5 February, 2023

Blog

The American Healthcare System; The World’s Best & Worst

By Kumar David

Prof. Kumar David

Remember Dickens? “It was the best of times; it was the worst of times. It was the age of wisdom; it was the age of foolishness”. America has the finest medical technology, its operating theatres are superb (when you walk past one it looks like a NASA space control centre), the surgeons, doctors, support staff (anaesthetists, nurses) and rooms and toilets are excellent. At the same time American healthcare is the most expensive, and the universal grouse is that hospitals and doctors earn more than justified.  

The diagram that I have displayed with this column shows the flow of funds in US healthcare. Households pay local State (say California) and Federal Income tax. The Federal Government (Washington) is the big paymaster into the healthcare system through what are known as Medicaid and Medicare payments to healthcare providers (hospitals for example) and top-up transfers to States.

Households, or companies on behalf of their employees, also take insurance policies because government Medicaid and Medicare is insufficient to pay for surgery, drugs and specialist fees. In the case of serious illness people may have to make out of pocket payments. I am not saying doctors knowingly cheat, overprescribe, make excessive consultation references to other doctors, or have deals with hospitals. The excesses are simply built into the way in which the system functions. Often the old and invariably the poor cannot afford payments and forego some services. Political pressures have brought about changes in recent decades. Now anyone can walk into a hospital in the US and cannot be denied emergency medical attention and provision of immediate medication – creeping social democracy you might say!

A recent book by Ed Down however asserts that “people must come to understand that the alleged healthcare providers are actually legal drug dealers who base their diagnosis and recommendations primarily on their profit potential. Not wilfully but at least that’s the model they have been taught and most follow”.

The countries with the eight highest per-capita annual healthcare costs in 2022 were as follows;

* United States – $12,300

* Germany- $7,400

* Switzerland – $7, 200

* Norway – $7,000

* Austria – $6,400

* Denmark – $6,400 

* Sweden – $6,300

* Netherlands – $6,200

All these including the US have an aging population and this pushes up per capita cost. All hire healthcare workers and professionals from other countries – the US from Mexico and the Philippines, Germany from Eastern Europe and the UK from Commonwealth and Eastern European countries. Still the nearly two-to-one cost ratio between the US and most others is difficult to explain except in terms of profiteering by hospitals and healthcare institutions and overcharging by doctors. Medical professionals and institutions take insurance against what is called malpractice where an accidental error may expose a professional or an institution to law suits of several millions of dollars. This adds a great deal to costs; America is a highly litigious society and there are law firms specialising in screwing doctors and hospitals.  

Comparison with the UK

The UK is where well to do Sri Lankans still seek treatment. Costs are lower and the National Health Service (NHS) provides a good service at a lower price than the US. In 2022 compared to the eight high spenders I listed previously, UK healthcare spending on the NHS came nineteenth – below $4500 per annum. The biggest complaint is that the waiting time for non-essential surgery is very long. My friend and late comrade Prof. Sivaguru Ganesan had a complex open-heart procedure five years ago in the UK and never stopped lauding the NUS. “If not for the NUS I would be long dead!” was his constant refrain.

I have quoted above the most expensive per capital health budgets in the world. The US healthcare price tag of over $4 trillion is 55 times Sri Lanka’s entire GDP at the current exchange rate. There are those who say that despite a comparatively tiny budget Ceylon/Sri Lanka has a healthcare system that caters well to the needs of the population, like our education system. I have heard this often from Prof. Carlo Fonseka. I think there is truth in this though conditions here have been sliding downhill steeply in the last two decades.

The following is a summary of a write up prepared for me by Velupillai Kuhanendran, a political comrade of Ganesan and mine and an activist in the Global Tamil Forum and the Labour Party. Sri Lanka/Ceylon is much influenced by the British model. Since the affluent classes still travel there for medical care I am quoting at length (three paragraphs).

