Beth Glasener Ware
Marylhurst University
April 18, 2014
Author Note This paper was prepared for HCM 510, Ethical Health Care Management, taught by Professor Browne.
Health Care System Comparisons – U.S. VS. Canada 2
Abstract
This paper defines both The United States Health Care System and the Canadian Health Care System. It compares the significant differences between the two. It provides in full detail the single-payer system verses the multi-payer system. Medical spending and administrative costs are outlined and compared. Wealth and Health is thoroughly explained regarding …show more content…
the impact it has on health care in the U.S. It also details the impact it would have as a Health Care Manager if the U.S. implemented a single-payer system. The paper is concluded with facts as to why the U.S. government should implement a single-payer system. The research comes from online (Internet) and offline (non-Internet) sources including books, articles, posts, websites and videos.
Keywords: United States Health Care System, Canadian Health Care System, U.S. verses Canadian Health Care Systems
Health Care System Comparisons - United States Verses Canada
Significant Differences – U.S. Verses Canada In regards to health care reform, the Canadian system is often held up as a possible model for the U.S. The two countries ' health care systems are very different-Canada has a single-payer, mostly publicly-funded system, while the U.S. has a multi payer system, heavily private system-but the countries appear to be culturally similar, suggesting that it might be possible for the U.S. to adopt the Canadian system. (O’Neil, 2007).
Much of the appeal of the Canadian system is that it seems to do more for less. Canada provides universal access to health care for its citizens, while nearly one in five non-elderly Americans is uninsured. Canada spends far less of its GDP on health care (10.4 percent, versus 16 percent in the U.S.) yet performs better than the U.S. on two commonly cited health outcome measures, the infant mortality rate and life expectancy. (O’Neil, 2007).
Single-Payer Health Care System If equity and social solidarity in access to health care and financing health care were fundamental goals of a health care system, the single payer system provides an ideal platform for achieving these goals. Single-payer systems typically are financed by general- or payroll taxes in a way that tailors the individual’s or family’s contribution to health-care financing to their ability to pay, rather than to their health status, which until this year has long been the practice in the individual health insurance market in the U.S. These systems protect individual households from financial ruin due to medical bills, such as health care bankruptcy. Single payer health systems typically afford patients free choice of health-care provider, although at the expense of not having a freedom of choice among different health insurers. Remarkably, in the U.S. households have some freedom of choice of health insurers – to the extent their employer offers them choice – but most Americans are confined to networks of providers for their insurance policy. In other words, Americans appear to have traded freedom of choice among providers for the sake of choice among insurers. (Cheng & Reinhardt, 2012) In single-payer systems “money follows the patient.” Therefore providers of health care must and do compete for patients on the basis of quality and patient satisfaction, but not price. In a single payer health insurance system, health insurance is fully portable from job to job and into unemployment status and retirement. The “job-lock” phenomenon prevalent in the US is unknown in those systems, contributing to labor-market efficiency. Because all funds to providers of health care in a single-payer system flow from one payer, it is relatively easy to control total health spending in such systems. Indeed, total national health spending as a percent of GDP in countries with single-payer systems is lower than it tends to be in non-single-payer health systems. This does not mean providers are left without a voice. Provider inputs are part of the formal negotiations over health-care budgets. (Cheng & Reinhardt 2012)
Single-Payer System – Cost Control For the most part, single-payer systems achieve their cost control by virtue of the monopolistic market power they enjoy as opposed to providers of health care. It is a countervailing power that the highly fragmented U.S. health-insurance system lacks as opposed to providers. As part of their effort to control total health spending, however, and to avoid the waste of excess capacity that easily develops in health care, some single-payer systems (Canada) put constraints on the physical capacity of their health system (number of inpatients beds, MRI scanners, etc.). That approach can lead to rationing by the queue. The alternative to rationing by such administrative devices, of course, is rationing by price and ability to pay, an approach used by design or by default in the United States. Rationing by price or by non-price mechanism are just alternative forms of rationing. (Cheng & Reinhardt 2012)
Single-Payer System - Electronic Billing A single-payer system is an ideal platform for a uniform electronic health information system of the sort, for example, used by our Veterans Administration health system (a single-payer system in its own right). There is a common nomenclature which enables 100% electronic billing and claims processing, thus yielding significant savings in administrative costs because they conveniently capture information on all health-care transactions, single-payer systems provide a data base that can be used for quality measurement, monitoring and improvement, and also for more basic research on what drives health spending and what clinical treatments works and does not work in health care. It enables evidence based medicine and the tracking of efficacy and safety of new drugs and devices once they are introduced after approval by government based on results of clinical trials. (Cheng & Reinhardt 2012)
