By T.R.

Reid -- Five Myths About Health Care in the Rest of the World
By T.R. Reid Sunday, August 23, 2009

As Americans search for the cure to what ails our health-care system, we've overlooked an invaluable source of ideas and solutions: the rest of the world. All the other industrialized democracies have faced problems like ours, yet they've found ways to cover everybody -- and still spend far less than we do. I've traveled the world from Oslo to Osaka to see how other developed democracies provide health care. Instead of dismissin these models as !socialist,! we could adapt their solutions to fi" our problems. #o do that, we first have to dispel a few myths about health care abroad: $. It's all socialized medicine out there. Not so. Some countries, such as Britain, New Zealand and u!a, do "ro#ide health care in go#ernment hos"itals, with the go#ernment "aying the !ills. $thers %% &or instance, anada and Taiwan %% rely on "ri#ate%sector "ro#iders, "aid &or !y go#ernment%run insurance. But many wealthy countries %% including 'ermany, the Netherlands, (a"an and Swit)erland %% "ro#ide uni#ersal co#erage using "ri#ate doctors, "ri#ate hos"itals and "ri#ate insurance "lans. *n some ways, health care is less +sociali)ed+ o#erseas than in the ,nited States. Almost all Americans sign u" &or go#ernment insurance -.edicare/ at age 01. *n 'ermany, Swit)erland and the Netherlands, seniors stic2 with "ri#ate insurance "lans &or li&e. .eanwhile, the ,.S. 3e"artment o& 4eterans A&&airs is one o& the "lanet5s "urest e6am"les o& go#ernment%run health care. %. Overseas, care is rationed throu h limited choices or lon lines. 'enerally, no. 'ermans can sign u" &or any o& the nation5s 200 "ri#ate health insurance "lans %% a !roader choice than any American has. *& a 'erman doesn5t li2e her insurance com"any, she can switch to another, with no increase in "remium. The Swiss, too, can choose any insurance "lan in the country. *n 7rance and (a"an, you don5t get a choice o& insurance "ro#ider8 you ha#e to use the one designated &or your com"any or your industry. But "atients can go to any doctor, any hos"ital, any traditional healer. There are no ,.S.%style limits such as +in%networ2+ lists o& doctors or +"re%authori)ation+ &or surgery. 9ou "ic2 any doctor, you get treatment %% and insurance has to "ay. anadians ha#e their choice o& "ro#iders. *n Austria and 'ermany, i& a doctor diagnoses a "erson as +stressed,+ medical insurance "ays &or wee2ends at a health s"a. As &or those notorious waiting lists, some countries are indeed "lagued !y them. anada ma2es "atients wait wee2s or months &or nonemergency care, as a way to 2ee" costs down. But studies !y the ommonwealth 7und and others re"ort that many nations %% 'ermany,

Britain, Austria %% out"er&orm the ,nited States on measures such as waiting times &or a""ointments and &or electi#e surgeries. *n (a"an, waiting times are so short that most "atients don5t !other to ma2e an a""ointment. $ne Thursday morning in To2yo, * called the "restigious ortho"edic clinic at :eio ,ni#ersity ;os"ital to schedule a consultation a!out my aching shoulder. +<hy don5t you =ust dro" !y>+ the rece"tionist said. That same a&ternoon, * was in the surgeon5s o&&ice. 3r. Na2amichi recommended an o"eration. +<hen could we do it>+ * as2ed. The doctor chec2ed his com"uter and said, +Tomorrow would !e "retty di&&icult. ?erha"s some day ne6t wee2>+ &. 'orei n health-care systems are inefficient, bloated bureaucracies. .uch less so than here. *t may seem to Americans that ,.S.%style &ree enter"rise %% "ri#ate% sector, &or%"ro&it health insurance %% is naturally the most cost%e&&ecti#e way to "ay &or health care. But in &act, all the other "ayment systems are more e&&icient than ours. ,.S. health insurance com"anies ha#e the highest administrati#e costs in the world8 they s"end roughly 20 cents o& e#ery dollar &or nonmedical costs, such as "a"erwor2, re#iewing claims and mar2eting. 7rance5s health insurance industry, in contrast, co#ers e#ery!ody and s"ends a!out @ "ercent on administration. anada5s uni#ersal insurance system, run !y go#ernment !ureaucrats, s"ends 0 "ercent on administration. *n Taiwan, a leaner #ersion o& the anadian model has administrati#e costs o& A.1 "ercent8 one year, this &igure !allooned to 2 "ercent, and the o""osition "arties sa#aged the go#ernment &or wasting money. The world cham"ion at controlling medical costs is (a"an, e#en though its aging "o"ulation is a "ro&ligate consumer o& medical care. $n a#erage, the (a"anese go to the doctor A1 times a year, three times the ,.S. rate. They ha#e twice as many .R* scans and B%rays. Cuality is high8 li&e e6"ectancy and reco#ery rates &or ma=or diseases are !etter than in the ,nited States. And yet (a"an s"ends a!out D3,@00 "er "erson annually on health care8 the ,nited States s"ends more than DE,000. (. )ost controls stifle innovation. 7alse. The ,nited States is home to ground!rea2ing medical research, !ut so are other countries with much lower cost structures. Any American who5s had a hi" or 2nee re"lacement is standing on 7rench inno#ation. 3ee"%!rain stimulation to treat de"ression is a anadian !rea2through. .any o& the wonder drugs "romoted endlessly on American tele#ision, including 4iagra, come &rom British, Swiss or (a"anese la!s. $#erseas, strict cost controls actually dri#e inno#ation. *n the ,nited States, an .R* scan o& the nec2 region costs a!out DA,100. *n (a"an, the identical scan costs D9F. ,nder the "ressure o& cost controls, (a"anese researchers &ound ways to "er&orm the same diagnostic techniGue &or one%&i&teenth the American "rice. -And (a"anese la!s still ma2e a "ro&it./ *. +ealth insurance has to be cruel. Not really. American health insurance com"anies routinely re=ect a""licants with a +"ree6isting condition+ %% "recisely the "eo"le most li2ely to need the insurers5 ser#ice. They em"loy armies o& ad=usters to deny claims. *& a customer is hit !y a truc2 and &aces !ig medical !ills, the insurer5s +rescission de"artment+ digs through the records loo2ing &or

