Fun Facts on Medical Spending & Debt Crisis

“What gets us into trouble is not what we don’t know, it’s what we know for sure that just ain’t so.”
-Mark Twain

~~~

“If you are among those who believe that the U.S. has the best healthcare system in the world — despite overwhelming evidence to the contrary — it’s because my fellow spinmeisters and I succeeded brilliantly at what we were paid very well to do with your premium dollars.”
Wendell Potter a former Vice President of Corporate Communications (aka Public Relations) at a major Healthcare Company

I have always despised the morning buffoons as a waste of time.  So even back in 1998, driving to a Control Systems Engineering job in Houston I popped lecture Number Five of Thirty-six of Professor Timothy Taylor’s “Contemporary Economic Issues” and began to listen to his “Financing Healthcare” lecture. He was going on about how garbled the Hillary-care plan was. No surprise there. But then he switched to international comparisons saying the American cost per person was almost double the U.K.’s cost per person.  And that they had some harsh rules but still generally the same quality as we had in America. What – we pay almost double WTF is this guy talking about – that can’t be right. And everyone knows we are the best… I shook it off as he went on that Germany’ health-care plan was a bit more expensive than the U.K. but was a better fit for America and would still give us a 40% savings if we cloned their healthcare system. I pulled into work
confused and more than a bit skeptical. I was determined to get book of notes and references out and discredit this nonsense as soon as I got home that evening.

That was thirteen years ago. I never discredited Professor Taylor’s insights. Rather I have watched the situation deteriorate further while Michael Moore’s mostly correct “Sicko” was easily discredited by his over stating and glorification of Castro’s Cuban Healthcare plan. If Moore wanted to rub America’s face in its Healthcare mess couldn’t he have picked France where they really do have a well run healthcare plan? And to watch smooth Femme fatale Karen Ignagni, CEO of America’s leading healthcare lobbyist, America’s Health Insurance Plans (AHIP), play Obama for the fool while she receives a $1,800,000 salary out of our premiums was a disgusting spectacle. (See the Potter book below for fact checking and discrediting “Sicko” and a grudgingly admiring portrait of Ignagani whom he worked closely with.)

During the great healthcare debate I had business in Europe and could not resist staying extra for some rest and relaxation. According to friends in the U.K. they have improved the system since those days back in 1998, kept the cost down and are dabbling with adding incentives. While we have a food fight, the Netherlands (where doctor’s make house calls) was completely revamping its top shelf healthcare system. Rather than crow about their excellent system they still are dissatisfied and trying to improve. In Germany, where I was a customer inspecting some complex equipment for a client, I tried to ask about healthcare. On my final day there after some wine at lunch and some prodding and assurances I wouldn’t bite their heads off they told me in so many words they considered our debate unintelligible. I then retreated to Rome where I forgot work and healthcare in a haze of “Dolce far niente” the sweetness of doing nothing.

So here we are with a Deficit and Debt Pissing Contest going on in Washington. Let’s show these fools how America’s money problem could essentially be solved with healthcare alone by copying – pick your country’s plan.

It has been documented (references below) many times that America spends about $3,500 more per person per year more than the UK, Germany, Italy, France, Spain, Japan, Sweden, Norway, Australia etc.  And all of these countries have greater longevity, all have less infant mortality, all have universal coverage and all except Japan have immigration problems.

So we have the amount we would save $3,500 per person per year. Now we need the population of America which is over 330,000,000 people.

OK let’s see multiply our savings, the extra we pay per person per year by the total number of people to get our total savings for the nation.

330,000,000 [people in USA]
x $3,500 [savings per person per year]
————————————————————-
$1,115,000,000,000 [Total Savings for USA per year]

That is over $1.1 Trillion Dollars per year in extra spending that could be saved!

Wow. We just solved the Nation’s Debt Crisis. Congratulations!

(Of course we would crash the healthcare and related stocks. Lets see a handfull of stocks versus America – obviously the stocks win. I can probably continue to hold on to my tiny long ETF positions in IBB and PSCH for a while. What are the odds?)

– – – – – – – – – – – – – – – – – – – – – – – –
REFERENCES
“Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR Is Killing Health Care and Deceiving Americans” by Wendell Potter
www.amazon.com/Deadly-Spin-Insurance-Corporate-Deceiving/dp/1608192814/ref=sr_1_1?ie=UTF8&qid=1307922223&sr=8-1<http://www.amazon.com/Deadly-Spin-Insurance-Corporate-Deceiving/dp/1608192814/ref=sr_1_1?ie=UTF8&qid=1307922223&sr=8-1>

Kleiner Perkins Caufield & Byers / Business Week Study Americ-Inc 2/2011
www.kpcb.com/usainc/<http://www.kpcb.com/usainc/>
www.kpcb.com/usainc/USA_Inc.pdf<http://www.kpcb.com/usainc/USA_Inc.pdf>
Check out the fun charts on pdf pages 107(72) to 111(74)

For a different independent comparison featured in Barry Ritholtz’ “The Big Picture” blog see the fun charts from the Medicalbillingandcoding.org
at
www.medicalbillingandcoding.org/medical-costs-1/<http://www.medicalbillingandcoding.org/medical-costs-1/>
and
www.medicalbillingandcoding.org/medicals-costs-2/<http://www.medicalbillingandcoding.org/medicals-costs-2/>

The American organization that has done the most work on international comparative Health Care is The Commonwealth Fund
www.commonwealthfund.org/Topics/International-Health-Policy.aspx<http://www.commonwealthfund.org/Topics/International-Health-Policy.aspx>
You can get lost in that web site for days on end reviewing statistics from the US and other countries.

Also important is The Kaiser Family Foundation www.kff.org/<http://www.kff.org/> They keep incredibly detailed library of a wide variety of American health statistics including state by state analysis.

Economics Professor Timothy Taylor’s 1998 “Contemporary Economic Issues”
was retired years ago other courses are available at www.thegreatcourses.com but to my knowledge none contain international healthcare comparisons.

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