Why the US pays far more than other countries for health care
http://www.americablog.com/2011/09/why-us-pays-far-more-than-other.html
Here's the gist of the CNBC story:
1. We like to sue doctors*.
2. If the government is the sole insurer, there's less paperwork for doctors.
3. Governments in other countries negotiate the price of prescription drugs - this is why in Europe I paid 1/5 to 1/6 of the US price for the same drugs manufactured by the same drug company.
4. Doctors, and particularly specialists, make a LOT of money in the states. less so abroad.
5. Yeah, there's some rationing, but... So you have to wait for a hip replacement in Canada. Whoop de doo. In the US, if you don't have insurance, you won't be able to even afford a hip replacement, and if you do have insurance, you'd better hope that your copay isn't very high, or the surgery isn't very expensive, or you still won't be able to afford it if you're fronting 50% of the cost (or even 20%).
*This was among the comments:
President Bush has been quoted as saying that the high prices of medical malpractice insurance-and thus the high costs of health insurance-“don’t start in an examining room or an operating room. They start in a courtroom.” But, according to recent articles in The New York Times, they may actually start on Wall Street.
In their February 22, 2005 article, “Behind Those Medical Malpractice Rates,” Joseph Treaster and Joel Brinkley observe that government and industry data don’t support the theory that legal costs are at the root of the increasing rise in premiums. “Lawsuits against doctors are just one of several factors that have driven up the cost of malpractice insurance,” they say. “Lately, the more important factors appear to be the declining investment earnings of insurance companies and the changing nature of competition in the industry.”
Some trial lawyer lobbies and patient care advocate groups contend that increases in medical malpractice insurance rates are primarily a result of insurance companies trying to make up for losses incurred in the stock market downturn of the late 1990s.
UAB economist Bryce S. Sutton, Ph.D., and Lance Nail, Ph.D., chair of the Department of Finance, say there is compelling evidence that security market returns have a significant, and inverse, association with malpractice insurance rates.
“Medical malpractice claims are negatively correlated with stock-market returns as measured by the S&P 500 Index over the time period from 1994 to 2002,” says Sutton. In other words, the lower the stock returns, the lower the payouts on malpractice claims-and the higher the premiums charged. “This divergence in medical malpractice premiums and stock-market returns is very clear after 1999,” Sutton says.
Nail agrees. “The negative correlation between stock-market returns and malpractice insurance rates is convincing,” he says. “Even though the data we examined covered only a short time frame, this relationship deserves more study.”
A subsequent July 7 article by the Times’s Jenny Anderson refers to a study by the Center for Justice and Democracy whose comprehensive analysis of 15 leading insurance companies from 2000 to 2004 found that malpractice premiums more than doubled while claims payouts remained essentially flat. These malpractice carriers increased net premiums by 120 percent during this five-year period, although their net claims payments rose only 5.7 percent. In 2004 these companies took in approximately three times more premiums than they paid in claims.
-Robert D. Phillips, M.D., M.P.H.
Here's the gist of the CNBC story:
1. We like to sue doctors*.
2. If the government is the sole insurer, there's less paperwork for doctors.
3. Governments in other countries negotiate the price of prescription drugs - this is why in Europe I paid 1/5 to 1/6 of the US price for the same drugs manufactured by the same drug company.
4. Doctors, and particularly specialists, make a LOT of money in the states. less so abroad.
5. Yeah, there's some rationing, but... So you have to wait for a hip replacement in Canada. Whoop de doo. In the US, if you don't have insurance, you won't be able to even afford a hip replacement, and if you do have insurance, you'd better hope that your copay isn't very high, or the surgery isn't very expensive, or you still won't be able to afford it if you're fronting 50% of the cost (or even 20%).
*This was among the comments:
President Bush has been quoted as saying that the high prices of medical malpractice insurance-and thus the high costs of health insurance-“don’t start in an examining room or an operating room. They start in a courtroom.” But, according to recent articles in The New York Times, they may actually start on Wall Street.
In their February 22, 2005 article, “Behind Those Medical Malpractice Rates,” Joseph Treaster and Joel Brinkley observe that government and industry data don’t support the theory that legal costs are at the root of the increasing rise in premiums. “Lawsuits against doctors are just one of several factors that have driven up the cost of malpractice insurance,” they say. “Lately, the more important factors appear to be the declining investment earnings of insurance companies and the changing nature of competition in the industry.”
Some trial lawyer lobbies and patient care advocate groups contend that increases in medical malpractice insurance rates are primarily a result of insurance companies trying to make up for losses incurred in the stock market downturn of the late 1990s.
UAB economist Bryce S. Sutton, Ph.D., and Lance Nail, Ph.D., chair of the Department of Finance, say there is compelling evidence that security market returns have a significant, and inverse, association with malpractice insurance rates.
“Medical malpractice claims are negatively correlated with stock-market returns as measured by the S&P 500 Index over the time period from 1994 to 2002,” says Sutton. In other words, the lower the stock returns, the lower the payouts on malpractice claims-and the higher the premiums charged. “This divergence in medical malpractice premiums and stock-market returns is very clear after 1999,” Sutton says.
Nail agrees. “The negative correlation between stock-market returns and malpractice insurance rates is convincing,” he says. “Even though the data we examined covered only a short time frame, this relationship deserves more study.”
A subsequent July 7 article by the Times’s Jenny Anderson refers to a study by the Center for Justice and Democracy whose comprehensive analysis of 15 leading insurance companies from 2000 to 2004 found that malpractice premiums more than doubled while claims payouts remained essentially flat. These malpractice carriers increased net premiums by 120 percent during this five-year period, although their net claims payments rose only 5.7 percent. In 2004 these companies took in approximately three times more premiums than they paid in claims.
-Robert D. Phillips, M.D., M.P.H.