Crunching Numbers for Healthcare

We've had plenty of healthcare debates on this forum but I just came upon real life numbers on healthcare costs which I thought I'd just crank out for people in America.

Canada

Coverage Plan:

• Basics 100% covered

Cost: $2200 on average per capita in tax dollars

Extra Coverage Plan:

• Massage/Acupuncture etc, $500/year
• Pharmaceuticals 100% covered
• Dental 100% covered (Orthodontics 50% covered, max of $1500)
• Vision care, every 12 months (when combined with government plan) and up to $400 for glass/frames

Cost: ~$1500 a year for an entire family

United States

Coverage Plan:

• Basics 100% on routine things, around 10% of cost copay (max out of pocket charge of $1000)
• Massage/Acupuncture etc, 0-10% copay, up to $450
• Pharmaceuticals, $10-$40 copay
• Dental 100% covered (Orthodontics 50% covered, max of $1500)
• Vision care, every 12 months ($10 copay) and up to $130 for glass/frames

Cost: Govenrment pays around $2200 per capita, this plan costs $20500 ($4100 out of pocket, 80% subsidized by company)

(Adding in the post from Ian Ex Machina)

Britain

Coverage is 100% of everything excluding:

Prescriptions which are £7.40 per prescription. (Free in Wales, Scotland and NI. Also free if you are unemployed, over 60, under 16, 16-18 and in full time education, are pregnant or have been in the last year, an inpatient or have certain disabilities or medical conditions. You may also receive financial help paying if you are low income.)

Dentistry which is:

• £17 for basic stuff (examinations, x rays, scale + polish, fissure sealant.)
• £47 for more advanced stuff (fillings, root canal work or if your dentist needs to take out one or more of your teeth.)
• £204 which covers everything listed above, plus crowns, dentures and bridges.

Again you can get it free if you fall into many of the same categories used for free prescriptions.

(Edit: Caissas Death Angel indicates that Vision care is 100% covered by NHS now)

• Vision care: 100% covered

• Cosmetic surgery. Not done through the NHS. (Different to Plastic Surgery which is down through the NHS as 'Plastic surgery is carried out for reconstructive purposes rather than for cosmetic reasons.')

(According to http://news.bbc.co.uk/2/hi/health/1764713.stm the cost per capita is £1,230)

Cost: £1, 230 ($1907 USD)

Therefore, I would get superior coverage in Canada paying roughly (assuming a family of 3) $8100 for a family. Or I could get inferior coverage in the United States for the cost of $27100 for a family of 3.

Not to mention the cost to the corporation paying $16400 for an employee's medical coverage, versus $1500 for a Canadian business.

Summary (Family of Three)

• Canada: $8100
• United States: $27 100
• UK: $5720

edited 20th Jan '12 3:47:32 PM by breadloaf

The numbers are certainly interesting, but do you have a source?

For the Canadian healthcare plans, it is OHIP (Ontario's provincial coverage plan) combined with Great West Life.

For the US healthcare plan, it is a real work medical insurance plan at a top company that is a combo of (Anthem Blue Cross HMO/Anthem Blue Cross PPO/Kaiser Permanente HMO) + (Guardian DPO) + (VSP).

Average government cost comes from statistics agencies (the same numbers seem to come out roughly the same between what the respective governments say and OECD etc).

Both plan combos are from "top" companies in both Canada and USA. As an additional note, there is zero you pay out of pocket for the Canadian plan, and on top of the copay for the US plan, you also pay $4100/year out of pocket.

edited 20th Jan '12 9:09:00 AM by breadloaf

Britain

Coverage is 100% of everything excluding:

• Prescriptions which are £7.40 per prescription. (Free in Wales, Scotland and NI. Also free if you are unemployed, over 60, under 16, 16-18 and in full time education, are pregnant or have been in the last year, an inpatient or have certain disabilities or medical conditions. You may also receive financial help paying if you are low income.)
• Dentistry which is:
  • £17 for basic stuff (examinations, x rays, scale + polish, fissure sealant.)
  • £47 for more advanced stuff (fillings, root canal work or if your dentist needs to take out one or more of your teeth.)
  • £204 which covers everything listed above, plus crowns, dentures and bridges.
    • Again you can get it free if you fall into many of the same categories used for free prescriptions.
• Vision care. Costs vary as eye tests are private. You can get free eye tests if you fall into certain categories (similar to the ones listed before). If you are low income or fall into other categories you can get subsidised for the cost of your glasses.
• Cosmetic surgery. Not done through the NHS. (Different to Plastic Surgery which is down through the NHS as 'Plastic surgery is carried out for reconstructive purposes rather than for cosmetic reasons.')

