New Study Examines Why Americans Pay More for Healthcare

The blanket term used to describe hearing instrument specialists, audiologists and even otolaryngologists is hearing healthcare professional.  As the term implies, each of these professions is part of the greater healthcare sector of the economy. Hence, a recent study examining the drivers of cost in the American healthcare system should be of interest to everyone involved in delivering hearing care services.

A new study, published on March 13 in the Journal of the American Medical Association, finds that although the US spends twice as much on healthcare as ten other high-income nations, in many ways the American healthcare system is not that different than those of other wealthy countries. The study found that Americans don’t go to the doctor more often than others, has about the same number of primary care physicians, and provides people about the same number of hospitalizations and doctors’ visits. The quality of health care, too, is similar for the ten countries studied. Past reports have asserted all of these factors contribute to the higher cost of healthcare in the US relative to other countries.

 

There were two areas, however, where the US healthcare system is different.  Americans pay much higher prices for medical services, including hospitalization, doctors’ visits and prescription drugs. And the complex American healthcare payment system drives administrative costs substantially higher than those in other countries.

 

In the study, the US healthcare system was compared to several other countries, including the United Kingdom, Canada, Germany, Australia, Japan, Sweden, France, Denmark, the Netherlands and Switzerland.

Researchers used 98 indicators to compare countries across seven areas: general spending, population health, structural capacity, utilization, pharmaceuticals, access and quality and equity. The majority of the data came from international organizations, such as the Organization for Economic Cooperation and Development.

The researchers found that every sector of American healthcare had high price tags compared to the other countries studied. For example, the average salary for a general practice physician in the other countries was between $86,607 and $154,126. In the US, the average physician salary was $218,173.

Per capita spending for prescription drugs in other nations ranged from $466 to $939. In the US, spending on prescription drugs was $1,443 per person. Also, the United State spends considerably more on administrative costs. While other nations spend between 1%-3% to administer their health plans, administrative costs are 8% of total health spending in the US.

 

All of these factors result in American health costs that, as a percentage of gross domestic products, are nearly double that of other nations. In 2016, the US spent 17.8% of GDP, compared to 9.6%-12.4% in other countries. Given the high price of American healthcare, it could be surmised that it results in a higher quality of care and superior outcomes, but quality of care is roughly the same across the countries studied in this JAMA report.

 

Another eye opening finding in the study was the percentage of individuals with healthcare care coverage in each country. Just 90% of Americans have health insurance, leaving about 27 million people without access to healthcare. The other ten countries studies covered 99 to 100% of their citizens.

 

The Cost of (Hearing) Healthcare

 

Although the cost of hearing aids and other related services did not come under scrutiny in this study, it is not unreasonable to assume that many of the factors contributing to higher costs, such as inefficient billing practices, play a role in hearing healthcare.  Given the findings of the 2015 PCAST report and the 2016 NASEM report that were significant factors leading to the 2017 OTC legislation.

According to reports, the average retail price for a single hearing aid in the US private market is around $2,000, while experts in UK report that individuals in their private market pay the equivalent $1,500 per device. All told, this JAMA study points to ways all healthcare providers, including those in the hearing sector can contribute to lowering patients costs and improving efficiency of care.

 

 

*Featured image courtesy Flckr

 

1 Comment

  1. Currently the US is rated number 28 in the world as to quality of service yet we rate number 1 in the world by more than half compared to number 2 in expenses. 40% is paid on administrative costs. For every $17.00 spent on marketing the drug companies spend $1.00 on research. Universities do far more. The successful countries ahead of us as to cost and easier access to doctors use a single payer system. We have a choice. Pay for the high salaries of the HMO’s or have affordable and quality health care.

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