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U.S. Not Getting Bang for Buck in Healthcare Spending

Analysis  |  By Christopher Cheney  
   January 31, 2023

A new healthcare report from The Commonwealth Fund finds that the United States does not compare favorably to other high-income countries.

Despite spending more on healthcare than other high-income countries, the United States lags peer countries in several measures of healthcare performance, according to a new report from The Commonwealth Fund.

The new report mirrors the findings of a 2020 report from The Commonwealth Fund. The 2020 report found that the United States spent nearly twice as much on healthcare as the average level of spending at Organisation for Economic Co-operation and Development (OECD) countries and had the lowest life expectancy and highest suicide rates among 11 OECD countries.

The new report, which was published today, compares U.S. healthcare to healthcare in Australia, Canada, France, Germany, Japan, the Netherlands, New Zealand, Norway, South Korea, Sweden, Switzerland, and the United Kingdom. The report also compares U.S. healthcare to average performance for the 38 high-income OECD countries for which data are available.

In 2021, the United States spent 17.8% of its gross domestic product on healthcare, which was nearly twice the level of spending of the average OECD country, according to the new report.

In the new report, the United States compared unfavorably with other OECD countries on several measures:

  • In 2021, 8.6% of Americans were uninsured, and the United States was the only high-income country with a substantial segment of the population with no form of health insurance.
     
  • In 2020, U.S. life expectancy at birth was 77 years, which was three years lower than the OECD average.
     
  • In 2020, the United States had the highest avoidable mortality rate among all of the countries in The Commonwealth Fund's analysis. Avoidable mortality is defined as deaths that are preventable and treatable through public health measures and primary prevention such as exercise.
     
  • In 2020, the U.S. infant mortality rate was 5.4 deaths per 1,000 live births, which was the highest rate among all the countries in the analysis.
     
  • In 2020, there were nearly 24 maternal deaths for every 100,000 live births in the United States, which was more than three times the rate in most of the other high-income countries.
     
  • The United States had the third-highest suicide rate among OECD countries.
     
  • The United States had far more deaths from physical assault including gun violence, with 7.4 deaths per 100,000 people compared to the OECD average of 2.7.
     
  • The United States has an obesity rate nearly two times higher than the OECD average.
     
  • In 2020, nearly one-third of U.S. adults reported being diagnosed with two or more chronic conditions in survey data. In other OECD countries, no more than a quarter of residents reported being diagnosed with two or more chronic conditions.
     
  • More Americans have died from the coronavirus than residents in other OECD countries.
     
  • Americans visit a doctor less than the OECD average, with four visits per American per year.
     
  • The United States has fewer hospital beds than most other OECD countries, with 2.8 hospital beds per 1,000 population compared to the OECD average of 4.3 hospital beds.
     
  • The United States has one of the lowest COVID-19 vaccination rates compared to other high-income countries.

Addressing U.S. shortcomings

The new report calls on the United States to boost the availability of affordable healthcare services. "While the United States spends more on healthcare than any other high-income country, the nation often performs worse on measures of health and healthcare. For the U.S., a first step to improvement is ensuring that everyone has access to affordable care. Not only is the U.S. the only country we studied that does not have universal health coverage, but its health system can seem designed to discourage people from using services," the report's co-authors wrote.

The new report says the United States can take three additional steps to generate better healthcare outcomes from healthcare spending:

  • Implementation of the Inflation Reduction Act, which reduces the cost of some drugs and caps out-of-pocket costs for older Americans.
     
  • Cost containment: "Other countries have achieved better health outcomes while spending much less on healthcare overall. In the U.S., high prices for health services continue to be the primary driver of this elevated spending," the report's co-authors wrote.
     
  • Improved prevention and management of chronic conditions: "Critical to this is developing the capacity to offer comprehensive, continuous, well-coordinated care. Decades of underinvestment, along with an inadequate supply of healthcare providers, have limited many Americans' access to effective primary care," the report's co-authors wrote.

Related: CMS Projection: Healthcare Spending Expected to Reach $6.8 Trillion by 2030

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.


KEY TAKEAWAYS

In 2020, U.S. life expectancy at birth was 77 years, which was three years lower than the Organisation for Economic Co-operation and Development average.

In 2021, the United States spent 17.8% of its gross domestic product on healthcare, which was nearly twice the level of spending of the average OECD country, according to the new report.

More Americans have died from the coronavirus than residents in other OECD countries.


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