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Health care in the United States

See also: Health care reform in the United States, Patient or Scotland.[11][12] A study showed that the U.S., Japan,
Protection and Aordable Care Act and Health Care and France recorded the highest survival rates among 31
and Education Reconciliation Act of 2010
nations for four types of cancer.[13]
America is a global leader in medical innovation. The US
solely developed or contributed signicantly to 9 of the
top 10 most important medical innovations since 1975
as ranked by a 2001 poll of physicians, while the EU
and Switzerland together contributed to ve. Since 1966,
Americans have received more Nobel Prizes in Medicine
than the rest of the world combined. From 1989 to 2002,
four times more money was invested in private biotechnology companies in America than in Europe.[14][15] The
United States also has the most advanced hospitals in the
[16]
6065% of healthcare provision and spending comes world.
from programs such as Medicare, Medicaid, the Gallup recorded that the uninsured rate among U.S.
Childrens Health Insurance Program, and the Veterans adults was 11.9% for the rst quarter of 2015, continuing
Health Administration. Most of the population under 67 the decline of the uninsured rate outset by the Aordis insured by their or a family members employer, some able Care Act.[17] A 2004 Institute of Medicine (IOM)
buy health insurance on their own, and the remainder are report said: The United States is among the few indusuninsured. Health insurance for public sector employees trialized nations in the world that does not guarantee acis primarily provided by the government.
cess to health care for its population. A 2004 OECD reThe United States life expectancy of 78.4 years at birth, port said: With the exception of Mexico, Turkey, and
up from 75.2 years in 1990, ranks it 50th among 221 na- the United States, all OECD countries had achieved unitions, and 27th out of the 34 industrialized OECD coun- versal or near-universal (at least 98.4% insured) coverage
tries, down from 20th in 1990.[3][4] Of 17 high-income of their populations by 1990. Recent evidence demoncountries studied by the National Institutes of Health in strates that lack of health insurance causes some 45,000
unnecessary deaths every year in the United
2013, the United States had the highest or near-highest to 48,000
[18][19]
States.
In 2007, 62.1% of lers for bankruptcies
prevalence of obesity, car accidents, infant mortality,
claimed
high
medical
expenses. A 2013 study found that
heart and lung disease, sexually transmitted infections,
about
25%
of
all
senior
citizens declare bankruptcy due
adolescent pregnancies, injuries, and homicides. On avto
medical
expenses,
and
43% are forced to mortgage or
erage, a U.S. male can be expected to live almost four
[20]
sell
their
primary
residence.
fewer years than those in the top-ranked country, though
Health care in the United States is provided by many
distinct organizations.[1] Health care facilities are largely
owned and operated by private sector businesses. 58%
of US community hospitals are non-prot, 21% are government owned, and 21% are for-prot.[2] According to
the World Health Organization (WHO), the United States
spent more on health care per capita ($8,608), and more
on health care as percentage of its GDP (17.2%), than
any other nation in 2011.

notably Americans aged 75 live longer than those who On March 23, 2010, the Patient Protection and Aordreach that age in other developed nations.[5]
able Care Act (PPACA) became law, providing for major
in health insurance. The medical system will be
changes
A comprehensive 2007 study by European doctors found
forced
to
change normal procedures.[1] They will be rethe ve-year cancer survival rate was signicantly higher
quired to prepare for upcoming programs to meet federal
in the U.S. than in all 21 European nations studied, 66.3%
[21]
for men versus the European mean of 47.3% and 62.9% regulations. The constitutionality of the law, as well as
its impact on insurance coverage, insurance quality, inversus 52.8% for women.[6][7] Americans undergo canquality, and the economy are
cer screenings at signicantly higher rates than people surance premiums, medical[22]
subjects of ongoing debate.
in other developed countries, and access MRI and CT
scans at the highest rate of any OECD nation.[8] People in
the U.S. diagnosed with high cholesterol or hypertension
access pharmaceutical treatments at higher rates than
those diagnosed in other developed nations, and are 1 History
more likely to successfully control the conditions.[9][10]
Diabetics are more likely to receive treatment and meet
treatment targets in the U.S. than in Canada, England, Main article: History of medicine in the United States

2 STATISTICS
dierent. 53% of women who die before 50 die due
to disease, whereas 38% die due to accidents, homicide,
and suicide.[24] However maternal deaths related to childbirth have increased. In 2013 18.5 mothers died for every 100,000 births. In 1987 the mortality rate was 7.2 per
100,000. The American rate is now more than double the
maternal mortality rate in Saudi Arabia and Canada, and
more than triple the rate in the United Kingdom.[25]
A study by the Agency for Healthcare Research and Quality (AHRQ) found that there were 38.6 million hospital
stays in the U.S. in 2011, an 11 percent increase since
1997. Since the population also grew during this period,
the hospitalization rate remained stable at approximately
1,200 stays per 10,000 population.[26]

The Polio vaccine was discovered by Jonas Salk and distributed


to the world

Statistics

The U.S. Census Bureau reported that 49.9 million residents, 16.3% of the population, were uninsured in 2010
(up from 49.0 million residents, 16.1% of the population,
in 2009).[27][28] According to the World Health Organization (WHO), the United States spent more on health
care per capita ($7,146), and more on health care as percentage of its GDP (15.2%), than any other nation in
2008.[29] The United States had the fourth highest level of
government health care spending per capita ($3,426), behind three countries with higher levels of GDP per capita:
Monaco, Luxembourg, and Norway.[29] A 2001 study in
ve states found that medical debt contributed to 46.2%
of all personal bankruptcies and in 2007, 62.1% of lers for bankruptcies claimed high medical expenses.[30]
Since then, health costs and the numbers of uninsured
and underinsured have increased.[31] A 2013 study found
that about 25% of all senior citizens declare bankruptcy
due to medical expenses.[20]

Health care facilities are largely owned and operated by


private sector businesses. Health insurance for public
sector employees is primarily provided by the government. 6065% of healthcare provision and spending comes from programs such as Medicare, Medicaid,
TRICARE, the Childrens Health Insurance Program,
and the Veterans Health Administration. Most of the
population under 65 is insured by their, or a family members employer. Some buy health insurance on their own,
Active debate about health care reform in the United
and the remainder are uninsured.
States concerns questions of a right to health care, acOf 17 high-income countries studied by the National Incess, fairness, eciency, cost, choice, value, and quality.
stitutes of Health in 2013, the United States was at or near
Some have argued that the system does not deliver equivthe top in infant mortality, heart and lung disease, sexalent value for the money spent. The U.S. pays twice as
ually transmitted infections, adolescent pregnancies, inmuch as Canada yet lags behind other wealthy nations
juries, homicides, and rates of disability. Together, such
in such measures as infant mortality and life expectancy.
issues place the U.S. at the bottom of the list for life exCurrently, the U.S. has a higher infant mortality rate than
pectancy. On average, a U.S. male can be expected to
most of the worlds industrialized nations.[nb 1][32] In the
live almost four fewer years than those in the top-ranked
United States life expectancy is 42nd in the world, after
country.[5]
some other industrialized nations, lagging the other naA study by the National Institutes of Health reported that tions of the G5 (Japan, France, Germany, U.K., U.S.)
the lifetime per capita expenditure at birth, using year and just after Chile (35th) and Cuba (37th).[33]
2000 dollars, showed a large dierence between health
Life expectancy at birth in the U.S., 78.49, is 50th in the
care costs of females ($361,192) and males ($268,679).
world, below most developed nations and some developA large portion of this cost dierence is in the shorter
ing nations. Monaco is rst with 89.68. Chad is last with
lifespan of men, but even after adjustment for age (as48.69. With 72.4% Americans of European ancestry,[34]
sume men live as long as women), there still is a 20%
life expectancy is below the average life expectancy for
dierence in lifetime health care expenditures.[23]
the European Union.[35][36] The World Health OrganizaThere is evidence, however, that a large proportion of tion (WHO), in 2000, ranked the U.S. health care syshealth outcomes and early mortality can be attributed to tem as the highest in cost, rst in responsiveness, 37th in
other factors. As a study by the National Research Coun- overall performance, and 72nd by overall level of health
cil concluded, more than half the men who die before 50 (among 191 member nations included in the study).[37][38]
die due to murder (19%), trac accidents (18%), and In 2008 the Commonwealth Fund, an advocacy group
other accidents (16%). For women the percentages are

3.2

Physicians (M.D. and D.O.)

seeking greater government involvement in US healthcare, then led by former Carter administration ocial
Karen Davis,[39] ranked the United States last in the quality of health care among similar countries,[40] and notes
U.S. care costs the most.[41]

