is positively correlated with income. Asincomes rise, people want more of that good.Because we are a wealthy nation, we can anddo demand more health care.
But because of the way health care costsare distributed, they have become an increas-ing burden on consumers and businessesalike. On average, health insurance now costs$4,479 for an individual and $12,106 for a family per year. Health insurance premiumsrose by a little more than 6 percent in 2007,faster on average than wages.
Moreover, government health care pro-grams, particularly Medicare and Medicaid, arepiling up enormous burdens of debt for futuregenerations. Medicare’s unfunded liabilitiesnow top $50 trillion. Unchecked, Medicaidspending will increase fourfold as a percentageof federal outlays over the next century.
At the same time, too many Americansremain uninsured. Although the number of uninsured Americans is often exaggerated by critics of the system, approximately 47 million Americans are without health insurance at any given time.
Many are already eligible for gov-ernment programs; many are young andhealthy; many are uninsured for only a shorttime.
Yet there is no denying that a lack of insurance can pose a hardship for many Americans.
Finally, although the U.S. health care systemcan provide the world’s highest quality of care,that quality is often uneven. The Institute of Medicine estimates that some 44,000–90,000annual deaths are due to medical errors,
whilea study in
The New England Journal of Medicine
suggests that only a little more than half of American hospital patients receive the clinicalstandard of care.
Similarly, a RAND Corpora-tion study found serious gaps in the quality of care received by American children.
Many critics of U.S. health care suggest thatthe answers to these problems lie in a single-payer, national health care system.
Undersuch a system, health care would be financedthrough taxes rather than consumer paymentsor private insurance. Direct charges to patientswould be prohibited or severely restricted.Private insurance, if allowed at all, would belimited to a few supplemental services not cov-ered by the government plan. The governmentwould control costs by setting an overallnational health care budget and reimburse-ment levels.However, a closer look at countries withnational health care systems shows that thosecountries have serious problems of their own,including rising costs, rationing of care, lack of access to modern medical technology, andpoor health outcomes. Countries whosenational health systems avoid the worst of these problems are successful precisely becausethey incorporate market mechanisms andreject centralized government control. In otherwords, socialized medicine works—as long as itisn’t socialized medicine.
Measuring the Quality of Health Care acrossCountries
Numerous studies have attempted tocompare the quality of health care systems.In most of these surveys, the United Statesfares poorly, finishing well behind otherindustrialized countries. This has led criticsof the U.S. health care system to suggest that Americans pay more for health care butreceive less.There are several reasons to be skeptical of these rankings. First, many choose areas of comparison based on the results they wish toachieve, or according to the values of the com-parer. For example,
cites a 2000 WorldHealth Organization study that ranks the U.S.health care system 37th in the world, “slightly better than Slovenia.”
(See Table 1.)This study bases its conclusions on suchhighly subjective measures as “fairness” andcriteria that are not strictly related to a coun-try’s health care system, such as “tobacco con-trol.” For example, the WHO report penalizesthe United States for not having a sufficiently progressive tax system, not providing all citi-zens with health insurance, and having a gen-eral paucity of social welfare programs. Indeed,much of the poor performance of the United
A closer look atcountries withnational healthcare systemsshows that thosecountries haveserious problemsof their own.