Health Care Outcomes

I’ve argued in the past that health care outcomes like infant mortality and life expectancies are not really very good measures of a country’s health care services since such outcomes are also a function of variables that are outside the control of health care services. A person who is morbidly obese and refuses to change their behavior irrespective of medical advice is going to have a shorter life span that a person who does not. Then there are other factors like accidental deaths, homicide rates, and so forth that also influence life expectancies, but are pretty much outside the realm of health care. For example, if you fall of your roof and die, what does that have to do with cancer treatments, low infant birth weights, etc. Are accidental deaths and homicide rate distributions uniform across countries? If not, then they could be factors that need to be controlled.

Now at the National Bureau of Economic Research we have this part of their Program Report on Health Economics,

June E. O’Neill and Dave M. O’Neill address the NHI issue by comparing Canada’s publicly funded, single-payer health care system to the multi-payer heavily private U.S. system.[31] They argue that differences between the United States and Canada in infant mortality and life expectancy — the two indicators most commonly used as evidence of better health outcomes in Canada — cannot be attributed to differences in the effectiveness of the two health care systems because they are strongly influenced by differences in cultural and behavioral factors, such as the relatively high U.S. incidence of obesity and of accidents and homicides. Direct measures of the effectiveness of medical care show that five-year relative survival rates for individuals diagnosed with various types of cancer are higher in the United States than in Canada, as are infant survival rates of low-birthweight babies. These successes are consistent with the greater U.S. availability of high level technology, higher rates of screening for cancers, and higher treatment rates of the chronically ill. The need to ration when care is delivered “free” ultimately leads to long waits. The health-income gradient is at least as prominent in Canada as it is in the United States.

In other words, when one looks at specific instances of U.S. vs. Canadian health care outcomes the U.S. does come out ahead. Does that justify the considerably higher costs? I don’t know, but it is something to consider. After all, getting a better outcome in terms of survivability for low birth weight babies might have a rather steep cost curve…or not.

This doesn’t mean that the U.S. system is better or that we don’t have to reform our health care system, we clearly need to. In fact, in reforming it we might have to accept lower survivability rates for both cancer patients and low birth weight babies.

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Steve Verdon
About Steve Verdon
Steve has a B.A. in Economics from the University of California, Los Angeles and attended graduate school at The George Washington University, leaving school shortly before staring work on his dissertation when his first child was born. He works in the energy industry and prior to that worked at the Bureau of Labor Statistics in the Division of Price Index and Number Research. He joined the staff at OTB in November 2004.

Comments

  1. odograph says:

    Higher costs?

    Help me understand this Wikipedia paragraph:

    Government and private health and public policy analysts have compared the health care systems of Canada and the United States.[1][2][3][4] The U.S. spends much more on health care than Canada, both on a per-capita basis and as a percentage of GDP.[5] In 2006, per-capita spending for health care in the U.S. was US$6,714; in Canada, US$3,678.[5] The U.S. spent 15.3% of GDP on health care in that year; Canada spent 10.0%.[5] In 2006, 70% of health care spending in Canada was financed by government, versus 46% in the United States. Total government spending per capita in the U.S. on health care was 23% higher than Canadian government spending, and U.S. government expenditure on health care was just under 83% of total Canadian spending (public and private).[6]

  2. Eric Florack says:

    In fact, in reforming it we might have to accept lower survivability rates for both cancer patients and low birth weight babies

    No ‘might’ about it. Any ‘money savings’ proposal, particularly from the government always ends up as a primary matter, restricting patient access to healthcare. Look into for example why HMO’s were started in the first place.

  3. sam says:

    In fact, in reforming it we might have to accept lower survivability rates for both cancer patients and low birth weight babies.

    Well, I’d like to see the packaging for those two things. And I’m not being snarky. That’s going to require one hell of a sales job. Especially where infants are concerned.

  4. steve says:

    First, I would highly recommend you read the New Yorker article, The Cost Conundrum. It is one of the best articles I have read this year on health care costs. Cowen had it on his site today. As a practicing physician I can tell you it addresses many of our problems.

    Second, there is debate in the cancer world about whether our outcomes are actually better. We treat some cancers very early that other countries do not.I have not looked at the Canadian data directly, but certainly compared with most European care, we come out slightly ahead. Cardiac care is another issue.

    Steve

  5. Drew says:

    Thank you, Steve.

    A point I’ve tried to make here for quite awhile. Blind adherence to aggregate statistics, without understanding, is just foolish.

    odo – See “blind adherence.”

    Sam and Bit – And this is of course one of the intractable problems. We as a society have not come to grips with letting Grandma go. We want those last 3 months, gruesome as they might be. As expensive as they might be. And let that newborn go? Unthinkable.

    I guarantee any assessment of health care costs will show wickedly disproportionate expenditures in the first and last six months of life.

    I have previously commented that the reintroduction of price and the reformation of health care expense reimbursement into “real” insurance are requirements for throttling health care expenditure.

    I add a social dilemma: what to do about the terminally ill?

    Not as easy as the sophomoric exhortations of our “leader”…”yes we can.” Eh?