3
pitals as well as government hospitals in some locations,
mainly owned by county and city governments. The HillBurton Act was passed in 1946, which provided federal funding for hospitals in exchange for treating poor
patients.[49]

United States ranks close to the bottom compared to other


industrialized countries on several important health issues
aecting mortality: low birth weight and infant mortality,
injuries and murder, teen pregnancy and STDs, HIV and
AIDS, deaths resulting from drug overdoses, obesity and
diabetes, heart disease, COPD, and general disability.[42]

There is no nationwide system of government-owned


medical facilities open to the general public but there are
local government-owned medical facilities open to the
general public. The U.S. Department of Defense operates eld hospitals as well as permanent hospitals via the
Military Health System to provide military-funded care
A 2004 Institute of Medicine (IOM) report said: The to active military personnel.
United States is among the few industrialized nations in The federal Veterans Health Administration operates VA
the world that does not guarantee access to health care for hospitals open only to veterans, though veterans who seek
its population.[43] A 2004 OECD report said: With the medical care for conditions they did not receive while
exception of Mexico, Turkey, and the United States, all serving in the military are charged for services. The
OECD countries had achieved universal or near-universal Indian Health Service (IHS) operates facilities open only
(at least 98.4% insured) coverage of their populations by to Native Americans from recognized tribes. These facil1990.[44] The 2004 IOM report observed lack of health ities, plus tribal facilities and privately contracted services
insurance causes roughly 18,000 unnecessary deaths ev- funded by IHS to increase system capacity and capabilery year in the United States,[43] while a 2009 Har- ities, provide medical care to tribespeople beyond what
vard study conducted by co-founders of Physicians for can be paid for by any private insurance or other governa National Health Program, a pro-single payer advocacy ment programs.[50]
group, estimated that 44,800 excess deaths occurred anHospitals provide some outpatient care in their emernually due to lack of health insurance.[45] The groups gency rooms and specialty clinics, but primarily exist to
methodology has been criticized by economist John C.
provide inpatient care. Hospital emergency departments
Goodman for not looking at cause of death or tracking and urgent care centers are sources of sporadic probleminsurance status changes over time, including the time of
focused care. Surgicenters are examples of specialty clindeath.[46]
ics. Hospice services for the terminally ill who are exA 2009 study by former Clinton policy adviser Richard
Kronick found no increased mortality from being uninsured after certain risk factors were controlled for, and
specically criticized the methodology used by IOM.[47]

pected to live six months or less are most commonly subsidized by charities and government. Prenatal, family
planning, and dysplasia clinics are government-funded
obstetric and gynecologic specialty clinics respectively,
On March 23, 2010, the Patient Protection and Aord- and are usually staed by nurse practitioners.
able Care Act (PPACA) became law, providing for major
changes in health insurance.

Providers

3.2 Physicians (M.D. and D.O.)

Health care providers in the U.S. encompass individual Main article: Physician in the United States
health care personnel, health care facilities and medical
products.
Physicians in the U.S. include those trained by the U.S.
medical education system, and those that are international
medical graduates who have progressed through the nec3.1 Facilities
essary steps to acquire a medical license to practice in a
state.
Main article: Medical centers in the United States
The American College of Physicians, uses the term physician to describe all medical practitioners holding a proIn the U.S., ownership of the health care system is mainly fessional medical degree. In the U.S., however, most
in private hands, though federal, state, county, and city physicians have either an Doctor of Medicine (M.D.) or
governments also own certain facilities.
a Doctor of Osteopathic Medicine (D.O.) degree. The
The non-prot hospitals share of total hospital ca- American Medical Association as well as the American
pacity has remained relatively stable (about 70%) for Osteopathic Association both currently use the term
decades.[48] There are also privately owned for-prot hos- physician to describe members.

3.3

4 SPENDING

Medical products, research and devel- fastest growing health sectors (such as seniors home care)
are also some of the lowest paid which could cause supply
opment

shortages in the near future.


As in most other countries, the manufacture and production of pharmaceuticals and medical devices is carried out by private companies. The research and de- 4 Spending
velopment of medical devices and pharmaceuticals is
supported by both public and private sources of fund- Main article: Health care spending in the United States
ing. In 2003, research and development expenditures Aggregate U.S. hospital costs were $387.3 billion in
were approximately $95 billion with $40 billion coming
from public sources and $55 billion coming from private
sources.[51][52] These investments into medical research
have made the United States the leader in medical innovation, measured either in terms of revenue or the number
of new drugs and devices introduced.[53][54] In 2006, the
United States accounted for three quarters of the worlds
biotechnology revenues and 82% of world R&D spending in biotechnology.[53][54] According to multiple international pharmaceutical trade groups, the high cost of
patented drugs in the U.S. has encouraged substantial
reinvestment in such research and development.[53][54][55]
Though PPACA, also known as Obamacare or ACA, will
force industry to sell medicine at a cheaper price. Reference behind paywall [56] Due to this, it is possible budget
cuts will be made on research and development of hu- U.S. healthcare costs exceed those of other countries, relative to
man health and medicine in America. Reference behind the size of the economy or GDP.
paywall [56]
2011a 63% increase since 1997 (ination adjusted).
Costs per stay increased 47% since 1997, averaging
3.4 Healthcare provider employment in $10,000 in 2011.[26]

the United States

A large demographic shift in the United States is putting


pressure on the medical system, and the industries that
support it. Roughly 10,000 baby boomers retire every
day in the United States which removes many talented and
experienced workers from the medical eld each year.[57]
The demographic shift to an older population is projected
to increase medical spending in North America by at least
5%,[58] creating a funding crunch that the government
(through medicare and other social services), insurance
companies, and individual savings accounts are straining
to absorb. Finally, the older population is rapidly increasing demand for healthcare services despite the tight budgets and reduced workforce. All of these factors put pressure on wages and working conditions,[59] with the majority of healthcare jobs seeing salary reductions between
2009 and 2011.[60]
The challenging demographic pressures on the United
States medical system means that more reductions (and
imbalances) in wages are coming. Employment opportunities are increasing[61] but job security and employee
condence have both fallen[62] for medical professionals. Highly trained doctors, surgeons, and support sta
such as anesthesiologists are insulated from falling wages
thanks to high barriers of entry. For sta with less training, formerly well paying jobs are being outsourced or cut
to make up budget shortfalls. Additionally, some of the

According to the World Health Organization (WHO), total health care spending in the U.S. was 17.9% of its GDP
in 2011, the highest in the world.[29] The Health and Human Services Department expects that the health share
of GDP will continue its historical upward trend, reaching 19.5% of GDP by 2017.[63][64] Of each dollar spent
on health care in the United States, 31% goes to hospital care, 21% goes to physician/clinical services, 10% to
pharmaceuticals, 4% to dental, 6% to nursing homes and
3% to home health care, 3% for other retail products, 3%
for government public health activities, 7% to administrative costs, 7% to investment, and 6% to other professional
services (physical therapists, optometrists, etc.).[65]
Around 84.7% of Americans have some form of health
insurance; either through their employer or the employer
of their spouse or parent (59.3%), purchased individually
(8.9%), or provided by government programs (27.8%;
there is some overlap in these gures).[66] All government
health care programs have restricted eligibility, and there
is no government health insurance company which covers
all Americans. Americans without health insurance coverage in 2007 totaled 15.3% of the population, or 45.7
million people.[66]
Among those whose employer pays for health insurance,
the employee may be required to contribute part of the
cost of this insurance, while the employer usually chooses
the insurance company and, for large groups, negotiates

