Redefining Health Care in America

Dr. Robert C Sizemore

A BASIC TENET

�The United States (U.S.) has one of the best health-care

systems in the world, although over 61,000,000

residents live without affordable access to health and

preventive care because they lack medical insurance or

have insufficient insurance coverage (Schoen, Doty,

Collins, & Holmgren, 2005).

U.S. HEALTHCARE SYSTEM TODAY

�Restrictive access policies and insurance complexities in

the U.S. hinder compliance with recommended medical

and preventive care and compare unfavorably to

industrialized health-care systems globally

(Organization for Economic Co-operation and

Development [OECD], 2005).


�Federal, state, and private insurance agencies in the U.S.

design and market health insurance programs with

thousands of plans, options, modifications, and

exclusions (Crosson, 2005), yet approximately 37% of

Americans age 19 and older remain uninsured or

underinsured (The Commonwealth Fund, 2007).


�The National Coalition on Health Care (2004) reported

several factors contribute to management and performance

problems within the United States: excessive overhead costs,

pricing anomalies, inadequate care, operational waste, and

financial fraud. The coalition also noted increasing costs of

medical care and insurance adversely affect the health and

financial security of families in the United States (National

Coalition on Health Care, p. 1).


�Although health-care expenditures increased $1.1

trillion from 2002 to 2005, medical and patient

outcomes trended below industry averages (The

Commonwealth Fund, 2007).


�The unprecedented rise in health-care expenditures

to 16% of the total U.S. gross domestic product (GDP)

in 2005 represented a $3,754 increase in health-care

delivery costs for every resident living in the United

States (Henry J. Kaiser Family Foundation, 2006).


�The 16% increase in U.S. health-care expenditures in

2005 significantly outpaced other industrialized

nations that reported healthcare cost increases of

10.9% in Switzerland, 10.7% in Germany, 9.7% in

Canada, and 9.5% in France during 2005 (OECD,

2005).


�Approximately half of reported bankruptcies in the

U.S. cite medical-related reasons for filing, indicating

1.9 to 2.2 million Americans experience medical-

related bankruptcy annually (Himmelstein, Warren,

Thorne, & Woolhandler, 2005).


�Among filings related to medical bankruptcy, illness was

the primary cause for out-of-pocket costs that averaged

$11,854 from the time the illness started, while 75.7% of

medical bankruptcy filings reported having some form

of medical insurance prior to the onset of illness.

(Himmelstein, Warren, Thorne, & Woolhandler, 2005).

HEALTHCARE COSTS

�Healthcare costs in the U.S. totaled $6,801 per capita in

2004 compared to $2,882 per capita, representing a

combined average, used in this analysis, representing the

13 nations that economically compete with the U.S.

globally.

Note: The next closest industrialized nation, Switzerland

spent $4,077 on healthcare per capital in 2004.

THE PROBLEM

� The problem is that despite trillion dollar expenditures

and rapid technological growth (Corrigan et al., 2003), a

number of operational deficiencies compromise the U.S.

health-care delivery system, including restricted access to

affordable health and preventive care for all residents

[driven by] a non-standardized, financially complex mixed

private–public funded health-care system (OECD, 2005).

POTENTIAL for IMPROVEMENT

�The benefits associated with combining universal access

and a simplified-payer financial system modeled after

industrialized countries that economically compete

with the U.S. was investigated, which may potentially

mitigate the current barriers to health and preventive

care currently being experienced within the United

States.

THE PURPOSE

�The purpose of the study was to quantify the possible

benefits of a universal access, (simplified) single-payer

health delivery system in the U.S.

�The study involved a statistical investigation focused on

the benefits associated with combining universal access

and a single-payer financial system in the U.S. modeled

after industrialized countries outside the United States.

THE OBJECTIVE

�Alignment of the U.S. health-care system and

infrastructure with universal access and a single-payer

(simplified) financial system patterned after

industrialized nations globally, may alleviate some of

the complexity and limitations associated with the

inexorable increases in health-care expenditures.

