Every three years, The Commonwealth Fund does a great public service by publishing its “Mirror Mirror” analysis of developed world healthcare systems. This is the eighth report, which relies on surveys as well as national and international healthcare data. The 2024 analysis accounts for the COVID pandemic impacts and results are consistent with previous years.
In effect, the Commonwealth Fund ranks healthcare systems’ performance based on leading access, efficiency, quality, and value metrics. It looks at 70 health system performance measures in five areas: access to care, care process, administrative efficiency, equity, and health outcomes. This year it compared statistics in ten countries instead of 11: Australia, Canada, France, Germany, the Netherlands, New Zealand, Sweden, Switzerland, the United Kingdom, and the United States. Norway dropped off the analysis list because in 2022 the country exited the International Health Policy Survey. Norway was ranked number 1 in the 2021 analysis.
The study notes that nine countries (not the U.S.) have their strengths and weaknesses, but “all have found a way to meet their residents’ most basic healthcare needs, including universal coverage.” The nine rank high on some dimensions and lower on others. But another thing is clear: the only outlier on performance of the study group is again the United States. Commonwealth finds that the other nine developed countries have overall performance differences that are relatively small. The U.S. is last and performs demonstrably worse than even the other lowest performing countries. Commonwealth calls the U.S. performance “dramatically lower.”
As before, the U.S. does rank second in the care process domain, giving us insight into a “have vs. have not” dilemma here in America. If you have wealth or have great insurance you get great care and have a chance at being healthy; if you aren’t wealthy or have no or poor healthcare coverage, you are very much out of luck.
Commonwealth again substantiates that the U.S. spends the most on healthcare (from a percentage of gross domestic product (GDP) standpoint) yet performs the worst. So, not only do we have poor quality and efficiency, but we have the lowest value of other developed countries.
Let’s discuss healthcare system types
There are at least three types of healthcare systems in the developed world. It is important to note that the three types and their characteristics are not absolute. Nations may use combinations of characteristics of each or even have exceptions in terms of how care is furnished.
There is the socialized or state-run healthcare system. A good example of this type is the United Kingdom’s healthcare system. In this type, for the most part the government runs, finances, and delivers services. Those rules are not absolute, though, as over time Britain has begun contracting with private providers for some delivery of care.
A second type is the single-payer system. The government runs and finances the system, while private entities largely deliver the care. France, Australia, and Canada (the last through its provinces) are good examples of this.
And last is affordable universal access using a private system. In this type, the government regulates and finances some coverage, but private entities run the system and deliver care. Examples of nations with this system are Germany, Switzerland, and the Netherlands.
While the U.S. would appear to be like these nations, there are two critical differences. The other nations’ private systems are centralized and are not primarily employer-based. Further, the nations with private systems as well as the other two types emphasize enough government funding to ensure affordable universal access for all citizens. Government financing comes from various sources, including value-added taxes, business taxes, income taxes, and employer and individual contributions.
Who scored at the top of the Mirror, Mirror 2024 study?
The top three countries were Australia, the Netherlands, and the United Kingdom. What is interesting about the results is that the top 3 represent each of the three types of healthcare systems. It proves that each type can be well-run, quality-producing, and deliver for their citizens. The thing they have in common is affordable universal access to healthcare.
More on the study results
Overall Rankings and U.S. Performance in Care Process: As can be seen in the chart above from the Commonwealth Fund study, America performed 9th or last in all domains except Care Process. This gave the U.S. the distinction of being the worst rated. And as the data also show, the U.S. was an outlier even against the bottom performing plans. See the chart just below. (All charts courtesy of The Commonwealth Fund, with various sources at the bottom of each graphics.)