  6. odograph says:

    Drew, I did not even get into the “outcomes” on that Wiki page. I just asked for an explanation of the lower costs claimed.

    That seems a simple enough datum.

  7. Drew says:

    odo –

    Wiki? Wiki?

    Please.

  8. spencer says:

    OK., I’ll buy your argument that survival rates in the US are longer than in Canada.

    But tell me, what do we pay to finance those longer survival rates. Just give me a simple data point, like millions of dollars per month of longer survival

  9. spencer says:

    Odograph:
    The last sentence you cite: and U.S. government expenditure on health care was just under 83% of total Canadian spending (public and private)

    is talking about a different ratio than the rest of the paragraph.

    In the US the govt accounts for under half of health care expenditure as compared to nearly 100% in Canada.
    This particular quote compares govt in US — under half of spending — to total spending in Canada.

    It is a poorly constructed paragraph to suddenly change what they are comparing.

  10. odograph says:

    Drew, the nice thing about Wikipedia is that it is the result of long-drawn battles between rational people. They are not in one camp or the other on a lot of things. At first sight I’m going to take them as several times more reliable than any blog or organ associated with an ideological vantage.

    If they make an error, let’s identify it, rather than making any random insults.

    Spencer, I think they are just trying to say the numbers lots of different ways. I thought this was interesting:

    In 2006, 70% of health care spending in Canada was financed by government, versus 46% in the United States.

    We do tend to think that “almost 100” percent of their care comes from the government, but apparently it isn’t true.

    I agree that the “83%” line is kind of pointless, once they’ve already talked per-capita and per-GDP.

  11. sam says:

    I guarantee any assessment of health care costs will show wickedly disproportionate expenditures in the first and last six months of life.

    Well, from my experience, working in a “hospital” for the aged and dying, the money spent didn’t seem “wickedly disporportionate.” The care provided was adequate, and that’s about all you could say for it. The place was basically a warehouse for the elderly on their way to death. For as long as I was there, I can only recall two, maybe three patients that left the hospital alive…and that was to go to another hospital. (It was something, I can tell you, to come in on a Monday morning after a weekend off, to find that seven patients on your wing–out of 20–had died over that weekend from a pulmonary virus that was running through the place.) It was only one hospital owned by a chain of such hospitals. I’ve no reason to believe that the others were any different. Now that I’m coming up on my seventh decade, I find myself thinking about what the chief nurse said to us in training: We all get to where these folks are.

  12. Steve Verdon says:

    spencer,

    What point do you think I’m making with my post cause I’m not sure you got it?

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  14. Grewgills says:

    Steve,
    The NBER papers referred to require subscription. Do you have access to the articles cited and if so could you provide the stats in the O’Neill and O’Neill paper?

  15. Eric Florack says:

    Sam and Bit – And this is of course one of the intractable problems. We as a society have not come to grips with letting Grandma go. We want those last 3 months, gruesome as they might be. As expensive as they might be. And let that newborn go? Unthinkable.

    Before you get too far down that road, consider that that sort of mentality is precisely why our life expectancy has been going steadily up over the years.

  16. sam says:

    @Drew:

    Sam and Bit – And this is of course one of the intractable problems. We as a society have not come to grips with letting Grandma go. We want those last 3 months, gruesome as they might be. As expensive as they might be.

    You know, I’m really trying to figure out what the right-wing take on all this is (and I’m not singling you out, Drew). You problem is as you (and I in an earlier thread) present it in the above. And yet, when someone acknowledges the problem, at least at the state level, and proposes action that, I assume, is the conservative solution, that is to say, the “financially realistic” solution, he gets this from a leading conservative blogger:

    It is cruel to be kind.

    Via the Mercury News, the cuts include eliminating welfare for 521,000 working families is gone. The checks averaged $526 a month. That saves $3.3 billion a year.

    And the newspaper reported, “Medi-Cal coverage for dialysis and for breast and cervical cancer treatment for those over age 65 would be cut. Undocumented immigrants would lose non-emergency health care.”

    There is your first taste of Obamacare. To save money, grandma will die of cancer.

    Well, WTF? Isn’t that what fically responsible conservatives say should have to happen? Isn’t that the correct, prudent thing to do? And yet, Surber uses it as a club to pound Obama. Since he’s widely read, I fully expect this to be picked up and spread throughout the right-wing blogosphere: Obamacare=grandmacide. I mean, W-T-F?

  17. sam says:

    You The problem is as you…

    Sorry…

  18. Steve Verdon says:

    Well, WTF? Isn’t that what fically responsible conservatives say should have to happen?

    I’d say, that, that is what people who are concerned about health care costs should say in general. We will allocate fewer resources to health care and thus, more people will die. Whether we do it via government fiat, letting things go on as they have and simply running out of said resources, or using the market….resources will eventually be reduced and people who otherwise would have gotten care wont. It isn’t a matter of if or possibly, its simply a matter of when, IMO.

    Grewgills,

    Nope haven’t looked at the paper itself yet, but they usually cost only $5 from NBER for a pdf version.

  19. sam says:

    I’d say, that, that is what people who are concerned about health care costs should say in general.

    OK, but you see my point, right?

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