THE ANALYSIS

�A detailed analysis of 14 industrialized nations (including

the U.S.) quantitatively correlates universal access and a

single-payer financial system based on three selected (3)

life expectancy measures and four (4) healthcare cost

measures that are utilized and accepted as international

standards of quality healthcare performance (OECD,

2005).

THE PROCESS

�A quantitative cross-functional analysis was engaged to

investigate the advantages and disadvantages of

universal access and a single-payer financial system

measured against health delivery systems that

economically compete with the U.S. in a global health

care community.

A PRESUPPOSED EVENT

�A redefining, integrative process presupposes affordable

redistribution of medical resources to include all U.S.

residents including the uninsured and underinsured

populations in the United States.

SELECTION of ANALYSIS COHORT

Rationale Cohort

� Cross-cultural data was

collected for each nation from

public domain repositories

representative of nations that

economically compete with the

United States and utilize a form

of universal access and single-

payer health-care delivery

system.

Australia Canada

Denmark Finland

France Germany

Italy Sweden

New Zealand Norway

Switzerland Japan

and The United Kingdom.

DEFINITIONS

�Universal access to health and preventive care is

defined as open access, for all U.S. residents, to the

complete array of available health-care services.

�Restricted access to health and preventive care is

defined as limited access, due to ineligibility, health risk,

insurance costs, or insurance coverage parameters.

DEFINITIONS

�Affordable is a derived value calculated at 25 to 50%

more than the OECD’s (2005) average cost of delivering

health care per capita globally.

METHODOLOGY

�The research study utilized a statistical investigation

process to determine the advantages and disadvantages

of opening the U.S. to universal access and a simplified

single-payer financial system, as an alternative to

declining health outcomes, financial insolvency, and

health system failure (Menninger, 2003).

METHODOLOGY

�A quantitative cross-functional analysis investigated the

potential benefits from integrating universal access and

a simplified single-payer financial system into the U.S.

health system.

METHODOLOGY

�The analysis applied descriptive, inferential, and line

charting methodologies that were appropriate for the

continuous attribute data and statistical variation

analysis within the study (Carey & Lloyd, 1995, p. 70).

SELECTION ofLIFE EXPECTANCY MEASURES

1. Increased life expectancy at age 65

2. Reduced infant mortality during the first year

of life

3. Reductions in total health-care expenditures

as a percentage of Gross Domestic Product

(GDP)

SELECTION of HEALTHCARE COST MEASURES

1. Health-care cost per capita

2. Patient out-of-pocket costs

3. Total health-care expenditures

4. Total health-care cost as a percentage of Gross

Domestic Product (GDP)

GLOBAL RANKING

Global Ranking of Demographics

Nation

GDP

($ billions)

Total expenditures

($ billions)

10-year average

growth ranking

Population

ranking

Australia 666.3 6,130 13 54

Canada 1165 11,533.5 4 37

Denmark 198.5 1,766.65 3 108

Finland 171.7 1,287.75 2 111

France 1871 1,9645.5 8 20

Germany 2,585 2,8176.5 5 14

Italy 1,727 1,4506.8 1 23

Japan 4,220 33,760 7 10

New Zealand 106 890.4 9 123

Norway 207.3 2,010.81 14 116

Sweden 285.1 2,594.41 11 86

Switzerland 252.9 2,933.64 6 94

United Kingdom 1,903 15,794.9 12 22

United States 12,980 198,594 10 3

OECD health data 2005

STATISTICAL EVIDENCE

�Statistical evidence indicates that the United States

resident population could quantifiably benefit from

universal access to medical and preventive care.

INFANT MORTALITY

The Centers for Disease Control and Prevention, 2006 and OECD health data 2005

LIFE EXPECTANCY RATES FROM BIRTH


LIFE EXPECTANCY RATE at AGE 65


HEALTH CARE COSTS per CAPITA


PATIENT OUT of POCKET COSTSas a % of TOTAL EXPENDITURES


TOTAL HEALTH CARE COSTS as a % of GDP


TOTAL HEALTH CARE COST (Nominal) GDP


UNIVERSAL ACCESS

�Universal access to health and preventive care for the

entire U.S. population (U.S. Census Bureau, 2007),

statistically exhibits lower infant mortality rates,

increased life expectancy from birth rates, and increased

life expectancy at age 65 and over rates.