5.1

Involved organizations and institutions

with the insurance company. Government programs directly cover 27.8% of the population (83 million),[66] including the elderly, disabled, children, veterans, and some
of the poor, and federal law mandates public access to
emergency services regardless of ability to pay. Public
spending accounts for between 45% and 56.1% of U.S.
health care spending.[67]

volved in health care. The health agencies are a part


of the U.S. Public Health Service, and include the Food
and Drug Administration, which certies the safety of
food, eectiveness of drugs and medical products, the
Centers for Disease Prevention, which prevents disease,
premature death, and disability, the Agency of Health
Care Research and Quality, the Agency Toxic Substances
Some Americans do not qualify for government-provided and Disease Registry, which regulates hazardous spills of
toxic substances, and the National Institutes of Health,
health insurance, are not provided health insurance by an
employer, and are unable to aord, cannot qualify for, or which conducts medical research.
choose not to purchase, private health insurance. When State governments maintain state health departments, and
charity or uncompensated care is not available, they local governments (counties and municipalities) often
sometimes simply go without needed medical treatment. have their own health departments, usually branches of
This problem has become a source of considerable polit- the state health department. Regulations of a state board
ical controversy on a national level.
may have executive and police strength to enforce state
health laws. In some states, all members of state boards
must be health care professionals. Members of state
boards may be assigned by the governor or elected by
5 Regulation and oversight
the state committee. Members of local boards may be
elected by the mayor council. The McCarranFerguson
Further information: American Board of Medical Spe- Act, which cedes regulation to the states, does not itself
cialties, United States Medical Licensing Examination regulate insurance, nor does it mandate that states reguand National Association of Insurance Commissioners
late insurance. Acts of Congress that do not expressly
purport to regulate the business of insurance will not
preempt state laws or regulations that regulate the business of insurance. The Act also provides that federal
5.1 Involved organizations and institutions anti-trust laws will not apply to the business of insurance as long as the state regulates in that area, but federal
Healthcare is subject to extensive regulation at both anti-trust laws will apply in cases of boycott, coercion,
the federal and the state level, much of which arose and intimidation. By contrast, most other federal laws
haphazardly.[68] Under this system, the federal govern- will not apply to insurance whether the states regulate in
ment cedes primary responsibility to the states under that area or not.
the McCarran-Ferguson Act. Essential regulation includes the licensure of health care providers at the state Self-policing of providers by providers is a major part
level and the testing and approval of pharmaceuticals of oversight. Many health care organizations also volunand medical devices by the U.S. Food and Drug Ad- tarily submit to inspection and certication by the Joint
ministration (FDA), and laboratory testing. These reg- Commission on Accreditation of Hospital Organizations,
ulations are designed to protect consumers from ineec- JCAHO. Providers also undergo testing to obtain board
tive or fraudulent healthcare. Additionally, states regu- certication attesting to their skills. A report issued by
late the health insurance market and they often have laws Public Citizen in April 2008 found that, for the third
which require that health insurance companies cover cer- year in a row, the number of serious disciplinary actain procedures,[69] although state mandates generally do tions against physicians by state medical boards declined
to 2007, and called for more oversight of the
not apply to the self-funded health care plans oered by from 2006
[70]
boards.
large employers, which exempt from state laws under preemption clause of the Employee Retirement Income Se- The Centers for Medicare and Medicaid Services (CMS)
curity Act. In 2010, the Patient Protection and Aord- publishes an on-line searchable database of performance
able Care Act (PPACA) was passed by President Barack data on nursing homes.[71] In 2004, conservative think
Obama and includes various new regulations, with one tank Cato Institute published a study which concluded
of the most notable being a health insurance mandate that regulation provides benets in the amount of $170
which requires all citizens to purchase health insurance. billion but costs the public up to $340 billion.[72] The
While not regulation per se, the federal government also study concluded that the majority of the cost dierential
has a major inuence on the healthcare market through arises from medical malpractice, FDA regulations, and
its payments to providers under Medicare and Medicaid, facilities regulations.[72]
which in some cases are used as a reference point in
the negotiations between medical providers and insurance
companies.[68]
At the federal level, U.S. Department of Health and Human Services oversees the various federal agencies in-

5.2

6 OVERALL SYSTEM EFFECTIVENESS

Certicates of need for hospitals

mechanism for such care. Indirect payments and reimbursements through federal and state government programs have never fully compensated public and private
hospitals for the full cost of care mandated by EMTALA.
More than half of all emergency care in the U.S. now goes
uncompensated.[79] According to some analyses, EMTALA is an unfunded mandate that has contributed to
nancial pressures on hospitals in the last 20 years, causing them to consolidate and close facilities, and contributing to emergency room overcrowding. According to the
Institute of Medicine, between 1993 and 2003, emergency room visits in the U.S. grew by 26%, while in the
same period, the number of emergency departments declined by 425.[80]

In 1978, the federal government required that all states


implement Certicate of Need (CON) programs for cardiac care, meaning that hospitals had to apply and receive certicates prior to implementing the program; the
intent was to reduce cost by reducing duplicate investments in facilities.[73] It has been observed that these certicates could be used to increase costs through weakened competition.[68] Many states removed the CON programs after the federal requirement expired in 1986, but
some states still have these programs.[73] Empirical research looking at the costs in areas where these programs
have been discontinued have not found a clear eect on
costs, and the CON programs could decrease costs be- Mentally ill patients present a unique challenge for emercause of reduced facility construction or increase costs gency departments and hospitals. In accordance with
due to reduced competition.[73]
EMTALA, mentally ill patients who enter emergency
rooms are evaluated for emergency medical conditions.
Once mentally ill patients are medically stable, regional
5.3 Licensing of providers
mental health agencies are contacted to evaluate them.
Patients are evaluated as to whether they are a danger to
The American Medical Association (AMA) has lobbied themselves or others. Those meeting this criterion are
the government to highly limit physician education since admitted to a mental health facility to be further evalu1910, currently at 100,000 doctors per year,[74] which has ated by a psychiatrist. Typically, mentally ill patients can
led to a shortage of doctors[75] and physicians wages in be held for up to 72 hours, after which a court order is
the U.S. are double those in the Europe, which is a major required.
reason for the more expensive health care.[76]
An even bigger problem may be that the doctors are paid
5.4
for procedures instead of results.[76]
The AMA has also aggressively lobbied for many restrictions that require doctors to carry out operations that
might be carried out by cheaper workforce. For example,
in 1995, 36 states banned or restricted midwifery even
though it delivers equally safe care to that by doctors, according to studies . The regulation lobbied by the AMA
has decreased the amount and quality of health care, according to the consensus of economist: the restrictions do
not add to quality, they decrease the supply of care.[74][77]
Moreover, psychologists, nurses and pharmacists are not
allowed to prescribe medicines. Previously nurses were
not even allowed to vaccinate the patients without direct
supervision by doctors.

Quality assurance

Health care quality assurance consists of the activities


and programs intended to assure or improve the quality
of care in either a dened medical setting or a program.
The concept includes the assessment or evaluation of the
quality of care; identication of problems or shortcomings in the delivery of care; designing activities to overcome these deciencies; and follow-up monitoring to ensure eectiveness of corrective steps.[81]

One innovation in encouraging quality of health care


is the public reporting of the performance of hospitals,
health professionals or providers, and healthcare organizations. However, there is no consistent evidence that
the public release of performance data changes consumer
36 states require that health care workers undergo
behaviour or improves care.[82]
[78]
criminal background checks.
5.3.1

Emergency Medical Treatment and Active Labor Act (EMTALA)

6 Overall system eectiveness


6.1 Measures of eectiveness

Main article: Emergency Medical Treatment and Active


Labor Act
The US health care delivery system unevenly provides
medical care of varying quality to its population.[83] In
EMTALA, enacted by the federal government in 1986, a highly eective health care system, individuals would
requires that hospital emergency departments treat emer- receive reliable care that meets their needs and is based
gency conditions of all patients regardless of their ability on the best scientic knowledge available. In order to
to pay and is considered a critical element in the safety monitor and evaluate system eectiveness, researchers
net for the uninsured, but established no direct payment and policy makers track system measures and trends

6.2

Compared to other countries

over time. The US Department of Health and Human


Services(HHS) populates a publicly available dashboard
called, the Health System Measurement Project (healthmeasures.aspe.hhs.gov), to ensure a robust monitoring
system. The dashboard captures the access, quality and
cost of care; overall population health; and health system
dynamics (e.g., workforce, innovation, health information technology). Included measures align with other system performance measuring activities including the HHS
Strategic Plan,[84] the Government Performance and Results Act, Healthy People 2020, and the National Strategies for Quality and Prevention.[85][86]
6.1.1

Access to care: Cost, aordability, coverage

The US health system does not provide health care to the


countrys entire population.[87] Individuals acquire health
insurance to oset health care spending. However, lack
of adequate health insurance persists and is a known barrier to accessing the healthcare system and receiving appropriate and timely care.[88][89] Measures of accessibility and aordability tracked by national health surveys
include: having a usual source of medical care, visiting
the dentist yearly, rates of preventable hospitalizations,
reported diculty seeing a specialist, delaying care due
to cost, and rates of health insurance coverage.[90]
As a country, rising health care costs have raised
concerns among the public and private sector alike.
Between 2000 and 2011, health care expenditures nearly doubled, growing from $1.2 trillion to
$2.3 trillion [CDC Health, United States, 2013].
Evidence suggests the rate of growth has slowed
in recent years.[91] Other measures of cost captured by national surveys include: health insurance premiums, high out of pocket costs (e.g., deductibles, copayments), and national health expenditures including individual, employer, and government expenditures.[92]
6.1.2

