The health care “free market”

November 26, 2010 | By | 4 Replies More

Many American conservatives argue that we need to step back and allow the “free market” continue to offer the most efficient health care system in the world. The facts on the ground starkly conflict with this way of thinking.

The International Federation of Health Plans recently released its 2010 Comparative Price Report detailing medical costs per unit. The study starkly illustrates that health care costs are much higher in some countries than others. The average U.S. prices for procedures are the highest of those in the 12 countries surveyed for nearly all of the 14 common services and procedures.

For example, total hospital and physician costs for delivering a baby are $2,147 in Germany, $2,667 in Canada, and an average of $8,435 in the United States. The survey shows that the cost for a hospital stay is $1,679 in Spain, $7,707 in Canada, but these costs can range from an average of $14,427 to $45,902 in the United States. The survey also found that the cost of a widely prescribed drug like Nexium can range from $30 in the United Kingdom to $186, the average cost in the United States.

In addition to providing comparative cost data across the countries, the survey provides information about the wide range of costs being charged in the United States for common services, procedures and drugs. One example from the survey is hip replacement surgery which cost $12,737 in the Netherlands, but ranged from a low of $21,247 to a high of $75,369 in the United States. Five percent of U.S. prices are higher than $75,369.
The differential between unit prices was greatest for surgery, according to the survey data. One of the highest differentials was for cataract surgery hospital and physician costs. The range for cataract surgery ran from $1,667 in Spain to an average of $14,764 in the United States.

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Category: Health, Health Care Reform, Medicine

About the Author ()

Erich Vieth is an attorney focusing on consumer law litigation and appellate practice. He is also a working musician and a writer, having founded Dangerous Intersection in 2006. Erich lives in the Shaw Neighborhood of St. Louis, Missouri, where he lives half-time with his two extraordinary daughters.

Comments (4)

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  1. grumpypilgrim says:

    Is there *any* data to support the notion that the U.S. healthcare system is the most "efficient" healthcare system in the world? Isn't there overwhelming evidence that it is not, whether one considers metrics on mortality, longevity, mental health, chronic disease, total cost, administrative cost, cost-per-patient, or many other measures? Seems to me the U.S. consistenly pays more for its healthcare than any other country on the planet, yet rarely claims the #1 spot in health-related metrics.

  2. Grumpy,

    Probably anecdotally, mostly. I do know that a good friend of mine who is from England was bounced around the British system for years, even into the arms of homeopaths, without a proper diagnosis. After less than six months living here, she had her diagnosis—M.S.—and a treatment regimen.

    It depends what you mean by "efficient." If by that you mean the best care for the most people, it's likely no system can do that, so we end up talking about optimal care—sufficient for the most people.

    However, we've had an argument raging for decades over so-called well-care—preventative—which, if properly funded and insured, would reduce a great deal of catastrophic care and, one would think, reduce costs. we're just now getting to that, which has been a fixture in several European countries for a long time.

    But if you have the money and a weird illness, the American system is the one to be sick in.

    Efficient is the wrong term to use in these debates, though.

  3. Niklaus Pfirsig says:

    Mark,

    In any health care system from any country you can find stories like your Brit friend.

    For example, I personally knew someone a few years ago, that began experiencing severe back pain. He was in his late 50s at the time, and had very good insurance.

    His GP couldn't find a cause for the pain and sent him to orthopedic specials, who took several Xrays, and found nothing. He was referred to a neurologist who also found nothing. He was referred to a psychiatrist on the assumption that the pain was psycho-somatic. The pain was not Psycho-somatic.

    He was bounced around between specialist for about 2 years, before one of the specialists had a CAT scan performed on him. The scan showed a tumor on his spine that had not been visible in normal XRays. Unfortunately, by the time it was found, the tumor had metastasized, and nothing could be done.

    Basically shit happens.These cases are not made up, but the question is: Are they representative of the care system or are they the exceptions.

  4. Rick Massey says:

    Thank you for this post. Unlike those who preach about the U.S. having the “best healthcare in the world”, this shows what is really going on. I think most of us realize what elephant in the room is responsible for this situation. Our country suffers from a unique combination of graft and greed on the part of the politicians, insurance and pharmaceutical industries; and arrogance fortified by apathy on the part of us, the citizens.

    This "we have the best healthcare in the world" jargon never comes with any substantial evidence because there isn’t any. That’s why all snake oil salesmen get away with using the “best” label. It’s purely subjective. But it plays on what Americans want to believe anyway. So it sells. Our legislators (from both major parties) have been for sale to the highest bidder for years – even before the Supreme Court made it official this year with Citizens United v. FEC. We actually passed laws preventing the government from negotiating with pharmaceutical companies. And we have pandered to the insurance industry for years. How can people see on the one hand insurance companies reporting record profits year after year while other businesses suffer; and the huge discrepancy between what we pay and what people in other countries pay for healthcare and still not get it?

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