QUOTE:

“The post-war Bevan model was for a population aged 20 -50 years and not 70 – 90. The pension industry too was based on this assumption. Medical technology was low and health services dealt with general problems and people were kept in hospital until they were discharged as fully fit. Open heart or major surgery was rare and cancer issues infrequent. The situation has changed dramatically. The population has aged; medical technology has advanced, people live beyond 80, it is common for a man to have two or more surgical interventions, cancer treatments is common, hip and knee replacements very common, the need for beds is high. The demand on the health services has increased exponentially but unlike the US investment and infrastructure have not kept pace.

“General medical services can deal with demands from day-patients but the system has not been modernised. Due to the economic austerity of the last 12 years the government did not invest in building hospitals so there is a massive shortage of beds. The government reaction has been to arrange social-care services but adequate funds are not allocated for these services either. Patients brought by ambulances were kept there till a bed could be found. Ambulances were used as substitute beds and prevented from performing their function. The government promised to fix it by allocating more funds but it did not.

“Though the UK has not invested in the NHS the lower and middle classes who are a majority of the population rely on it. The older population which is now numerically (electorally) significant depends on it. No government (Tory or Labour) has the backbone to run it down; no political party can afford to alienate it. The NHS is here to stay. No one dares to abandon it. More immigration of doctors and nurses is part of the solution. Private medicine is no match for the NHS”.

END OF QUOTE From Kuhanendran.

While the US healthcare system is the most advanced in the world it is also the most expensive. It is paid for by the American taxpayer, meaning by the Federal and State government budgets and by households via insurance companies. I think it is not unfair to say that the principal beneficiaries are the medical institutions (hospitals etc) and doctors and medical personnel. The burden is carried by households via Federal and State taxes and Medicare payments, and by employers both small and large via payments to private Health Insurance companies. It is an arrangement that fits nicely into the ideology and practices of American market capitalism. Though technically cutting-edge the US system is also the costliest. I think it is not unfair to say that the principal beneficiaries are the medical institutions (hospitals etc) and doctors and medical personnel. It is an arrangement that fits in with the ideology and practices of American market capitalism.

It will be challenged and overthrown as America moves in the direction of social democracy. It will be challenged and overthrown as America moves in the direction of social democracy. (Some things like the defacto joint Israeli-US occupation of Arab lands will not change). Biden’s four-trillion-dollar economic package is putting more money into the hands of consumers, for example there are two vacancies for every job seeker, and folks are on a spending spree, despite sustained inflation. The social and political complexities of this period overlap in ways not seen before in a century. Everything points in the direction of significant change in the days ahead. I will return to these themes in the weeks and months to come because America changes its mind rather rapidly

The graph below shows how many years it takes for America to change its mind;

[Note: I went into surgery for Gallbladder removal at Xmas time at Kaiser Permanente, probably the best integrated hospital-system-chain in California. This has given me insights to prepare this article]. 

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Latest comments

  • 3
    3

    “I am not saying doctors knowingly cheat, overprescribe, make excessive consultation references to other doctors, or have deals with hospitals.”
    You missed out on that they gang up against whistleblowers?
    Do you think that they do such things out of sheer gullibility?

    • 3
      3

      KD: Sri Lankan doctors too like their US counterparts are legal Drug dealers funded by Big Pharma and they have bankrupted the country and Health Sector with the Covid-19 PCR test and injections regime. That crook Asela Gunawardena is the worst scoundrel who bought and discarded 6 million Pfizer injections and should be tried in open court for destroying the Health system and economy of the country.
      Again there was a Data Game played with the Data wipe of the National Medicine’s Regulatory Authority (NMRA) data in the GOSL Cloud. This is like the Fake Debt Data numbers, (Sri Lanka’s external dollar denominated debt at the time of default was 26 billion and NOT 53 billion as now claimed), and the Climate catastrophe story that is being promoted to so Green Tech companies, electric cars, even Electric TUk-Tuks and Solar panel vendors, to benefit vested interests and the global Green tech Corporations which are mainly rebranded dirty oil companies… or like Bio warfare firm Moderna which as patents on SARS-COV 2 sequences, DARPA contractors!