7
The underutilization of preventative measures, rates
of preventable illness and prevalence of chronic
disease suggest that the US healthcare system
does not suciently promote wellness.[85] Over
the past decade rates of teen pregnancy and low
birth rates have come down signicantly, but not
disappeared.[94] Rates of obesity, heart disease (high
blood pressure, controlled high cholesterol), and diabetes are areas of major concern. While chronic
disease and multiple co-morbidities became increasingly common among a population of elderly Americans who were living longer, the public health system has also found itself fending o a rise of chronically ill younger generation. According to the
US Surgeon General The prevalence of obesity in
the U.S. more than doubled (from 15% to 34%)
among adults and more than tripled (from 5% to
17%) among children and adolescents from 1980 to
2008.[95]
A concern for the health system is that the health
gains do not accrue equally to the entire population.
In the United States, disparities in health care and
health outcomes are widespread.[96] Minorities are
more likely to suer from serious illnesses (e.g., diabetes, heart disease and colon cancer) and less likely
to have access to quality health care, including preventative services.[97] Eorts are underway to close
the gap and to provide a more equitable system of
care.
6.1.3 Innovation: Workforce, healthcare IT, R&D

Finally, the United States tracks investment in the healthcare system in terms of a skilled healthcare workforce,
meaningful use of healthcare IT, and R&D output. This
aspect of the healthcare system performance dashboard
is important to consider when evaluating cost of care in
America. That is because in much of the policy debate around the high cost of US healthcare, proponents
of highly specialized and cutting edge technologies point
to innovation as a marker of an eective health care
Population health: Quality, prevention, vulsystem.[98]
nerable populations

The health of the population is also viewed as a measure 6.2 Compared to other countries
of the overall eectiveness of the healthcare system. The
extent to which the population lives longer healthier lives A 2014 study by the private American foundation The
signals an eective system.
Commonwealth Fund found that although the U.S. health
care system is the most expensive in the world, it ranks
While life expectancy is one measure, HHS uses a last on most dimensions of performance when compared
composite health measure that estimates not only with Australia, Canada, France, Germany, the Netherthe average length of life, but also, the part of life lands, New Zealand, Norway, Sweden, Switzerland and
expectancy that is expected to be in good or better the United Kingdom. The study found that the United
health, as well as free of activity limitations. Be- States failed to achieve better outcomes than other countween 1997 and 2010, the number of expected high tries, and is last or near last in terms of access, equality life years increased from 61.1 to 63.2 years ciency and equity. Study date came from international
surveys of patients and primary care physicians, as well
for newborns.[93]

Life expectancy compared to healthcare spending from 1970 to


2008, in the US and the next 19 most wealthy countries by total
GDP.[99]

as information on health care outcomes from The Commonwealth Fund, the World Health Organization, and
the Organization for Economic Cooperation and Development.[100][101]
The U.S. stands 50th in the world with a life expectancy
of 78.49.[102] The CIA World Factbook ranked the
United States 174th worst (out of 222) meaning 48th
best in the world for infant mortality rate (5.98/1,000
live births).[103]
A study found that between 1997 and 2003, preventable
deaths declined more slowly in the United States than in
18 other industrialized nations.[104] A 2008 study found
that 101,000 people a year die in the U.S. that would not if
the health care system were as eective as that of France,
Japan, or Australia.[105]
The Organisation for Economic Co-operation and Development (OECD) found that the U.S. ranked poorly in
terms of years of potential life lost (YPLL), a statistical measure of years of life lost under the age of 70 that
were amenable to being saved by health care. Among
OECD nations for which data are available, the United
States ranked third last for the health care of women (after Mexico and Hungary) and fth last for men (Slovakia
and Poland also ranked worse).
Further information: Years of potential life lost
Recent studies nd growing gaps in life expectancy based
on income and geography. In 2008, a governmentsponsored study found that life expectancy declined from
1983 to 1999 for women in 180 counties, and for men
in 11 counties, with most of the life expectancy declines
occurring in the Deep South, Appalachia, along the Mississippi River, in the Southern Plains and in Texas. The

6 OVERALL SYSTEM EFFECTIVENESS


dierence is as high as three years for men, six years
for women. The gap is growing between rich and poor
and by educational level, but narrowing between men and
women and by race.[106] Another study found that the
mortality gap between the well-educated and the poorly
educated widened signicantly between 1993 and 2001
for adults ages 25 through 64; the authors speculated that
risk factors such as smoking, obesity and high blood pressure may lie behind these disparities.[107] In 2011 the
U.S. National Research Council forecasted that deaths attributed to smoking, on the decline in the US, will drop
dramatically, improving life expectancy; it also suggested
that one-fth to one-third of the life expectancy dierence can be attributed to obesity which is the worst in the
world and has been increasing.[108] In an analysis of breast
cancer, colorectal cancer, and prostate cancer diagnosed
during 19901994 in 31 countries, the U.S. had the highest ve-year relative survival rate for breast cancer and
prostate cancer, although survival was systematically and
substantially lower in black U.S. men and women.[109]
The debate about U.S. health care concerns questions
of access, eciency, and quality purchased by the high
sums spent. The World Health Organization (WHO) in
2000 ranked the U.S. health care system rst in responsiveness, but 37th in overall performance and 72nd by
overall level of health (among 191 member nations included in the study).[37][38] The WHO study has been
criticized by the free market advocate David Gratzer because fairness in nancial contribution was used as an
assessment factor, marking down countries with high percapita private or fee-paying health treatment.[110] The
WHO study has been criticized, in an article published
in Health Aairs, for its failure to include the satisfaction ratings of the general public.[111] The study found
that there was little correlation between the WHO rankings for health systems and the stated satisfaction of citizens using those systems.[112] Countries such as Italy and
Spain, which were given the highest ratings by WHO
were ranked poorly by their citizens while other countries,
such as Denmark and Finland, were given low scores by
WHO but had the highest percentages of citizens reporting satisfaction with their health care systems.[112] WHO
sta, however, say that the WHO analysis does reect
system responsiveness and argue that this is a superior
measure to consumer satisfaction, which is inuenced by
expectations.[113] Furthermore, the relationship between
patient satisfaction and health care utilization, expenditures, and outcomes is complex and not well dened.[114]
A report released in April 2008 by the Foundation for
Child Development, which studied the period from 1994
through 2006, found mixed results for the health of
children in the U.S. Mortality rates for children ages 1
through 4 dropped by a third, and the percentage of children with elevated blood lead levels dropped by 84%.
The percentage of mothers who smoked during pregnancy also declined. On the other hand, both obesity
and the percentage of low-birth weight babies increased.

7.1

Eciency

The authors note that the increase in babies born with low standardized death rate. The US dropped from 23rd to
birth weights can be attributed to women delaying child- 28th for age-standardized years of life lost. It dropped
bearing and the increased use of fertility drugs.[115][116]
from 20th to 27th in life expectancy at birth. It dropped
[4]
In a sample of 13 developed countries the USA was from 14th to 26th for healthy life expectancy.
third in its population weighted usage of medication in
14 classes in both 2009 and 2013. The drugs studied
were selected on the basis that the conditions treated had
high incidence, prevalence and/or mortality, caused signicant long-term morbidity and incurred high levels of
expenditure and signicant developments in prevention
or treatment had been made in the last 10 years. The
study noted considerable diculties in cross border comparison of medication use.[117]

System eciency and equity

Variations in the eciency of health care delivery can


cause variations in outcomes. The Dartmouth Atlas
Project, for instance, reported that, for over 20 years,
marked variations in how medical resources are distributed and used in the United States were accompanied
by marked variations in outcomes.[118] The willingness of
physicians to work in an area varies with the income of the
area and the amenities it oers, a situation aggravated by
a general shortage of doctors in the United States, particularly those who oer primary care. The Aordable Care
Act, if implemented, will produce an additional demand
for services which the existing stable of primary care doctors will be unable to ll, particularly in economically depressed areas. Training additional physicians would require some years.[119]
Lean manufacturing techniques such as value stream
mapping can help identify and subsequently mitigate
waste associated with costs of healthcare.[120] Other product engineering tools such as FMEA and Fish Bone Diagrams have been used to improve eciencies in healthcare delivery.[121]

7.1
7.1.1

Eciency
Preventable deaths

In 2010, coronary artery disease, lung cancer, stroke,


chronic obstructive pulmonary diseases, and trac accidents caused the most years of life lost in the US. Low
back pain, depression, musculoskeletal disorders, neck
pain, and anxiety caused the most years lost to disability. The most deleterious risk factors were poor diet, tobacco smoking, obesity, high blood pressure, high blood
sugar, physical inactivity, and alcohol use. Alzheimers
disease, drug abuse, kidney disease and cancer, and falls
caused the most additional years of life lost over their ageadjusted 1990 per-capita rates.[4]
Between 1990 and 2010, among the 34 countries in
the OECD, the US dropped from 18th to 27th in age-