Ralph Nadar outlines Canada’s Medicare verses Obamacare Political activist Ralph Nader recently outlined the advantages of Canada’s Medicare system over so-called Obamacare in the United States to an audience at Western University in London, Ont.: Following are some of the points outlined in his speech: In Canada, the administration of the system is simple. You get a health card when you are born. And you swipe it when you go to a doctor or hospital. End of story. In the United States, Obamacare’s 2,500 pages plus regulations (the Canadian Medicare bill was 13 pages) is so complex that then-speaker of the House Nancy Pelosi said before passage: “We have to pass the bill so that you can find out what is in it.” (Nadar, 2014) In Canada, the majority of citizens love their health-care system. In the United States, the majority of citizens, physicians and nurses prefer the Canadian-type system — single-payer, free choice of doctor and hospital, everybody in, nobody out. (Nadar 2014) In Canada, when you go to a doctor or hospital the first thing they ask you is: “What’s wrong?” In the United States, the first thing they ask you is: “What kind of insurance do you have?” (Nadar 2014) In Canada, the health-care system is funded by income, sales and corporate taxes that, combined, are much lower than what Americans pay in premiums. In the United States, under Obamacare, for thousands of Americans, its pay or die — if you can’t pay, you die. That’s why many thousands will still die every year under Obamacare from lack of health insurance to get diagnosed and treated in time. (Nadar 2014) In Canada, there are no complex hospital or doctor bills. In fact, usually you don’t even see a bill. In the United States, under Obamacare, hospital and doctor bills will still be terribly complex, making it impossible to discover the many costly overcharges. (Nadar 2014) In Canada, it is unheard of for anyone to go bankrupt due to health-care costs. In the United States, under Obamacare, health-care-driven bankruptcy will continue to plague Americans.
In Canada, health-care coverage stays with you for your entire life. In the United States, under Obamacare, for tens of millions of Americans, health-care coverage stays with you for as long as you can afford your share. (Nadar 2014)
Medical Spending Difference
Procedures, and Administrative Expenses,” Pozen & Cutler et al. (2012) examined differences in health spending between the U.S. and Canada. In their words, they “we found that administrative costs accounted for the greatest proportion (39%) of spending differences between the United States and Canada, followed by prices and medical care provision.” (Pozen &Cutler, et al. 2012)
Administrative Costs – Canada verses United States In their paper “U.S. Physician Practices Spend Nearly Four Times as Much Money Interacting with Health Plans and Payers Than Do Their Canadian Counterparts,”Morra, Nicholson and Levinson, et al.(2011) report the following results:
These numbers are outrageous and this can be prevented only if we as a country would agree to make the change and do what’s in the best interest for the people of our nation’s health. The Government must come together and determine a way to fix our health care problem. We are a free country with free rights; however, our health care system provides little if any freedom of choice that is if you can afford coverage.
Wealth and Health in the United States The U.S. is the richest country in the world yet 21% of the U.S. citizens are living in poverty and the number is increasing due to the high number of Health Bankruptcies. Aldeman and Poulain et al. (2008) The U.S. spends 2 trillion a year on health care. That is nearly half of all of the health care dollars spent in the entire world and there are still 47 million Americas that do not have health care coverage. How does this happen? We have all seen the statistics. Americans often have shorter and sicker lives than almost any other industrial nation in the world. We rank 30 in economically developed countries in the world, yet we are at the bottom of the list with our health. Aldeman and Poulaine et al. (2008) A higher percentage of babies die in their first year of life due to health complications and not being able to afford the care needed during pregnancy and after for themselves or their babies. How can the wealthiest country in the world let this happen? (Aldeman and Poulaine et al., 2008) Why are we getting sick? The answer is diet and behaviors and this is determined by income and education, which are called the Social Determinates of Health. Aldeman and Poulaine et al. (2008). In the PBS Unnatural Causes: In Sickness and in Wealth provides thorough examples and explanations as to the underlying causes of this epidemic within the U.S. One example from the video that details what is more powerful than genes is economic statuses. Identical twins that lived together in the same household until they were 18 years old with relatively similar exposure then they diverted later in life. One obtained a college education and was a professional while the other twin was in the working class. They ended up later in life with different health statuses. How could this be? One of the major factors is stress, which derives from wealth. In the brain you release Cortisol that comes from stress. The less Cortisol you release the less stressed you are and likewise the more Cortisol you release from your brain the more stressed you are. Stress is the leading cause to minor and major health problems. Aldeman and Poulaine et al. (2008) With less stress the better immune function you have. In order to prevent or manage your stress levels you need an accumulation of resources. You have to make healthy choices, which comes from money, time, resources, and economic status. It costs money for vacations, babysitters, healthy way of living and lifestyle, healthy food choices, gym memberships, health screenings, health coverage, and most importantly the time it takes to manage a stress free life. Lower class citizens do not have the means, the time, health coverage or any type of resources needed in order to manage their stress levels. The 21% of our population that is in poverty end up with lifelong health consequences and this starts from childhood. When your stress levels go up your hormones interfere with your brains circulatory connection. Again, we are the richest country in the world, yet 21% of our fellow citizens are in poverty with major and minor health conditions due to the lack of health care coverage. It was perfectly stated on PBS’s television series “Sick around the World” Wealth equals Health in America. (Palfreman, 2008) What can we do to fix the problem?
