After countless attempts over nearly a century, the US House of Representatives made history by approving a sweeping healthcare reform Bill on 7 November, backing the biggest health policy changes in four decades and handing US President Barack Obama a crucial victory. The battle over healthcare now moves to the US Senate.
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The US is one of the most technologically advanced countries in medicine and research. Yet, it has the highest cost of healthcare in the world ($8,160 per person annually), and is ranked 37th in the world in overall healthcare.
In 2009, 16% of Americans are uninsured; as the unemployment rate rises, the number of uninsured rises as well. Many employers have drastically reduced their healthcare plans for employees. Only 60% of employers are providing health benefits for full-time employees. So what is the best option for providing effective health insurances to all US citizens? And how does the public option—where the state pays for all the uninsured—fare in the analysis?
A comparison study of the US and seven other countries, both developing and developed, found that the US is the only country without a public option. The study conducted by the Social Systems Research Institute in Michigan, US, compared the average cost of healthcare per person; average life expectancy, infant mortality rate, HIV/AIDS prevalence rate, and availability of public and/or private health insurance options. Switzerland spends $3,857 per person per year; with Canada spending $3,678 per person; England, $1,675; Mexico, $800; and India, $9.20 each year; compared with $8,160 in the US. The US average life expectancy is 78.11 years, coming in third lowest among the countries studied, just above Mexico and India (see Table).
One of the wealthiest countries in the world, the US also reports the third highest infant mortality rate at 6.3 deaths per 1,000 live births, and the highest HIV/AIDS prevalence rate (0.60%). Yet, the patient-doctor ratio in the US is 390:1, compared with 470:1 in Canada, 440:1 in England and 1,700:1 in India.
Considering these findings, the US fares poorly overall on these parameters. One primary reason for the overall US healthcare system’s low ranking is that Americans do not want or cannot share the costs of medical treatment.
Like in several countries, many people deliberately choose not to receive treatment, either from a physician or emergency care, or purchase prescription medication because they cannot afford it. A large US population is lacking medical education in sexually transmitted diseases, diabetes, heart disease and other life-threatening illnesses. Many patients affected by these illnesses often try to manage their healthcare themselves, potentially leading to health complications or even death. For these reasons and many others, a public option seems viable for the US.
Obama’s recommended public option, known as the Federal Employees Health Benefits Program, will require $10 billion over the next five years to implement. It is estimated that this will drive costs down by nearly $77 billion by 2015. It will become a national health insurance exchange for those who don’t have insurance, a one-stop shopping market for healthcare. Any private insurance company could offer a plan in the exchange if it adheres to defined standards.
The exchange is sure to affect the health industry, by actually causing fierce competition among health insurance providers. As a government-run insurance plan, the exchange won’t have to make a profit or pay a chief executive’s salary. It will also have lower administrative costs: Currently, administrative costs in private insurance are at least twice those in the programmes run by the US government.
The exchange would also offer incentives for quality and use its bargaining power to achieve lower costs. As a result, savings would be passed on as lower premiums, forcing private insurance companies to compete on those terms or lose customers.
Let’s compare with India, which has a wide variety of socioeconomic settings, and where national health programmes have been designed with enough flexibility to permit state public health administrators to craft their own packages according to their needs.
The revised objective of India’s National Health Policy (NHP), instituted in 2002, is to achieve an acceptable standard of good health among the general population of the country by 2015.
NHP suggests that the Indian Systems of Medicine and Homoeopathy (ISMH) are necessary to initiate measures to enable each system of medicine to develop in accordance with its own genius. Simultaneously, NHP suggests that planned efforts should be made to integrate their services, especially the meaningful, phased integration of ISMH with modern medicine. NHP also outlines the need to secure complete integration of all plans for health and human development, particularly agriculture and food products, rural development, education and social welfare, housing, and water supply and sanitation.
In many places, ISMH continue to be widely used due to their accessibility and, sometimes, because they offer the only kind of medicine within the physical and financial reach of the patient. Such a typically Indian system of medicine is also embedded in the beliefs of a wide section of the public.
So, what can the US learn from India’s NHP? The US should adapt the systemic integration programme that India is implementing. This would integrate current medicinal research and technology.
Currently, variations in the public option are being debated in the US. Regardless of the type, a public option is better than no public option at all. Once implemented, it could reduce annual individual healthcare by as much as $2,500 a year. It is time for the US to choose well on behalf of its citizens and their health.
Graphics by Ahmed Raza Khan / Mint
Madhukar Angur is a distinguished professor of marketing, Flint School of Management, University of Michigan and honorary dean, Alliance Business School, Bangalore. Comments are welcome at email@example.com