Doctors salaries contribute to high U.S. healthcare costs

Doctors salaries contribute to high U.S. healthcare costs

They found that spending in the USA far outpaces that in other nations.

Administrative costs (related to planning, regulating, and managing) made up 8 percent of total healthcare spending in the US while the other countries were in the 1 to 3 percent range.

While it's been said that Americans use more medical services than peer countries, leading to higher costs, the study found salaries of physicians, as well as higher pharmaceutical prices play a significant roles in health care costs. Other countries' spending ranged from a low of 9.6 percent of GDP in Australia to a high of 12.4 percent of GDP in Switzerland. "These data suggest that numerous policy efforts in the USA have not been truly evidence-based".

In 2016, the USA spent 17.8 percent of its gross domestic product (GDP) on healthcare.

The study, conducted by researchers at Harvard University, debunks numerous common beliefs people have about why the United States spend so much money on healthcare.

The results suggest that people looking to lower USA health care spending should look beyond factors commonly blamed for the imbalance - such as utilization of the medical system - when searching for solutions, the researchers write in the paper. But a new study that looks at the main drivers of healthcare costs finds that common explanations for healthcare spending may be wrong.

While the country showed the highest spending, the US scored lowest among all the countries in terms of life expectancy at 78.8 years.

Despite beliefs to the contrary, "the United States has lower rates of physician visits and days spent in the hospital than other nations", said the report. The other countries ranged from 80.7-83.9 years.

Belief: The U.S. has too many specialists and not enough primary care physicians.

The United States used more imaging scans than most countries, but spent much less on inpatient hospital care.

'We already knew the United States spends more on health care than other high income countries, ' Dr Jha told Daily Mail Online.


Belief: The U.S. spends too little on social services and this may contribute to higher health care costs among certain populations.

'While the USA does spend a bit less on social services, it is not an outlier, spending more than countries like Canada, ' Dr Jha said.

A large part of this was administrative costs, which accounted for 8 percent of GDP in the USA, more than double the average of 3 percent of GDP.

America has "the best outcomes for those who have heart attacks or strokes, but is below average for avoidable hospitalizations for patients with diabetes and asthma", said the report.

Instead, high prices for labor and goods, including drugs, procedures and administrative services, seemed to be the major reasons, according to the analysis.

The US also pays higher salaries for nurses and physicians (on average).

Per capita spending for prescription drugs in other nations ranged from $466 to $939.

If the US did less imaging and fewer of 25 common procedures, and lowered prices and the number of procedures to levels in the Netherlands, it would translate into a savings of $137 billion, Dr. Ezekiel Emanuel of the Perelman School of Medicine at the University of Pennsylvania writes in an accompanying editorial.

"As the USA continues to struggle with high health care spending, it is critical that we make progress on curtailing these costs".

"As the USA continues to struggle with high healthcare spending, it is critical that we make progress on curtailing these costs", said first author Irene Papanicolas, visiting assistant professor in the Department of Health Policy and Management at Harvard.

The study was actually conducted by the London School of Economics, the Harvard TH Chan School of Public Health and the Harvard Global Health Institute.

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