According to a 2009 study conducted at Harvard Medical School by co-founders of Physicians for a National
Health Program, a pro-single payer lobbying group, and
published by the American Journal of Public Health, lack
of health coverage is associated with nearly 45,000 excess preventable deaths annually.[18][122] Since then, as
the number of uninsured has risen from about 46 million in 2009 to 48.6 million in 2012, the number of preventable deaths due to lack of insurance has grown to
about 48,000 per year.[19] The groups methodology has
been criticized by economist John C. Goodman for not
looking at cause of death or tracking insurance status
changes over time, including the time of death.[46]
A 2009 study by former Clinton policy adviser Richard
Kronick published in the journal Health Services Research found no increased mortality from being uninsured
after certain risk factors were controlled for.[47]
7.1.2 Value for money
A study of international health care spending levels published in the health policy journal Health Aairs in the
year 2000 found that the United States spends substantially more on health care than any other country in the
Organization for Economic Co-operation and Development (OECD), and that the use of health care services
in the U.S. is below the OECD median by most measures. The authors of the study conclude that the prices
paid for health care services are much higher in the U.S.
than elsewhere.[123] While the 19 next most wealthy countries by GDP all pay less than half what the U.S. does for
health care, they have all gained about six years of life
expectancy more than the U.S. since 1970.[99]
7.1.3 Delays in seeking care and increased use of
emergency care
Uninsured Americans are less likely to have regular health
care and use preventive services. They are more likely
to delay seeking care, resulting in more medical crises,
which are more expensive than ongoing treatment for
such conditions as diabetes and high blood pressure. A
2007 study published in JAMA concluded that uninsured
people were less likely than the insured to receive any
medical care after an accidental injury or the onset of
a new chronic condition. The uninsured with an injury were also twice as likely as those with insurance to
have received none of the recommended follow-up care,
and a similar pattern held for those with a new chronic
condition.[124] Uninsured patients are twice as likely to
visit hospital emergency rooms as those with insurance;
burdening a system meant for true emergencies with less-

10

urgent care needs.[125]


In 2008 researchers with the American Cancer Society
found that individuals who lacked private insurance (including those covered by Medicaid) were more likely to
be diagnosed with late-stage cancer than those who had
such insurance.[126]

7.1.4

Shared costs of the uninsured

Main article: Health insurance coverage in the United


States
The costs of treating the uninsured must often be absorbed by providers as charity care, passed on to the insured via cost shifting and higher health insurance premiums, or paid by taxpayers through higher taxes.[127]
However, hospitals and other providers are reimbursed
for the cost of providing uncompensated care via a federal matching fund program. Each state enacts legislation governing the reimbursement of funds to providers.
In Missouri, for example, providers assessments totaling
$800 million are matched $2 for each assessed $1
to create a pool of approximately $2 billion. By federal
law these funds are transferred to the Missouri Hospital
Association for disbursement to hospitals for the costs incurred providing uncompenstated care including Disproportionate Share Payments (to hospitals with high quantities of uninsured patients), Medicaid shortfalls, Medicaid managed care payments to insurance companies
and other costs incurred by hospitals.[128] In New Hampshire, by statute, reimbursable uncompensated care costs
shall include: charity care costs, any portion of Medicaid patient care costs that are unreimbursed by Medicaid payments, and any portion of bad debt costs that the
commissioner determines would meet the criteria under
42 U.S.C. section 1396r-4(g) governing hospital-specic
limits on disproportionate share hospital payments under
Title XIX of the Social Security Act.[129]
A report published by the Kaiser Family Foundation in
April 2008 found that economic downturns place a signicant strain on state Medicaid and SCHIP programs.
The authors estimated that a 1% increase in the unemployment rate would increase Medicaid and SCHIP enrollment by 1 million, and increase the number uninsured by 1.1 million. State spending on Medicaid and
SCHIP would increase by $1.4 billion (total spending on
these programs would increase by $3.4 billion). This
increased spending would occur at the same time state
government revenues were declining. During the last
downturn, the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA) included federal assistance
to states, which helped states avoid tightening their Medicaid and SCHIP eligibility rules. The authors conclude
that Congress should consider similar relief for the current economic downturn.[130]

SYSTEM EFFICIENCY AND EQUITY

7.1.5 Variations in provider practices


The treatment given to a patient can vary signicantly
depending on which health care providers they use. Research suggests that some cost-eective treatments are not
used as often as they should be, while overutilization occurs with other health care services. Unnecessary treatments increase costs and can cause patients unnecessary
anxiety.[131] The use of prescription drugs varies signicantly by geographic region.[132] The overuse of medical
benets is known as moral hazard individuals who are
insured are then more inclined to consume health care.
The way the Health care system tries to eliminate this
problem is through cost sharing tactics like co-pays and
deductibles. If patients face more of the economic burden they will then only consume health care when it is
necessary. According to the RAND health insurance experiment, individuals with higher Coinsurance rates consumed less health care than those with lower rates. The
experiment concluded that with less consumption of care
there was generally no loss in societal welfare but, for the
poorer and sicker groups of people there were denitely
negative eects. These patients were forced to forgo necessary preventative care measures in order to save money
leading to late diagnosis of easily treated diseases and
more expensive procedures later. With less preventative
care, the patient is hurt nancially with an increase in expensive visits to the ER.The Health Care costs in the U.S
will also rise with these procedures as well. More expensive procedures lead to greater costs.[133][134]
One study has found signicant geographic variations in
Medicare spending for patients in the last two years of
life. These spending levels are associated with the amount
of hospital capacity available in each area. Higher spending did not result in patients living longer.[135][136]

7.1.6 Care coordination


Primary care doctors are often the point of entry for most
patients needing care, but in the fragmented health care
system of the U.S., many patients and their providers experience problems with care coordination. For example,
a Harris Interactive survey of California physicians found
that:
Four of every ten physicians report that their patients
have had problems with coordination of their care in
the last 12 months.
More than 60% of doctors report that their patients
sometimes or often experience long wait times
for diagnostic tests.
Some 20% of doctors report having their patients repeat tests because of an inability to locate the results
during a scheduled visit.[137]

7.2

Third-party payment problem and consumer-driven insurance

According to an article in The New York Times,


the relationship between doctors and patients is
deteriorating.[138] A study from Johns Hopkins University found that roughly one in four patients believe
their doctors have exposed them to unnecessary risks,
and anecdotal evidence such as self-help books and web
postings suggest increasing patient frustration. Possible
factors behind the deteriorating doctor/patient relationship include the current system for training physicians
and dierences in how doctors and patients view the
practice of medicine. Doctors may focus on diagnosis
and treatment, while patients may be more interested in
wellness and being listened to by their doctors.[138]

11

were in provider services and contracting and in general


administration.[147] The McKinsey Global Institute estimated that excess spending on health administration and
insurance accounted for as much as 21% of the estimated total excess spending ($477 billion in 2003).[148]
According to a report published by the CBO in 2008,
administrative costs for private insurance represent approximately 12% of premiums. Variations in administrative costs between private plans are largely attributable to
economies of scale. Coverage for large employers has the
lowest administrative costs. The percentage of premium
attributable to administration increases for smaller rms,
and is highest for individually purchased coverage.[149] A
2009 study published by BCBSA found that the average
administrative expense cost for all commercial health insurance products was represented 9.18% of premiums in
2008.[150] Administrative costs were 11.12% of premiums for small group products and 16.35% in the individual market.[150]

Many primary care physicians no longer see their patients


while they are in the hospital. Instead, hospitalists are
used, which fragments care because hospitalists usually
have had no previous relationship with the patient they
are treating and do not have a personal knowledge of the
patients medical history.[139][140] The use of hospitalists
is sometimes mandated by health insurance companies as One study of the billing and insurance-related (BIR) costs
a cost-saving measure which is resented by some primary borne not only by insurers but also by physicians and
care physicians.[141]
hospitals found that BIR among insurers, physicians, and
hospitals in California represented 2022% of privately
insured spending in California acute care settings.[151]
7.1.7 Administrative costs
The health care system in the U.S. has a vast number
of players. There are hundreds, if not thousands, of insurance companies in the U.S.[142][143] This system has
considerable administrative overhead, far greater than
in nationalized, single-payer systems, such as Canadas.
An oft-cited study by Harvard Medical School and the
Canadian Institute for Health Information determined
that some 31% of U.S. health care dollars, or more than
$1,000 per person per year, went to health care administrative costs, nearly double the administrative overhead
in Canada, on a percentage basis.[144]

7.2 Third-party payment problem and


consumer-driven insurance
Most Americans pay for medical services largely through
insurance, and this can distort the incentives of consumers since the consumer pays only a portion of the
ultimate cost directly.[68] The lack of price information
on medical services can also distort incentives.[68] The
insurance which pays on behalf of insureds negotiate
with medical providers, sometimes using governmentestablished prices such as Medicaid billing rates as a reference point.[68] This reasoning has led for calls to reform the insurance system to create a consumer-driven
health care system whereby consumers pay more out-ofpocket.[152] In 2003, the Medicare Prescription Drug, Improvement, and Modernization Act was passed, which encourages consumers to have a high-deductible health plan
and a health savings account.