Cost for the family depends on the earnings as it is tax based.
A rough example I've found:

If you earn £30k (the actual amount taxed would be £22k) the total of taxes are about 25% (NI, Income tax etc). Healthcare takes up around 17.7% of that. Therefore health costs people of the UK 4.5% of income or about £1,330.

(Those on a higher income would be taxed more depending on their tax bracket.)

Sources:
Costs of stuff like prescription, eye care etc. NHS spending amount. UK taxes.

edited 20th Jan '12 11:01:08 AM by IanExMachina

I added in your post.

On a side note, does the NHS also usually get combined with someone's medical insurance provided by their workplace? I would combine in that cost and coverage as well to help make the comparison, considering that my other cost summaries include private costs.

Usually, workplaces don't offer health coverage (why should you fork out money for something the state already provides?).

One can get private health care, but most don't usually bother, unless you can actually afford.

Well Canada has no dental/pharma and limited eye care under provincial plans, so I was wondering if anybody supplements the dental/pharma/eye in UK so that the person pays zero pounds.

Mind you, in Canada, small businesses tend to want you to pay out of pocket for the subsidized medical insurance plans, but as I said, the cost is like $1500 per year so it's not super terrible (and it's for the extras and not the basics).

World Health Organisation report of health expenditures by country by several metrics (per capita, %GDP etc).: http://www.who.int/whosis/whostat/EN_WHS09_Table7.pdf

Well according to that:

• Canada: 3673 USD per capita
• USA: 6719 USD per capita
• UK: 3332 USD per capita

I think the on-average cost is misleading when you don't actually look at the real coverage you get out of these plans. Just because a person is "insured" is not the same as another insurance plan. So I think people vastly underestimate the actual cost of American healthcare. It's not just some averaged out cost... like the combo-health plan I posted that doesn't even compare to the Canadian one costs nearly 4x as much.

Slight inaccuracy for Britain - all eye tests are now 100% government funded (private companies do it, but I assume that they claim the costs back from the NHS). Doesn't matter who you are.

Alright I edited that information, do you have specifics on how much you get? What is the amount of money for prescription glasses/frames and the frequency of eye examinations?

Not quite sure of the cost for glasses, but like with other things, one can get an eye exam as many times as one wants, in effect. The Department for Health recommends bi-annually or something.

Yep, for eye examinations it's not a fixed amount you get your anything. You just book yourself in and it happens, without any reference being made to charges or costs unless you don't realise it's free and thus have no excuse not to do so. How often you should get one depends on your prescription, but generally, as said above, bi-annually. If you've just had some sort of eye-related illness or are doing something like changing to contact lenses, it might be more frequent.

Since they get their costs back anyway, the companies lose nothing by getting you in. It's pretty recent though (last two or three years?).

Well if it weren't for Harper, they were thinking of putting in preventative care and pharmaceutical coverage to lower healthcare costs.

Pity they didn't - it's just plain common sense that prevention is better in every single way than cure.

It's how Cuba manages better health metrics than USA. Cuba's problem is lack of any treatment capability, while Canada/USA have plenty of treatment options (one might argue that USA has better treatment options, just that nobody can afford them except the top 1%).

I forget what they say, but there's always greater dollars saved than dollars spent for preventative care. Something as simple as spending money on more doctors to do house visits annually can save you 3-5x the money you spent on doing so.

Not to mention, it's far easier, less painful, traumatic and time consuming to deal with something in the early stages - particularly the bigger ones like cancer - before it gets serious.