grounds to cancel the "olicy, o&ten while the #ictim is still in the hos"ital. The com"anies say they ha#e to do this stu&& to sur#i#e in a tough !usiness. 7oreign health insurance com"anies, in contrast, must acce"t all a""licants, and they can5t cancel as long as you "ay your "remiums. The "lans are reGuired to "ay any claim su!mitted !y a doctor or hos"ital -or health s"a/, usually within tight time limits. The !ig Swiss insurer 'rou"e .utuel "romises to "ay all claims within &i#e days. +$ur customers lo#e it,+ the grou"5s chie& e6ecuti#e told me. The corollary is that e#eryone is mandated to !uy insurance, to gi#e the "lans an adeGuate "ool o& rate%"ayers. The 2ey di&&erence is that &oreign health insurance "lans e6ist only to "ay "eo"le5s medical !ills, not to ma2e a "ro&it. The ,nited States is the only de#elo"ed country that lets insurance com"anies "ro&it &rom !asic health co#erage. *n many ways, &oreign health%care models are not really +&oreign+ to America, !ecause our cra)y%Guilt health%care system uses elements o& all o& them. 7or Nati#e Americans or #eterans, we5re BritainH The go#ernment "ro#ides health care, &unding it through general ta6es, and "atients get no !ills. 7or "eo"le who get insurance through their =o!s, we5re 'ermanyH ?remiums are s"lit !etween wor2ers and em"loyers, and "ri#ate insurance "lans "ay "ri#ate doctors and hos"itals. 7or "eo"le o#er 01, we5re anadaH I#eryone "ays "remiums &or an insurance "lan run !y the go#ernment, and the "u!lic "lan "ays "ri#ate doctors and hos"itals according to a set &ee schedule. And &or the tens o& millions without insurance co#erage, we5re Burundi or BurmaH *n the world5s "oor nations, sic2 "eo"le "ay out o& "oc2et &or medical care8 those who can5t "ay stay sic2 or die. This &ragmentation is another reason that we s"end more than any!ody else and still lea#e millions without co#erage. All the other de#elo"ed countries ha#e settled on one model &or health%care deli#ery and &inance8 we5#e !lended them all into a costly, con&using !ureaucratic mess. <hich, in turn, "unctures the most "ersistent myth o& allH that America has +the &inest health care+ in the world. <e don5t. *n terms o& results, almost all ad#anced countries ha#e !etter national health statistics than the ,nited States does. *n terms o& &inance, we &orce E00,000 Americans into !an2ru"tcy each year !ecause o& medical !ills. *n 7rance, the num!er o& medical !an2ru"tcies is )ero. BritainH )ero. (a"anH )ero. 'ermanyH )ero. 'i#en our remar2a!le medical assets %% the !est%educated doctors and nurses, the most ad#anced hos"itals, world%class research %% the ,nited States could !e, and should !e, the !est in the world. To get there, though, we ha#e to !e willing to learn some lessons a!out health% care administration &rom the other industriali)ed democracies. #.,. ,eid, a former -ashin ton .ost reporter, is the author of !#he +ealin of America: A /lobal 0uest for 1etter, )heaper, and 'airer +ealth )are,! to be published 2onday.