How the Changes Would Impact the Role as a Health Care Manager? I think there are a couple of ways these changes would affect the role of a Health Care Manager. First, I think that by implementing a Universal Single Payor System that it would decrease administrative issues and cut down on the costs of staff and ultimately impact the number of employees to manage. Secondly, it would increase the responsibility of the role as a Health Care Manager in that there will be an abundance of Americans that need care, so the hospitals and clinics will be full and will more than likely lead to longer than usual wait times. A major responsibility would be to make sure it is a smooth transition and that all of the patients are taken care of with exceptional patient care and outcomes. Organizational Motivation is also imperative with change. This generates a demand for innovation and change including a perceived demand for services, the need of an institution to fulfill its “destiny” and finally the need of people within the organization to get their own adrenaline flowing through planning and developing new programs in order to make this a smooth transition. (Goldsmith 2011)
Conclusion
We first need to fix our health care system. Citizens in most nations in the industrialized world have long enjoyed universal, stable and fully portable health insurance that is not lost with the job or in retirement. Not all of them use a single-payer approach to reach that goal. They use a variety of different approaches. But single payer systems have shown themselves to be effective in achieving universal access to health care without breaking either the nation’s treasury or those of individual households. We must come together as a country, distribute wealth more equability and the answer is Universal Health Coverage. As stated in the TV series on PBS “Sick around the World” per the World Health Organization the U.S. is 37th in the world as far as sickness yet all other countries spend a lot less and have much better health care coverage. It is also unheard of for a citizen to have Health Care Bankruptcy. (Palfreman 2008)
We must come together as a country. I am not an expert in health care, or Obamacare, or the Affordable Care Act, or whatever you choose to describe it, but I do know this: We are a wealthy enough country with the capacity to make sure that every one of our fellow citizens has access to quality health care. Let’s show the rest of the world what our democratic system is all about and how we take care of all of our citizens and provide them with the best health care system possible. I don’t see why we can’t do what Europe is doing, what Canada is doing, what Korea is doing, what all these other places are doing. The U.S. needs to focus on the best interest for all of the citizens of the United States of America and make a change for their health and wellbeing. (Cheng & Reinhardt et al. 2012)
References
Nader, Ralph. (2014). “Canadian health care better than Obamacare - 22 ways the
Canadian health-care system is better than Obamacare in the U.S.” [TheStar.com Commentary] Retrieved from http://www.thestar.com/opinion/commentary/2014/01/12/ canadian_health_care_better_than_obamacare.html.
Cheng, Tsung-Mei & Reinhardt, Ewe. (2012). “Perspective on the Role of the Private
Sector In Meeting Health Care Needs,” in Benedict Clements, David Cody and Sanjeev Gupta, eds. The Economics of Public Health Care Reform in Advanced and Emerging Economies. International Monetary Fund. Washington, DC. 69-98.
O’Neil, June E & O’Neil, David M.
(2007). The National Bureau of Economic Research
(NBER) Comparing the U.S. and Canadian Health Care Systems “Health Status, Health Care and Inequality: Canada vs. the U.S.” Retrieved From http://www.nber.org/bah/fall07/w13429.html.
Morra, D,; Nicholson, S. & Levinson, W et al. (2011). “U.S. Physician Practices
Spend Nearly Four Times as Much Money Interacting with Health Plans and Payers Than Do Their Canadian Counterparts.” Health Affairs. 1443-1450.
Aldeman, L. (Producer), & Poulain, R. (Director). (2008). Unnatural causes: In sickness and in wealth [Television series]. Boston, MA: PBS.
Palfreman, J. (Producer & Director). (2008). Sick around the World [Television series]. Boston, MA: PBS.
Goldsmith, S. B. (2011). Principles of health care management: Foundations for a changing
health care system (2nd ed.). Sudbury, MA: Jones and Bartlett Publishers.
Health Care System Comparisons – U.S. VS. Canada 13
Pozen, Alexis & Cutler, David. (2010). Medical Spending Differences in the United States and
Canada: The Role of Prices, Procedures, and Administrative Expenses, Inquiry 47(2),
124-34.
Appendix A
Mean Dollar Value of Hours Spent per Physician per Year on Administrative Costs
Turnitin – Originality Reports
I submitted my paper last week and I had 18% on the originality report and this week I had 53%. I am very impressed with Turnitin. It is very interesting to see how your paper compares and to see the sources they come from. I can definitely see how this will be useful throughout all of my classes to make sure I am citing correctly in regards to plagiarism and by using the tools for additional drafts.