INFANT MORTALITY

�The U.S. infant mortality rate of 6.7 deaths per 1,000

births could effectually experience a reduction of

between 1.9 to 2.9 deaths per 1,000 births to 3.8 and 4.8

deaths per 1,000 births (The Centers for Disease Control

and Prevention, 2006), p < .05.

LIFE EXPECTANCY

�The U.S. life expectancy from birth rates, could

effectually experience an increase of between 1.1 and 2.2

years of age to 79.2 and 81.3, based on 2006 life

expectancy from birth rates of 78.1 years (The Centers

for Disease Control and Prevention, 2006), p < .05.

LIFE EXPECTANCY OVER AGE 65

�The 2006 U.S. life expectancy at age 65 and over rate of

18.7 years could effectually experience an increase of

between 0.2 and 1.2 years of age to 18.9 and 19.9, p < .05.

STATISTICAL SIGNIFICANCE

�A reduction in health-care cost per capita would reflect

an overall reduction in total health-care cost as a

percentage of GDP. An overall reduction in total health-

care costs as a percentage of GDP from 15.3% to between

8.6 and 9.9% is statistically significant, p < .05.

SIMPLIFIED SINGLE-PAYER SYSTEM

�A simplified single-payer financial system in the U.S.

could effectually reduce health-care expenditures

between $854 million to $1.1 billion based on fiscal year

2004 financial calculations and a U.S. census count of

285.7 million residents (U.S. Census Bureau, 2007).

STATISTICAL VALUES

Statistical Values for Dependent Variables

Dependent variables M SD skew Kurtosis

Infant mortality rate a 4.44 1.02 0.326 -0.296

Life expectancy from birth a 79.60 1.05 -0.066 -0.997

Life expectancy rate at age 65 b 19.32 0.89 0.172 -0.113

Health-care costs per capita c 3,111.50 1,045.87 1.982 4.753

Out-of-pocket spending c 16.36 5.37 1.326 4.153

Total health-care cost % of GDP c 9.69 1.99 1.852 4.341

Total health expenditures c 24,258.92 51,272.82 3.477 12.545

a FY 2006. b FY 2005. c FY 2004.


STATISTICAL ANALYSIS VALUES

Universal Access One-sample T test Analysis

Life Expectancy

Dependent

Variables

U.S.

N

13-nation

non-U.S.

N 95% LCL

t UCL p

Infant mortality 6.7 4.3 3.8 4.8 -2.64 -2.11 -1.58 0.0000

Life expectancy

from birth

78.1 79.7 79.2 80.3 1.13 1.72 2.32 0.0000

Life expectancy

age 65+

18.7 19.4 18.9 19.9 0.09 0.67 1.24 0.027


STATISTICAL ANALYSIS VALUESSingle-payer Financial One-sample T test Analysis

Health-care Cost

Dependent

Variables

U.S.

N

13-nation

non-U.S.

N 95% LCL t UCL p

Costs per capitaa 6102 2881 2545 3218 -3595 -3221 -2847 0.000

Out-of-pocket

costs %GDP

13.0 16.6 13.6 19.6 0.3 3.6 6.93 0.035

Total health-care

cost %GDP

15.3 9.3 8.6 9.9 -6.8 -6.0 -5.31 0.000

Total health

expenditureb

198594 10849 4883 16814 -194377 -187745 -181114 0.000

a In thousands of U.S. dollars. b In billions of U.S. dollars.


CONTRAST and COMPARE

�The analysis contrasted and compared health-care

outcomes and financial acuity levels between the U.S.

and the 13 other health-care systems representing

nations that economically compete within a global

health-care market.

COMPARE and CONTRAST

�The research design methodology as investigated,

analyzed, and reported herein, statistically quantifies

potential benefits of reduced infant mortality, increases

in life expectancy and reductions in financial costs,

based on universal access and a single, (simplified)

payer financial system in the U.S.