According to the insurance industry group Americas


Health Insurance Plans, administrative costs for private
health insurance plans have averaged approximately 12%
of premiums over the last 40 years. There has been a shift
in the type and distribution of administrative expenses
over that period. The cost of adjudicating claims has
fallen, while insurers are spending more on other administrative activities, such as medical management, nurse
help lines, and negotiating discounted fees with health
7.3
care providers.[145]
A 2003 study published by the Blue Cross and Blue
Shield Association (BCBSA) also found that health insurer administrative costs were approximately 11% to
12% of premiums, with Blue Cross and Blue Shield plans
reporting slightly lower administrative costs, on average, than commercial insurers.[146] For the period 1998
through 2003, average insurer administrative costs declined from 12.9% to 11.6% of premiums. The largest
increases in administrative costs were in customer service
and information technology, and the largest decreases

Overall costs

The U.S. spends more as a percentage of GDP than similar countries, and this can be explained either through
higher prices for services themselves, higher costs to administer the system, or more utilization of these services,
or to a combination of these elements.[153]
Free-market advocates claim that the health care system is dysfunctional because the system of third-party
payments from insurers removes the patient as a major
participant in the nancial and medical choices that af-

12

SYSTEM EFFICIENCY AND EQUITY

to $10,600 in 2011, and were projected to be $11,000 by


2013.[157]
In March 2010, Massachusetts released a report on the
cost drivers which it called unique in the nation.[158]
The report noted that providers and insurers negotiate
privately, and therefore the prices can vary between
providers and insurers for the same services, and it found
that the variation in prices did not vary based on quality of care but rather on market leverage; the report also
found that price increases rather than increased utilization explained the spending increases in the past several
years.[158]
U.S. Healthcare Costs as a Percentage of GDP 20002011

7.4 Equity
7.4.1 Coverage

U.S. Healthcare Costs per Capita 20002011

fect costs. The Cato Institute claims that because government intervention has expanded insurance availability
through programs such as Medicare and Medicaid, this
has exacerbated the problem.[154] According to a study
paid for by Americas Health Insurance Plans (a Washington lobbyist for the health insurance industry) and carried out by PriceWaterhouseCoopers, increased utilization is the primary driver of rising health care costs in the
U.S.[155] The study cites numerous causes of increased
utilization, including rising consumer demand, new treatments, more intensive diagnostic testing, lifestyle factors,
the movement to broader-access plans, and higher-priced
technologies.[155] The study also mentions cost-shifting
from government programs to private payers. Low reimbursement rates for Medicare and Medicaid have increased cost-shifting pressures on hospitals and doctors,
who charge higher rates for the same services to private payers, which eventually aects health insurance
rates.[156]

Enrollment rules in private and governmental programs


result in millions of Americans going without health care
coverage, including children. The U.S. Census Bureau estimated that 45.7 million Americans (15.3% of the total
population) had no health insurance coverage in 2007.[66]
However, statistics regarding the insured population are
dicult to pinpoint for a number of factors, with the
Census Bureau writing that health insurance coverage
is likely to be underreported.[159] Further, such statistics do not provide insight into the reason a given person
might be uninsured. Studies have shown that approximately one third of this 45.7 million person population
of uninsured persons is actually eligible for government
insurance programmes such as Medicaid/Medicare, but
has elected not to enroll. The largest proportion of the
population of uninsured Americans is persons earning in
excess of $50,000 per annum, with those earning over
$75,000 p.a. comprising the fastest-growing segment of
the uninsured population. U.S. Citizens who earn too
much money to qualify for government assistance with
insurance programs but who do not earn enough to purchase a private health insurance plan make up approximately 2.7% percent of the total US population (8.2 million of approximately 300 million total population, by
2003 gures).[160]

States like California oer insurance coverage for children of low income families, but not for adults; other
states do not oer such coverage at all: both parent and child are caught in the notorious coverage
gap. Although EMTALA[161] certainly keeps alive
many working-class people who are badly injured, the
1986 law neither requires the provision of preventive or
rehabilitative care, nor subsidizes such care, and it does
Health care costs rising far faster than ination have been nothing about the diculties in the American mental
a major driver for health care reform in the United States. health system.
Surgical, injury, and maternal and neonatal health hospi- Coverage gaps also occur among the insured population.
tal visit costs increased by more than 2% each year from Johns Hopkins University professor Vicente Navarro
2003-2011. Further, while average hospital discharges stated in 2003, the problem does not end here, with the
remained stable, hospital costs rost from $9,100 in 2003 uninsured. An even larger problem is the underinsured"

7.4

Equity

and The most credible estimate of the number of people in the United States who have died because of lack
of medical care was provided by a study carried out
by Harvard Medical School Professors Himmelstein and
Woolhandler.[162] They concluded that almost 100,000
people died in the U.S. yearly because of lack of needed
care.[163] Another study by the Commonwealth Fund
published in Health Aairs estimated that 16 million U.S.
adults were underinsured in 2003. The study dened
underinsurance as characterized by at least one of the
following conditions: annual out-of-pocket medical expenses totaling 10% or more of income, or 5% or more
among adults with incomes below 200% of the federal
poverty level; or health plan deductibles equaling or exceeding 5% of income. The underinsured were signicantly more likely than those with adequate insurance to
forgo health care, report nancial stress because of medical bills, and experience coverage gaps for such items
as prescription drugs. The study found that underinsurance disproportionately aects those with lower incomes 73% of the underinsured in the study population had annual incomes below 200% of the federal poverty level.[164] Another study focusing on the
eect of being uninsured found that individuals with
private insurance were less likely to be diagnosed with
late-stage cancer than either the uninsured or Medicaid
beneciaries.[126] A study examining the eects of health
insurance cost-sharing more generally found that chronically ill patients with higher co-payments sought less care
for both minor and serious symptoms while no eect on
self-reported health status was observed. The authors
concluded that the eect of cost sharing should be carefully monitored.[165]
Coverage gaps and aordability also surfaced in a 2007
international comparison by the Commonwealth Fund.
Among adults surveyed in the U.S., 37% reported that
they had foregone needed medical care in the previous
year because of cost; either skipping medications, avoiding seeing a doctor when sick, or avoiding other recommended care. The rate was higher 42% among
those with chronic conditions. The study reported that
these rates were well above those found in the other six
countries surveyed: Australia, Canada, Germany, the
Netherlands, New Zealand, and the UK.[166] The study
also found that 19% of U.S. adults surveyed reported serious problems paying medical bills, more than double
the rate in the next highest country.
7.4.2

Mental health

See also: Emotional mental health in the United States


and Mentally ill prisoners in the United States
A lack of mental health coverage for Americans bears
signicant ramications to the U.S. economy and social
system. A report by the U.S. Surgeon General found that
mental illnesses are the second leading cause of disability

13
in the nation and aect 20% of all Americans.[167] It
is estimated that less than half of all people with mental illnesses receive treatment (or specically, an ongoing, much needed, and managed care; where medication
alone, cannot easily remove mental conditions) due to
factors such as stigma and lack of access to care.[168]
The Paul Wellstone Mental Health and Addiction Equity
Act of 2008 mandates that group health plans provide
mental health and substance-related disorder benets that
are at least equivalent to benets oered for medical and
surgical procedures. The legislation renews and expands
provisions of the Mental Health Parity Act of 1996. The
law requires nancial equity for annual and lifetime mental health benets, and compels parity in treatment limits
and expands all equity provisions to addiction services.
Insurance companies and third-party disability administrators (most notably, Sedgwick CMS) used loopholes
and, though providing nancial equity, they often worked
around the law by applying unequal co-payments or setting limits on the number of days spent in inpatient or
outpatient treatment facilities.[169][170]

