare has risen far faster. More Gov’t intervention, while possibly well intended, has begun to create shortages of medical professionals and increased cost… not decreased it. This is an economic problem, not a medical problem. It must be dealt with through proper economic incentives rather than trying recreate many of the past mistakes of other nations as well as our own.
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