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Expert compares high cost of health care to goods consumers can relate to

Melissa Mitchell, News Editor
217-333-5491; melissa@illinois.edu

Tom O'Rourke
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Photo by L. Brian Stauffer
Tom O’Rourke, a professor emeritus of community health at the University of Illinois, has spent much of his professional career examining the nation’s ailing, failing health-care system. In particular, O’Rourke has studied how the U.S. system compares with those in Canada and other Western nations.

11/16/2007

CHAMPAIGN, Ill. — If Americans spent the same amount of money on health care as counterparts in Canada and a number of other countries, the difference between what they spend now and what they would save annually would be enough to pay for two plasma TVs or three Big Macs a day.

The same savings might also cover a year’s worth of utility bills, feed a family of four for two years, fuel a car for two years and seven months, or be used to purchase a BMW sports car in 10 years.

Those are just some of the scenarios worked out in a new study by Tom O’Rourke, a professor emeritus of community health at the University of Illinois who has spent much of his professional career examining the nation’s ailing, failing health-care system. In particular, O’Rourke has studied how the U.S. system compares with those in Canada and other Western nations.

His findings haven’t exactly been uplifting for U.S. health-care consumers.

“The United States has the highest per capita spending on health care of any Organization for Economic Co-operation and Development (OECD) nation,” O’Rourke notes in the new study, which will be published in an upcoming issue of the American Journal of Health Studies. The OECD is a group of countries committed to democracy and market economy.

“Out of the 30 Organization for Economic Co-operation and Development nations, the United States has the highest per capita health-care costs of all at $6,102 as of 2004, despite having fewer physicians, doctors visits, hospital beds, hospital days and nurses per capita than the median OECD country,” O’Rourke said.

By contrast, the average spending per capita in Canada was $3,165 in 2004; the OECD median per capita (excluding Belgium, Japan and the Slovak Republic, for which 2004 data was unavailable) was $2,596.

“For a country that prides itself on being economically and technologically superior to most countries in the world,” O’Rourke asks, “why do we have the most expensive health-care system, but certainly not the best health statistics compared to the other OECD nations, including Canada?”

With the nation’s first 2008 presidential primaries just weeks away and health care emerging as voters’ No. 1 domestic concern, plenty of other frustrated health-care consumers are posing similar questions to candidates on the stump. And when surveyed, Americans indicate that the two health-care topics of greatest interest are access to coverage and out-of-control costs.

With respect to the latter, O’Rourke said, “health-care costs have rampantly been rising to levels that are unaffordable for more and more Americans each year. Americans have been struggling with escalating health-care costs, and the amount of money it costs to cover a family puts serious financial restraints on parents from median- to low-income families.”

But while just about everyone hears – and can relate to – the general rhetoric about costs and believes they’re paying more than ever before for doctor’s visits, insurance premiums, diagnostic tests, medications and hospital visits, few have a good handle on what’s actually being spent.

To better pin down the out-of-pocket expenses, O’Rourke wanted to figure out how much money a person might save if U.S. health-care spending were equivalent to the amount spent in Canada or the median amount in other OECD countries. Further, he determined it would be more useful – and revealing – to translate those costs into actual consumer goods and services.

“Instead of just presenting the differences in per capita health-care spending in a strictly numbers format, which has been overused and is meaningless because of the huge numbers that are incomprehensible, this project aims at putting a consumer price value on the savings,” he said.

The savings were broken down into three categories: consumer products, health care and finances.

The bottom line, O’Rourke said, is that “the amount of money we are spending on health (in the United States) is absolutely ridiculous, and something needs to be done before it’s too late,” O’Rourke said. “A health-care restructuring in this country is necessary to relieve the burden of costs and increase the overall health of the United States.

“Both of these goals are achievable if meaningful health-care reform is reached, but exactly how we are to do that is a difficult question that has puzzled many for years. Reform proposals are commonplace, but meaningful reform remains elusive.”