7.4.3 Medical underwriting and the uninsurable


In most states in the U.S., people seeking to purchase
health insurance directly must undergo medical underwriting. Insurance companies seeking to mitigate the
problem of adverse selection and manage their risk pools
screen applicants for pre-existing conditions. Insurers reject many applicants or quote increased rates for those
with pre-existing conditions. Diseases that can make an
individual uninsurable include serious conditions, such as
arthritis, cancer, and heart disease, but also such common
ailments as acne, being 20 pounds over or under weight,
and old sports injuries.[171] An estimated 5 million of
those without health insurance are considered uninsurable because of pre-existing conditions.[172]
Proponents of medical underwriting argue that it ensures
that individual health insurance premiums are kept as
low as possible.[173] Critics of medical underwriting believe that it unfairly prevents people with relatively minor and treatable pre-existing conditions from obtaining
health insurance.[174]
One large industry survey found that 13% of applicants
for individual health insurance who went through medical underwriting were denied coverage in 2004. Declination rates increased signicantly with age, rising from 5%
for those under 18 to just under one-third for those aged
60 to 64.[175] Among those who were oered coverage,
the study found that 76% received oers at standard premium rates, and 22% were oered higher rates.[176] The
frequency of increased premiums also increased with age,
so for applicants over 40, roughly half were aected by
medical underwriting, either in the form of denial or increased premiums. In contrast, almost 90% of applicants
in their 20s were oered coverage, and three-quarters of

14
those were oered standard rates. Seventy percent of applicants age 6064 were oered coverage, but almost half
the time (40%) it was at an increased premium. The study
did not address how many applicants who were oered
coverage at increased rates chose to decline the policy.
A study conducted by the Commonwealth Fund in 2001
found that, among those aged 19 to 64 who sought individual health insurance during the previous three years,
the majority found it unaordable, and less than a third
ended up purchasing insurance. This study did not distinguish between consumers who were quoted increased
rates due to medical underwriting and those who qualied for standard or preferred premiums.[177] Some states
have outlawed medical underwriting as a prerequisite for
individually purchased health coverage.[178] These states
tend to have the highest premiums for individual health
insurance.[179]

8 DRUG EFFICIENCY AND SAFETY

There is considerable research into inequalities in health


care. In some cases these inequalities are caused by income disparities that result in lack of health insurance and
other barriers to receiving services.[187] According to the
2009 National Healthcare Disparities Report, uninsured
Americans are less likely to receive preventive services in
health care.[188] For example, minorities are not regularly
screened for colon cancer and the death rate for colon
cancer has increased among African Americans and Hispanic people. In other cases, inequalities in health care
reect a systemic bias in the way medical procedures and
treatments are prescribed for dierent ethnic groups. Raj
Bhopal writes that the history of racism in science and
medicine shows that people and institutions behave according to the ethos of their times.[189] Nancy Krieger
wrote that racism underlies unexplained inequities in
health care, including treatment for heart disease,[190] renal failure,[191] bladder cancer,[192] and pneumonia.[193]
Raj Bhopal writes that these inequalities have been documented in numerous studies. The consistent and re7.4.4 Demographic dierences
peated ndings were that black Americans received less
health care than white Americans particularly when the
Main article: Race and health in the United States
care involved expensive new technology.[194] One recent
study has found that when minority and white patients
Health disparities are well documented in the U.S. in eth- use the same hospital, they are given the same standard
[195][196]
nic minorities such as African Americans, Native Amer- of care.
[180]
icans, and Hispanics.
When compared to whites,
these minority groups have higher incidence of chronic
diseases, higher mortality, and poorer health outcomes.
Among the disease-specic examples of racial and eth- 8 Drug eciency and safety
nic disparities in the United States is the cancer incidence
rate among African Americans, which is 25% higher See also: Regulation of therapeutic goods in the United
than among whites.[181] In addition, adult African Amer- States
icans and Hispanics have approximately twice the risk
as whites of developing diabetes and have higher over[197]
is the priall obesity rates.[182] Minorities also have higher rates of The Food and Drug Administration (FDA)
mary
institution
tasked
with
the
safety
and
eectiveness
[181]
cardiovascular disease and HIV/AIDS than whites.
of human and veterinary drugs. It also is responsible for
Caucasian Americans have much lower life expectancy
[183]
than Asian Americans.
A 2001 study found large making sure drug information is accurately and informatively presented to the public. The FDA reviews and apracial dierences exist in healthy life expectancy at lower
proves products and establishes drug labeling, drug stan[184]
levels of education.
dards, and medical device manufacturing standards. It
Public spending is highly correlated with age; average sets performance standards for radiation and ultrasonic
per capita public spending for seniors was more than equipment.
ve times that for children ($6,921 versus $1,225). Average public spending for non-Hispanic blacks ($2,973) One of the more contentious issues related to drug safety
was slightly higher than that for whites ($2,675), while is immunity from prosecution. In 2004, the FDA respending for Hispanics ($1,967) was signicantly lower versed a federal policy, arguing that FDA premarket apthan the population average ($2,612). Total public spend- proval overrides most claims for damages under state law
by the
ing is also strongly correlated with self-reported health for medical devices. In 2008 this was conrmed
[198]
Riegel
v.
Medtronic.
Supreme
Court
in
status ($13,770 for those reporting poor health versus
$1,279 for those reporting excellent health).[67] Seniors On June 30, 2006, an FDA ruling went into eect excomprise 13% of the population but take 1/3 of all pre- tending protection from lawsuits to pharmaceutical manscription drugs. The average senior lls 38 prescriptions ufacturers, even if it was found that they submitted fraudannually.[185] A new study has also found that older men ulent clinical trial data to the FDA in their quest for
and women in the South are more often prescribed antibi- approval. This left consumers who experience serious
otics than older Americans elsewhere, even though there health consequences from drug use with little recourse.
is no evidence that the South has higher rates of diseases In 2007, the House of Representatives expressed opporequiring antibiotics.[186]
sition to the FDA ruling, but the Senate took no action.

9.2

Debate

On March 4, 2009, an important U.S. Supreme Court decision was handed down. In Wyeth v. Levine, the court
asserted that state-level rights of action could not be preempted by federal immunity and could provide appropriate relief for injured consumers.[199] In June 2009,
under the Public Readiness and Emergency Preparedness
Act, Secretary of Health and Human Services Kathleen
Sebelius signed an order extending protection to vaccine
makers and federal ocials from prosecution during a
declared health emergency related to the administration
of the swine u vaccine.[200][201]

8.1

Impact of drug companies

15
companies would earn in an open market versus what they
are earning now) to drug companies or to the U.S. government. In turn, pharmaceutical companies would be
able to continue to produce innovative pharmaceuticals
while lowering prices for U.S. consumers. Currently, the
U.S., as a purchaser of pharmaceuticals, negotiates some
drug prices but is forbidden by law from negotiating drug
prices for the Medicare program due to the Medicare
Prescription Drug, Improvement, and Modernization Act
passed in 2003. Democrats have charged that the purpose of this provision is merely to allow the pharmaceutical industry to proteer o of the Medicare program,
which is already in imminent danger of becoming nancially insolvent.[207]

The U.S. is one of two countries in the world that allows


9.2 Debate
direct-to-consumer advertising of prescription drugs.
Critics note that drug advertisements cost money which
Main article: Health care reform in the United States
they believe have raised the overall price of drugs.[202]
When health care legislation was being written in 2009,
A poll released in March 2008 by the Harvard School
the drug companies were asked to support the legislation
of Public Health and Harris Interactive found that Amerin return for not allowing importation of drugs from foricans are divided in their views of the U.S. health syseign countries.[203]
tem, and that there are signicant dierences by political aliation. When asked whether the U.S. has the
best health care system or if other countries have better systems, 45% said that the U.S. system was best and
9 Political issues
39% said that other countries systems are better. Belief
that the U.S. system is best was highest among Republi9.1 Prescription drug prices
cans (68%), lower among independents (40%), and lowest among Democrats (32%). Over half of Democrats
Main article: Prescription drug prices in the United States (56%) said they would be more likely to support a presidential candidate who advocates making the U.S. sysDuring the 1990s, the price of prescription drugs be- tem more like those of other countries; 37% of indepencame a major issue in American politics as the prices dents and 19% of Republicans said they would be more
of many new drugs increased exponentially, and many likely to support such a candidate. 45% of Republicans
citizens discovered that neither the government nor their said that they would be less likely to support such a caninsurer would cover the cost of such drugs. Per capita, didate, compared to 17% of independents and 7% of
the U.S. spends more on pharmaceuticals than any other Democrats.[208][209]
country. National expenditures on pharmaceuticals ac- A 2004 Institute of Medicine (IOM) report said, the
counted for 12.9% of total health care costs, compared United States is among the few industrialized nations
to an OECD average of 17.7% (2003 gures).[204] Some in the world that does not guarantee access to health
25% of out-of-pocket spending by individuals is for pre- care for its population.[43] There is currently an ongoscription drugs.[205]
ing political debate centering around questions of acThe U.S. government has taken the position (through the
Oce of the United States Trade Representative) that
U.S. drug prices are rising because U.S. consumers are
eectively subsidizing costs which drug companies cannot recover from consumers in other countries (because
many other countries use their bulk-purchasing power to
aggressively negotiate drug prices).[206] The U.S. position (consistent with the primary lobbying position of the
Pharmaceutical Research and Manufacturers of America) is that the governments of such countries are free riding on the backs of U.S. consumers. Such governments
should either deregulate their markets, or raise their domestic taxes in order to fairly compensate U.S. consumers
by directly remitting the dierence (between what the