      • 3
        3

        GSK funds the Sri Lanka Medical Association’s parties, Christmas Balls, overseas jaunts.. etc.and so too the GMOAs juants, and the Medical Technology outfits etc. Its a gravy train of Biotech and Big Pharma corruption.
        SL Doctors also over prescribe drugs and get paid by the agents of the drug companies all tracked though the drug sales Data systems with Big Data analytics..
        KD – Dr. Senaka Bibile was killed by Big Pharma while working for the WHO another Big Pharma outfit , just like Dinesh Shaffter was killed by CIA contract killers in the STF.. to protect BlackRock and the corrupt Euro-bond traders..

  • 3
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    Would the author care to compare US healthcare with that of Cuba?
    If COVID-19 mortality is a criterion, Nicaragua, Venezuela and Haiti are streets ahead of the USA.

  • 5
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    “Households, or companies on behalf of their employees, also take insurance policies because government Medicaid and Medicare is insufficient to pay for surgery, drugs and specialist fees.”

    Dr. KD,

    Actually, Medicare is only for people who are 65 or older. Until they reach that age, middle class people have to buy their own insurance. At the low end, a family of two with household income below something like $60K may be eligible for Medicaid.

    FYI, while Kaiser is a fairly good HMO, I wouldn’t call its hospitals the best in California. The hospitals affiliated with Stanford, UCSF, UCLA, USC, etc., are probably more advanced.

    • 1
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      The state even promotes killer vaccines to look after Big pharma.
      There is so much care that people are overwhelmed and die of heart problems.

  • 6
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    “I went into surgery for Gallbladder removal at Xmas time at Kaiser Permanente, probably the best integrated hospital-system-chain in California.”

    Why is that, the good ol’ Uncle Sam: The USA – their Satan – is the Mecca for all Commies? …… Mecca for Moderns?

    Congratulations Prof David, you have made your pilgrimage to the Commie Holy Land ……… you have completed your Hajj. :))

    • 6
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      My father is a lapsed Commie …… this is a piece I wrote about his acquaintances ……… in Dayan’s piece in appreciation of Fidel. https://www.colombotelegraph.com/index.php/a-farewell-to-fidel-the-last-of-the-epic-heroes/comment-page-1/#comments

      What baffles me is that, when I was a kid I used to know fire-breathing Commies who even went to the extent of changing their appearance to look like Che or many other heroes of the left. In fact I knew a guy who made himself into a splitting image of Trotsky. But when the Soviet Union/West/Eastern Europe/Whites lost interest in Socialism/Communism as if on cue the SL fire-breathers lost interest as well. So I wonder if these jokers were genuine or were they just mimicking the Whites, one the colonial masters and the others revolutionaries of the left, nevertheless all mimicking whites in the end.

      If Communism is/was so good, what happened to the old fervour? Was it just a passing fad like a Beatles’ haircut?

      All the lefties I used to know ended up not in Russia or Cuba but of all places the good old US of A. The SL Trotsky now is an ardent capitalist, drives a Ferrari in LA. Such is life.

      • 7
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        continued

        All the Lankan Leftists are/were humbugs. All what happened with N M, Colvin, Kenaman …. et al was that the privileged class came forward calling themselves “The Left” and stymied the real down-trodden class from rising up.

        There were not many Lankans more privileged than N M, Colvin, Kenaman ………. but the trick they played on the real down-trodden gave/bought them more time to enjoy their privileges. When a group of people call themselves “the Left” there is no room for another left to rise up.

        The JVP insurrection was the instance where the real Lankan down-trodden rose up. This is not to say the JVP was right/wrong, that’s another shindig and left for others to decide.

        In the end all are self-centred selfish bastards. We just get carried away with this hero-worship business.

        We all need someone to worship. I might as well worship Marilyn Monroe.

        • 6
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          Dear Nimal, thanks, I can’t say any better about Lankan communist, than what you typed here. KD, has presented just one side of the story (looking from the consumer side ). I worked in the U.S for more than 15 years and now away for 10 years. During this time the income of a doctor has gone up slightly high, keeping with the inflation. Where as health cost has shot up, in many folds. I am not here to discuss the reasons which are endless. Has anyone compared the income of a Lawyer or an accountant to say Doctors are making unreasonable money ?? Also people need to remember during Covid, it’s those doctors and others in medical field,who sacrificed their lives in saving people. (definitely not the retired professors). KD, is smart unlike his peers, not to go to Cuba, Venezuela, Haiti for his surgery.

