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Healthcare Doesn’t Have to Cost an Arm and a Leg: 29 Reasons for Optimism from Comparisons between Countries and U.S. States

Months of bare-knuckled wrangling over health care reform have given rise to a widespread view that there’s nothing on which Democrats and Republicans can agree. But there is one: politicians on both sides of the aisle agree that health care is far too expensive. And they’re right. Total public and private health spending in 2009 was almost $2.5 trillion. In the next hour, the nation will spend $280 million on our health.

But policy makers and everyday Americans alike have reason to be optimistic that dramatically lower costs are possible. Why? Because residents of twenty-nine countries live longer lives, on average, than Americans do – while spending as much as eight times less on their health. That’s twenty-nine reasons for optimism that the U.S. can reign in health care costs while also getting better results.

U.S. life expectancy at birth – 78.3 – is on par with that of Chile, a country that spends a tenth of what the U.S spends. When it comes to the survival of the youngest Americans, the picture is worse: the U.S. ranks 39th in the world for infant survival. A baby born today in Slovakia, Poland, Hungary, Croatia, or Cuba has a better chance of living to celebrate his or her first birthday than does a baby born in the U.S. Combined pubic and private health care spending in the U.S. amounts to over $7,000 per person each year. For less than half the price, citizens of Australia, Israel, Italy, and Spain outlive us. And they are not alone.

Some have argued that comparing the U.S. – with its large, diverse population and a federalized system that assigns significant responsibility for health care to the states – to smaller European countries is like comparing an apple to oranges. To allow for a more nuanced analysis, the American Human Development Project has calculated life expectancy at birth as well as infant death rates for each of the 50 states plus Washington D.C., enabling comparisons among U.S. states and between U.S. states and other countries. So how do we stack up? Do the states do a better – or worse – job than other countries and the U.S. as a whole at turning health dollars into years of human life?

KEY FINDINGS

Life expectancy by state ranges from 81.1 years in Hawaii to 74.3 years in Mississippi, a span of eight years. Spending ranges from $4,124 per person annually in Utah to more than double that sum – $8,614 – in Washington, D.C. Tables in the appendix rank U.S. states and 80 countries by life expectancy at birth (Table 1), infant death rate (Table 2), and health expenditures per per-son (Table 3).

Life expectancy:

  • • Life expectancy in Hawaii (81.1 years) approaches that of top-ranked Japan (82.3 years), but Japan spends half what Hawaii does.
  • • Delaware and Cuba have the same life expectancy (78 years), but Cuba spends nine times less per person.
  • • Life expectancy in Alabama (74.8 years) and Louisiana (74.7 years) is comparable to that of Ecuador, yet spending in Ecuador is about 13 times less.
  • • Albanians live longer than residents of eight U.S. states (Alabama, Arkansas, Kentucky, Louisiana, Mississippi, Oklahoma, Texas, and West Virginia) and Washington, D.C., but Albania spends between 12 and 21 times less than each.

Infant deaths:

  • • Thirty nations, including less affluent countries like Portugal, Slovenia, and Malta, have a lower infant death rate than Washington State, which has the lowest rate of infant death among U.S. states. Estonia, whose rate of 4.8 infant deaths per 1,000 live births is comparable to Washington’s, spends about a fifth of what Washington spends on health.
  • • The nation’s capital, which has the highest infant mortality rate in the nation (12.1 infant deaths per 1,000 live births) does only marginally better than Belarus (12.4), de-spite spending 13 times more on health care.

This research makes plain that Americans are paying top dollar for mediocre results. But it also shows that, in the U.S. case, there is no relationship between higher health spending and better health outcomes. Among very poor countries, small changes in health care expenditures are associated with large changes in life expectancy, since roughly a third of deaths are among children who die for want of low-cost interventions like immunizations and safe water. This is not the case among high-income countries like the U.S., where the leading causes of death are chronic conditions like heart disease and cancer. Here, good health depends upon a host of interrelated factors, from access to care, to the physical and social environments in which we live, to the decisions we make in our daily lives.

MANY FACTORS INFLUENCE LIFE EXPECTANCY

Two states, Minnesota and Mississippi, showcase the many components that fuel life expectancy gaps.

    • Minnesota has the second-highest life expectancy in the U.S (80.6 years), a lifespan comparable to that found in France, Sweden, and Spain. Evidence suggests that many factors con-tribute to the longevity of Minnesotans. For instance, 91.5% of Minnesotans have health insurance, a higher percentage than in any other state but Massachusetts. Minnesotans also smoke less and exercise more than the national average. And while the state’s health spending overall is below the national average, spending on public health, such as childhood immunization, food safety, and cancer screening clinics, is well above the national average.
    • Mississippi has the nation’s lowest life expectancy (73.4 years), a lifespan less than that of Mexico, which spends six times less on health. Nearly one in five Mississippians lack health insurance of some kind, a higher percentage than all but seven other states. Mississippi is second only to West Virginia in diabetes diagnoses, and the prevalence of adult obesity, at a full third of all adults, is 25 percent higher than the national average. Mississippians are also less likely to exercise regularly than the residents of any other state except for their neighbors in Louisiana. Finally, Mississippi has the highest rate of adults over the age of 25 who did not complete high school. Education is one of the strongest drivers of good health: better-educated people tend to practice healthier behaviors, are more informed consumers of medical services, and are more likely to adhere to treatment regimes. And parents with more education tend to be more effective in supporting healthy outcomes for their children.

CONCLUSION

Every health care system in the world has its flaws; there is no perfect way to balance the many trade-offs such that everyone wins all the time. Some systems require long waits for elective procedures; others do not cover experimental therapies; still others place limits on certain services. Some have explicit rationing systems based on medical need, unlike the U.S., which has a tacit rationing system based on ability to pay.

But quality care doesn’t have to cost an arm and a leg. What at least twenty-nine of these flawed, imperfect systems have managed to do is to provide affordable, high-quality health care to most of the population at a fraction of the U.S. cost and with better results. We must take the first steps without requiring that they be a perfect or final arrangement.

For sources, methodological notes, and data tables, please see the full report, available at www.measureofamerica.org/healthcare.


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