Healthcare part 4 (Conclusion) (orig 4/17/2011)

OK, let's wrap up the discussion of what we can learn from other healthcare systems by taking a quick look at Germany, the foreign country that most closely resembles the USA in healthcare for those under 65. Healthcare providers are mostly private businesses, payment is through private insurance plans with premiums paid by an employee/employer arrangement. Here are a few additional details about healthcare in Germany:

1) On a per capita basis, their system costs about one-half what the USA system costs, yet they cover everyone from cradle to nursing home.

2) Everyone is covered and everyone must participate. (An exception is made for the very-wealthy who are allowed to opt-out of the system and provide for themselves, That's currently about 7% of the German population.)

3) Waiting times to see a doctor or have a surgical procedure are about the same as in the USA. The quality of care is world-class. Germany stands at or near the top of all comparative healthcare studies.

4) Here is a fundamental difference. While the insurance plans are private, they are not allowed to make a profit. (In fact, the USA is the only country which allows private medical insurance plans to make a profit.) How do the plans compete if not on profit for stockholders? They compete on service, such as paying claims faster than other companies. Better service will attract more participants to your plan (and Germans can choose any one of about 200 health insurance plans), and the more participants your plan has the higher the salaries of the plan executives, and the more "clout" it has negotiating prices with doctors and hospitals.

5) Because the insurance plans are non-profit (as almost all USA plans were until about 20 years ago), there is no need for huge layers of people to look over claims and find ways to "wiggle out" of paying then. (USA plans refer to paying a claim as a "medical loss" and, like most insurance companies, they try to limit their losses.) German plans must cover everyone from birth, so there is no such thing as a "preexisting condition." There is no need for large "underwriting" departments which look for ways to exclude people who might actually use their medical insurance, or look for ways to cancel a policy if someone actually gets seriously ill. German medical insurance plans operate with about a 5% administrative overhead, compared with a 20-30% overhead for USA for-profit plans.

6) Did anyone ever advise you to make a list of your medications and allergies to stick inside your wallet on a slip of paper, in case of a medical emergency? French and German citizens have something much better. They carry what looks like a credit card, but this card has "smart chip" which contains your complete medical history. Every X-ray, shot, test, procedure, etc. is contained in the memory of this chip. When you go to your doctor's office you will not see the cabinets stuffed full of medical records. They have all been digitized. Do we have anything to learn from them?

Isn't there any problem with the German system? Of course! If you look at any system there will be difficulties. German doctors feel underpaid. They make the equivalent of $100-150,000, can drive a BMW and join the local country club, but they do complain about their pay. (It should also be noted that doctors in Germany--as in many other countries--pay nothing to attend medical school, so they do not begin their careers with the crushing debt of many American doctors.)

By the way, when you're looking inside healthcare systems, you'll discover more if you are an actual patient rather than just stopping in for a chat with the doctor. Reid had a bum shoulder held together by screws from an old navy injury. He was able to see how each system would suggest to treat it, and what kind of wait he would experience for orthopedic surgery.

Here are some other quick items he discovered in other countries:

a) The Japanese go to their doctor about 5 times more than Americans, and they don't make appointments. They just show up, and are seen. Reid tried this with the top ortho specialist in Tokyo and was seen the same day. When he asked how long he would have to wait for a shoulder surgery, the doctor said, "Tomorrow would be difficult, but next week would not be a problem."

b) France has more doctors per capita than the USA, and more hospital beds.

c) In many other countries, if you lose your job you do not lose your health insurance. The government will assist with premiums until you find new employment.

d) In many other countries, doctors still make house calls. Think about what happens here. You're really sick and in bed, but you have only two choices for medical attention: drag yourself coughing, vomiting, etc. to the waiting room of your doctor's office or get yourself to the emergency room of a hospital.

Well, what about Canada? After all, it's right next door, so Americans feel that they know a lot about the Canadian system. Their impression? High taxes and long waits.

Don't forget that Canadians pay for a lot of things through their taxes, so generally high taxes does not necessarily mean high healthcare costs. Canada has generally better healthcare statistics than the USA, and achieves them at about half the cost per capita as our system.

Well, what about those waiting times? If you require care for an acute illness, accident or emergency your care will be as quick as in the USA. If your medical problem is not urgent enough for immediate attention, that's where the waiting happens. When Reid asked about his shoulder, he was told that it would take him about a year to get a consultation with a specialist, and another 6 months before surgery. That's a problem that Canadians generally don't like, and they're working on wait times. 

The one thing about their system that makes Canadians proud is that everyone, rich or poor, is treated equally. They don't mind waiting if they know that the rich also wait in line with them. What does bother them is someone buying their way to the front of the line, so the Canadian system is designed to prevent that.

According to Reid: "It has been widely reported on both sides of the border, that millions of Canadians stuck on the waiting list travel to the United States to pay for the care they could not get in the free Canadian system. This 'fact' is satisfying to advocates of private-market health care, both in Canada and in the United States; it seems to prove that government-run healthcare can't work. In fact, though, the race to the south is mainly fictional. The anecdotal reports are not supported by any statistical research. Expert studies of the 'health care refugee' issue have concluded that the actual number of snowbirds heading south for health care is tiny."

To summarize: The USA has a healthcare system at least twice as expensive as other rich countries, yet our statistical outcomes put us way behind most other industrialized nations in the effectiveness of our healthcare system.

If we are willing to recognize that we are not always the smartest people on the face of the planet, we could learn from the laboratory of other nations and make adjustments to our healthcare system which might drastically reduce the cost, and allow us to deal with our nation's primary budget problem.

We must remember that there is no silver bullet. Just because we find a problem area in another nation's system, doesn't mean that we can't learn from the elements of the system that are working well.

And finally, we must be willing to work at it. "It's difficult" cannot be an excuse. Winning WWII was difficult, but it was necessary for the nation. Making healthcare affordable is equally difficult, and equally necessary.

Thanks for listening!