      • 0
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        Nimal,
        “But when the Soviet Union/West/Eastern Europe/Whites lost interest in Socialism/Communism as if on cue the SL fire-breathers lost interest as well. So I wonder if these jokers were genuine or were they just mimicking the Whites,”
        I think they were quite genuine, just as Sinhala Buddhists take their ideology seriously.
        There was an apparently well functioning model, there was no internet, they gave us (slightly outdated) freebies, we could see them at work in Somalia and Afghanistan (both respectable countries then). Australia still insisted on European descent for immigrants. The US, having used more bombs than in WW2, got a licking in Vietnam. So which side would you pick?
        I am waiting for the Sinhala Buddhist Gorbachev.

  • 0
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    NF, Chiv,

    From other articles and comments on CT, I think Dr.KD moved to California several months ago to live with his son or stepson. I am sure he didn’t come all the way from SL just for this surgery.

    • 0
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      Agnos, thanks, I am aware of it. That is one reason, I am surprised with him presenting merely on consumer point of view. Nimal, recently I read an article on Hui KaYan, Chairman of Evergrande group who’s wealth dropped from USD 43 Billion to USD 3 Billion. (more than 90 %) . Once the second richest person in Asia, had been part of political advisory body since 2008 and of it’s elite 300 member standing committee since 2013. He financed CPPCC, party, politicians including Xi for decades. Now that he is not wealthy or elite to finance Xi, he was told not to attend the convention, last year as his property empire became the biggest casualty of the nation’s credit crunch. Now He is not even included on the latest list of those who’ll form the CPPCC for the next five years, which was released few days ago. “The CPPCC is a honorary reward given to faithful business people to make contributions to politician / party” ( read financing, bribes, oiling palms) said Willy Lam, an Adjunct Professor at Chinese Uni of HK , who has authored several books on Chinese politics. Not only Hui, but Hui Wing Mau (Shimao group), Zhang Li ( Guangzhou RF properties), Hoi Kin Hong ( Powerlong real estates) are no longer part of CPPCC anymore.

      • 5
        0

        chiv,

        There is corruption everywhere. In my college days there was a story going around ……… in army procumbents they were paying $50,000 for each hammer calling them repeat-impacters. Don’t think anyone was caught or punished.

        As you say, there’s all sorts of chicanery going on in China ……. but their leaders didn’t bankrupt the country, they have made tremendous advancements in such a short period of time. I think Xi is an narcissistic power-hungry calm-faced maniac …… I don’t know what he has done for China’s advancement: perhaps just reaping the benefit of all the hard work of his predecessors

        But the volatility in the markets is a good time to make some dosh …….. some of their companies have so much money in their kitties it’s hard for them to go broke. BABA was below 65 in October …. META went below 90 ….. now above 140 in a few weeks. I buy when they go low on bad-news and sell when they recover …….. repeated a few times.

    • 4
      0

      Agnos,

      I was just pulling the Prof’s leg ……. I don’t know much about people here other than what’s written here. I understand he was a prof at Peradeniya. I appreciate people who could’ve easily left with their education/skills but stayed behind, I’ve said it before. At least he is true to that part of his Marxist faith. ……… Now, he deserves all the decadence America has to offer. :))

      I know a Commie who ended up in Las Vegas ……. he’s still keeping the faith: hasn’t sold-out. Says he wants to convert Las Vegas showgirls to the communist way of life. ………. Hope Prof David can find such a mission. :))

      • 0
        0

        Nimal
        “he’s still keeping the faith: hasn’t sold-out. Says he wants to convert Las Vegas showgirls to the communist way of life. “
        As long as they don’t look like those East German athletes, of course.

    • 0
      0

      A
      Prof. KD moved out of Sri Lanka four decades ago. He maintained contact, mostly political for a long time.
      I cannot see what importance gossip about his personal life is to these pages, unless a story has some major social implication.

      • 2
        0

        SJ,

        Dr.KD has written about his family in his articles. And that he was already in California is important because a gall bladder surgery is a relatively minor surgery that can be done well even in SL or India or Singapore.

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