AN OPTION?

�Barlett & Steele (2004) proposed a path advancing

health-care reform on a national level within the U.S.

noting:

AN ALTERNATIVE?

�There is a need for the U.S. to take a fresh approach, a

new organization that is independent and free from

politics that focuses with laser-like precision on what

needs to be done to further the health interests of

everyone in a fair manner, knowing what must be done

to advance the health interests of everyone in the U.S.

in an equitable manner.

A SOLUTION?

�Essentially, advocating a tax-financed, Federal Reserve-

like system assuring unrestricted access to health and

preventive care, strict cost controls, increased

practitioner (physician and nurse) incomes that are

determined to be too low, addressing geographic (rural)

variations, and curtailing over-diagnosis and over-

treatment practices. (Barlett & Steele (2004), p. 239)

A CONTINUING PROCESS

“We all declare for liberty; but in using the same word we do

not all mean the same thing. With some the word liberty

may mean for each man to do as he pleases with himself, and

the product of his labor; while with others, the same word

may mean for some men to do as they please with other men,

and the product of other men’s labor. Here are two, not only

different, but incompatible things, called by the same name--

-liberty. And it follows that each of the things is, by the

respective parties, called by two different and incompatible

names---liberty and tyranny.”

---ABRAHAM LINCOLN, 1864

REFERENCES� Schoen, C., Doty, M. M., Collins, S. R., & Holmgren, A. L. (2005, June 14). Insured but not protected:

How many adults are underinsured? New York: The Commonwealth Fund. Retrieved July 15, 2006, from http://www.cmwf.org

� Corrigan, J. M., Greiner, A., & Erickson, S. M. (2003). Fostering rapid advances in health care: Learning from system demonstrations. Washington, DC: Institute of Medicine, National Academies Press. Retrieved October 10, 2006, from ProQuest database.

� Organisation for Economic Co-operation and Development. (2005). OECD health data 2005. Retrieved December 30, 2005, from http://www.oecd.org/health

� Menninger, B. (2003, August). Hospitals: The tipping point. Retrieved March 31, 2004, from http://www.healthleadersmedia.com/magazine/view_magazine_feature.cfm?content_id=47289

� Crosson, F. J. (2005). The delivery system matters. Health Affairs, 24, 1543-1548. Retrieved January 10, 2007, from EBSCOhost database.

� The Commonwealth Fund. (2007). A high performance health system for the U.S.: An ambitious agenda for the next president. Retrieved November 15, 2007, from ttp://www.commonwealthfund.org/ publications/ publications_show.htm?doc_id=584834&#areaCitation

� National Coalition on Health Care. (2004). The impact of rising health care costs on the economy. Retrieved February 21, 2007, from http://www.nchc.org/facts/ economic.shtml

� Henry J. Kaiser Family Foundation. (2006). Employee health benefits: 2006 annual survey. Retrieved February 20, 2007, from http://www.kff.org/insurance/7315/ index.cfm

REFERENCES� Himmelstein, D. U., Warren, E., Thorne, D., & Woolhandler, S. (2005, February). Illness and injury

as contributors to bankruptcy. Health Affairs Web Exclusive, 63-73. Retrieved February 22, 2007, from http://content.healthaffairs.org/cgi/reprint/hlthaff.w5.63v1.pdf

� Carey, R., & Lloyd, R. (1995). Measuring quality improvement in healthcare: A guide to statistical process control applications. New York: Quality Resources

� U.S. Department of State's Bureau of International Information Programs. (2007). What is the Group of 8? Retrieved March 5, 2008, from http://usinfo.state.gov/ei/economic_issues/group_of_8/ what_is_the_g8.html

� The Centers for Disease Control and Prevention. (2006). U.S. Mortality Drops Sharply in 2006, Latest Data Show. Retrieved June 14, 2008 from http://www.cdc.gov/nchs/ pressroom/08newsreleases/mortality2006.htm

Redefining Health Care in America

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