Feature | December 17, 2013

United States Ranks Near Bottom Among Industrialized Nations in Healthcare Spending Efficiency

UCLA, McGill study also shows women fare worse than men in most countries

December 17, 2013 — A new study by researchers at the University of California, Los Angeles (UCLA) Fielding School of Public Health and McGill University in Montréal reveals that the United States healthcare system ranks 22nd out of 27 high-income nations when analyzed for its efficiency of turning dollars spent into extending lives.
The study, which appears in the "First Look" section of the American Journal of Public Health, illuminates stark differences in countries' efficiency of spending on healthcare, and the United States' inferior ranking reflects a high price paid and a low return on investment.
For example, every additional $100 spent on healthcare by the United States translated into a gain of less than half a month of life expectancy. In Germany, every additional $100 spent translated into more than four months of increased life expectancy. The researchers also discovered significant gender disparities within countries.
"Out of the 27 high-income nations we studied, the United States ranks 25th when it comes to reducing women's deaths," said Jody Heymann, M.D., Ph.D., dean, UCLA Fielding School of Public Health, and senior author of the study. "The country's efficiency of investments in reducing men's deaths is only slightly better, ranking 18th."
The study, which utilized data from 27 member countries of the Organization for Economic Cooperation and Development collected over 17 years (1991–2007), is the first known research to estimate health-spending efficiency by gender across industrialized nations.
"While there are large differences in the efficiency of health spending across countries, men have experienced greater life expectancy gains than women per health dollar spent within nearly every country," said Douglas Barthold, the study's first author and doctoral candidate, department of economics, McGill University.
The report's findings bring to light several questions. How is it possible for the United States to have one of the most advanced economies yet one of the most inefficient healthcare systems? And while the United States healthcare system is performing so poorly for men, why is it performing even worse for women?
The exact causes of the gender gap are unknown, the researchers said, thus highlighting the need for additional research on the topic, but the nation's lack of investment in prevention for both men and women warrants attention.
"The most effective way to stop people from dying prematurely is to prevent them from getting sick in the first place," said Heymann.
Last year, the United States spent only a fraction of its $2.65 trillion annual healthcare budget on prevention. Healthcare spending is a large and ever-increasing portion of government budgets, particularly in the United States. Therefore, allocating the necessary resources for prevention and improving overall efficiency are both critically important to preventing premature deaths and wiser spending, the researchers stressed.
Additional authors included assistant professor Arijit Nandi and researcher José Mauricio Mendoza Rodríguez of McGill University.
For more information: www.apha.com

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