Yeah it is. A biopsy in the USA costs 50-80k, and then treatment can cost like a quarter million or more. I have no idea how Americans are supposed to deal with costs like that but I suppose that's why they suffer bankruptcies to health issues so often.

However, breast cancer examinations were apparently too much of a good thing in Canada, where the rate of false positives caused undue stress and cost. So the various medical bodies are suggesting now that we tone down how many we do (such as starting it at a later age and doing it less often and only do deeper examinations if you actually notice something like a mole).

And... I just saw this really unfortunate story in the news: http://www.cbc.ca/news/canada/british-columbia/story/2012/01/20/bc-sarah-burke-medical-fees.html

Basically, a Canadian skiier in the US died due to injuries sustained during training. After two weeks in the hospital she died. Then the family was stuck with a half million dollar bill.

edited 20th Jan '12 8:55:52 PM by breadloaf

It's really a case that health care costs are ~30% corporate overhead (paying CEO's, boards of directors, etc.), marketing, and profit by the insurance companies. This is compared to something around 2.5% for Medicare (government-provided health insurance, only available to those 65+) [citation needed, anyone care to help?].

Taking this out, as well as maybe 5% more to cover the non-uniformity of reimbursement paperwork, etc., and that 6,700 per capita becomes closer to 4,500.

Another benefit of UHC - marketing and profit don't exist. Well okay, advertising does exist so that people know what services are on offer, but that's not quite the same as "here's our practice, we're selling you our HC services". Those are big costs negated right there.

Another thing I noticed is that you don't get to appreciate what you have with UHC until you don't have it (ie. visit another country). It's pretty screwed up in private healthcare countries where doctors are busy selling you items and writing all sorts of prescriptions instead of trying to heal you in the best manner possible (which is probably also the cheapest manner possible).

Additionally, the "per capita" cost in private healthcare countries ignore the inferior healthcare you receive for that far greater dollar amount. For instance, do you get 100% dental coverage? Most plans require some form of copay.

And, for the US plan I put up to be equivalent to the Canadian plan, it's a combination of 4 different healthcare insurance providers (one of which is a choice between 3 different possible main plans, so you're choosing 4 of 7 plans), versus a government plan + one extra private plan. The headache of choosing a plan by itself is already a major loss of productivity. People complain about lost manhours due to filing taxes, how about choosing your healthcare plan?

I mean, when you compare actual plans, instead of crunching "per capita" costs, suddenly we can see that Americans pay an extremely high amount that is 4x as much.

Also, if we were to compare state spending upon healthcare we would find that the US pays nearly 18% of GDP towards healthcare, whereas Britain pays roughly 10%. Granted, the fact that the US government spends more is due to a larger population than the UK, but it doesn't explain how there are nearly 40mn Americans without care.

Also, as stated, a benefit of UHC is that there are no marketing costs, and they are a lot more patient-centric. Without the profit motive, the system only needs to focus upon getting people better. Indeed, most hospitals in Britain aren't exactly in much debt either, so we must be doing something right.

Also, as it is state-funded, it has much more resources at its disposal than a free market system. And if there is a treatment that a large group of people want, all they need to do is pester the Department for Health, and they usually succumb. Whereas in a free market system, it would take ages to lobby all the health companies to have that treatment.

Exactly.

In UHC or other nonprofit systems, you see a lot more preventative care and early-stage intervention since it saves money in the long run, and there's more incentive for curative procedures. When it's for-profit, doctors and hospitals want to do more late-stage, treatment procedures since they get to bill the insurance companies more, which drives the costs up for everyone. In addition, it encourages symptomatic treatment over long-term, permanent cures because they can bill over time.

I firmly believe that, along with schools (at least primary/secondary), prisons, and the military, that healthcare is one of the four things that is immoral to run for-profit.

Now, obviously, UHC (or at least, the NHS) is not all hunky-dory. We have long waits for certain things, and there are some things that the NHS can't cover because they can't do it.

However, I have to say, that is a small price to pay for 100% coverage, patient-centric care, well-trained doctors and nurses, and the majority of treatments, and the fact that I only have to fill in three pieces of paperwork during a hospital stay, one of which is the menu.