Less is more

24 September 2004 By Edward Hadas Follow @edwardhadas

They argue about how much more to spend, but the US already has lots of health care. In international terms, the country gets a bad deal. The government could do a lot to help. But neither candidate has the courage to suggest that less could be more. They argue about how much more to spend, but the US already spends too much on health care. The system needs a big shake up.

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The US spends $1.7 trillion on health care, 14.6% of GDP, according to the OECD. If US the 15% of the population without health insurance spent as much as the insured, the ratio would rise by 0.4%, following calculations suggested by an Institute of Medicine study. Switzerland, the next most health careintensive economy, spends 11.2% of GDP. The ratio for Germany is 10.9%, for France 9.7%, for Canada 9.6%, for Italy 8.5%, for Japan 7.8% and for the UK 7.7%.

Life expectancy for women at birth in the US is 79.8 years, according to the OECD. That compares to an average of 82.5 for the other G7 countries. At age 65, the life expectancy for men in the US is 15.4 years. The average for the other G7 countries is 16.5 years. The gaps for the other sex are similar.

The health care plans of George W Bush are centred on tax benefits – various sorts of tax preferred Health Savings Accounts and deductions for health insurance premiums. He also calls for modest expansions of Medicare, the health insurance programme for old people. Proposed cost savings include limits on lawsuits and improved use of information technology.

John Kerry proposes a significant expansion of government health insurance to poor families and the direct government payment of high cost cases that are currently insured privately. He also proposes a series of increased tax credits for health insurance. Proposed cost savings include limits on lawsuits and improved use of information technology.

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