cess, eciency, quality, and sustainability. Whether a


government-mandated system of universal health care
should be implemented in the U.S. remains a hotly debated political topic, with Americans divided along party
lines in their views of the U.S. health system and what
should be done to improve it. Those in favor of universal
health care argue that the large number of uninsured
Americans creates direct and hidden costs shared by all,
and that extending coverage to all would lower costs
and improve quality.[210] Cato Institute Senior Fellow
Alan Reynolds argues that people should be free to opt
out of health insurance, citing a study by Economists
Craig Perry and Harvey Rosen that found the lack of
health insurance among the self-employed does not af-

16

11 HEALTH INSURANCE COVERAGE FOR IMMIGRANTS

fect their health. For virtually every subjective and objective measure of their health status, the self-employed
and wage-earners are statistically indistinguishable for
each other.[211] Both sides of the political spectrum have
also looked to more philosophical arguments, debating
whether people have a fundamental right to have health
care provided to them by their government.[212][213]

10 Reform

Advocates for single-payer health care often point to


other countries, where national government-funded systems produce better health outcomes at lower cost. Opponents deride this type of system as "socialized medicine",
and it has not been one of the favored reform options
by Congress or the President in both the Clinton and
Obama reform eorts.[218][219] It has been pointed out
that socialized medicine is a system in which the government owns the means of providing medicine. England is
an example of socialized system, as, in America, is the
Veterans Health Administration. Medicare is an example of a mostly single-payer system, as is France. Both of
these systems have private insurers to choose from, but
the government is the dominant purchaser.[220]

of claims based on pre-existing conditions, establishing


health insurance exchanges, prohibiting insurers from establishing annual spending caps and support for medical
research. The costs of these provisions are oset by a
variety of taxes, fees, and cost-saving measures, such as
new Medicare taxes for high-income brackets, taxes on
indoor tanning, cuts to the Medicare Advantage program
in favor of traditional Medicare, and fees on medical devices and pharmaceutical companies;[228] there is also a
tax penalty for citizens who do not obtain health insurance (unless they are exempt due to low income or other
reasons).[229] The Congressional Budget Oce estimates
that the net eect (including the reconciliation act) will
be a reduction in the federal decit by $143 billion over
the rst decade.[230]

The Patient Protection and Aordable Care Act (Public


Law 111-148) is a health care reform bill that was signed
into law in the United States by President Barack Obama
on March 23, 2010. Along with the Health Care and Education Reconciliation Act of 2010 (passed March 25),
An impediment to implementing any U.S. healthcare re- the Act is a product of the health care reform agenda of
form that does not benet insurance companies or the pri- the Democratic 111th Congress and the Obama adminisvate health care industry is the power of insurance com- tration.
pany and health care industry lobbyists.[214][215] Possibly The law includes a large number of health-related proas a consequence of the power of lobbyists, key politi- visions to take eect over the next four years, including
cians such as Senator Max Baucus have taken the op- expanding Medicaid eligibility for people making up to
tion of single payer health care o the table entirely.[216] 133% of FPL,[225] subsidizing insurance premiums for
In a June 2009 NBC News/Wall Street Journal survey, peoples making up to 400% of FPL ($88,000 for fam76% said it was either extremely or quite important ily of 4) so their maximum out-of-pocket pay will be
to give people a choice of both a public plan adminis- from 2% to 9.8% of income for annual premium,[226][227]
tered by the federal government and a private plan for providing incentives for businesses to provide health
their health insurance.[217]
care benets, prohibiting denial of coverage and denial

As an example of how government intervention has had


unintended consequences, in 1973, the federal government passed the Health Maintenance Organization Act,
which heavily subsidized the HMO business model a
model that was in decline prior to such legislative intervention. The law was intended to create market incentives
that would lower health care costs, but HMOs have never
achieved their cost-reduction potential.[221]
Piecemeal market-based reform eorts are complex.
One study evaluating current popular market-based reform policy packages concluded that if market-oriented
reforms are not implemented on a systematic basis with
appropriate safeguards, they have the potential to cause
more problems than they solve.[222]
According to economist and former U.S. Secretary of Labor, Robert Reich, only a big, national, public option"
can force insurance companies to cooperate, share information, and reduce costs. Scattered, localized, insurance cooperatives are too small to do that and are designed to fail by the moneyed forces opposing Democratic health care reform.[223][224] The Patient Protection
and Aordable Care Act, signed into law in March 2010,
did not include such an option.

In May 2011, the state of Vermont became the rst state


to pass legislation establishing a Single-Payer health care
system. The legislation, known as Act 48, establishes
health care in the state as a human right and lays the
responsibility on the state to provide a health care system
which best meets the needs of the citizens of Vermont.
The state is currently in the studying phase of how best to
implement this system.

11 Health insurance coverage for


immigrants
Of the 26.2 million foreign immigrants living in the
US in 1998, 62.9% were non-U.S. citizens. In 1997,
34.3% of non-U.S. citizens living in America did not
have health insurance coverage opposed to the 14.2% of
native-born Americans who do not have health insurance
coverage. Among those immigrants who became citizens, 18.5% were uninsured, as opposed to noncitizens,
who are 43.6% uninsured. In each age and income group,
immigrants are less likely to have health insurance.[231]

17
With the recent healthcare changes, many legal immigrants with various immigration statuses now are able
qualify for aordable health insurance.[232] Options vary
according to the immigrants age and how long they have
been permanent residents.[233]

Military Health System


School health services
United States National Health Care Act
Universal Health Care Foundation of Connecticut

12

Health insurance coverage for


visitors to the U.S.

Water uoridation in the United States

14 Notes
Visitors to the U.S. cannot purchase health insurance
that is available for U.S. citizens and permanent residents. Most domestic insurance policies purchased overseas cease to be eective inside the U.S., when individuals cross their home country borders during international
travel. Currently, it is not mandatory for short-term visitors to U.S. to provide proof of travel medical insurance
coverage to obtain a legal visa to enter the U.S. However,
considering cost of healthcare for the uninsured in the
U.S., many foreigners without residence in the U.S., and
visiting the U.S. can benet by buying a visitors health insurance protection plan that covers emergency expenses
such as medical evacuation and treatment for sickness or
injuries while in the U.S.[234]

13

See also

Canadian and American health care systems compared


Centers for Disease Control and Prevention timeline
Key person insurance
Health care compared tabular comparisons of the
US, Canada, and other countries not shown above.
Health care industry
Health care politics
Health care systems (including comparisons)
Health insurance cooperative
Healthy people
HIV/AIDS in the United States
List of healthcare accreditation organizations in the
United States
List of countries by health care expenditures

[1] Falling from 12th in 1960 to 23d in 1990 to 29th in 2004

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16

Further reading

Burnham, John C. Health Care in America: A history


(2014)

United States prole from the World Health Organization *


Health Care in the United States at DMOZ
FamiliesUSA contains links to numerous studies and
literature about various aspects of health care in the
US.

26

18

18
18.1

TEXT AND IMAGE SOURCES, CONTRIBUTORS, AND LICENSES

Text and image sources, contributors, and licenses


Text

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File:Edit-clear.svg Source: https://upload.wikimedia.org/wikipedia/en/f/f2/Edit-clear.svg License: Public domain Contributors: The


Tango! Desktop Project. Original artist:
The people from the Tango! project. And according to the meta-data in the le, specically: Andreas Nilsson, and Jakub Steiner (although
minimally).
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18.3

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Economic Advisers (2009-06). The Economic Case for Health Care Reform (PDF) 10. Executive Oce of the President of the United
States. Retrieved on 2009-08-25. Original artist: Council of Economic Advisers to the President of the United States
File:Life_expectancy_vs_healthcare_spending.jpg Source: https://upload.wikimedia.org/wikipedia/commons/d/d6/Life_expectancy_
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Wisdom Magazine, Aug. 1956 (Vol 1, No. 8)
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