Regarding our relatively high performance on Care Process, it tells us that if you have strong insurance in America or are wealthy and can afford to pay out of pocket, the U.S. system can excel in some things, such as preventive care, safe care, coordinated care, as well as engagement and meeting patient preferences. The study notes that America succeeds here in part due to the successful provision of preventive services, such as mammograms and flu vaccines, and our emphasis on patient safety. Commonwealth says our high ranking here might reflect the vigorous Star pay-for-performance policies in Medicare Advantage (MA) and fee-for-service (FFS) pilots as well as in other coverage. On patient safety, the study points to our significant reductions in adverse events during hospital stays for heart attack, heart failure, pneumonia, and major surgeries since 2010.
But for those tens of millions who are uninsured or underinsured, you very much fall through the cracks in America. You likely don’t get to benefit from the outstanding Care Process in America. You are very much getting America’s 9th and 10th place finishes in Access to Care, Health Outcomes, and Equity.
Spending: The Commonwealth study looked at the rise in U.S. healthcare spending over time. It found that in 1980 U.S. healthcare expenditures were at the high end of the distribution of the nations studied, but were comparable to Sweden and Germany. Over the last 40 years, however, U.S. spending has far outpaced that of other nations. Commonwealth looked at 2022 spending and determined the U.S. spent more than 16 percent of its GDP on healthcare (the CMS Actuary says it was 17.3% in that year). That figure is predicted to rise over time and hit one-fifth the economy.
The other countries in the survey spent between 4 percent and 8 percent of GDP in 1980 and in 2023 spent between 8 percent and 12 percent. And confirming the old adage that more isn’t always better, the two countries with the highest overall rankings, Australia and the Netherlands, have the lowest healthcare spending as a percentage of GDP. Thus, America’s value – performance compared with spending – is the lowest and also a huge outlier. This in part caused our 9th place finish in Adminstrative Efficiency.
Commonwealth recommendations
The Commonwealth Fund suggests a number of things to help us improve.
- It suggests we look at the high performers in each category. It again notes that performance in domains can be very different and therefore every country can pick up some improvements or best practices from other nations.
- It says we must address financial barriers to care, which are significant. This involves both the uninsured and the underinsured. It notes that a quarter of the insured are underinsured. I peg the uninsured and underinsured count at 80M to 85M Americans.
- It suggests America must invest in primary care. We have a fundamental lack of investment here and instead have an excessive reliance on high-cost places of services, such as hospitals and emergency rooms.
- It says more regulation may be necessary, including simplification of products, processes, and more. Consolidation has raised prices and not saved. They need to be addressed. Antitrust has become a big focus of the Biden administration and Congress.
- It calls for much needed public health investments.
My recommendations
The Commonwealth Fund recommendations dovetail with many of my findings and recommendations in my book, The Healthcare Labyrinth. I have written a series of blogs at the Blog Tab of this website, which summarize the healthcare reform proposals in my book. Simply put, I have three overarching reform areas to bend the cost curve and improve quality and outcomes:
- Affordable universal access: We have 80M to 85M uninsured or underinsured. While the Affordable Care Act (ACA) expanded Medicaid and created Exchange coverage, it has not closed the uninsured gap completely. We have between 8 and 10 percent uninsured while most developed countries sit at 1 percent on average. And, given the huge costs of our system, the premiums and cost-sharing Americans pay are well above other developed countries. There is a real issue of affordability of healthcare, represented by the underinsured. We need to adopt the true principles of a private universal access system.
- Price: America has a huge price problem across the board. While all other system types set prices globally for their systems, America does not — save for the Medicare and Medicaid fee-for-service (FFS) programs. Price in U.S. healthcare is many folds above other developed nations. This is acutely so for hospitals and drugs. The exorbitant prices for drugs and services drives our healthcare spending and makes things unaffordable, impacting accessing care.
- Health, wellness, primary care, and care management: The U.S. system does not prioritize wellness, prevention, and management of disease states. It is obsessed with utilization management as opposed to care management. We need to pivot to care management from utilization management.
Is everything perfect in the rest of the world?
Does this mean that everything is perfect in the rest of the developed world? Certainly not. Even as the United Kingdom was rated among the top three countries for healthcare by Commonwealth, the UK is reeling from a just-issued report that looks at all the problems in its system and makes numerous recommendations. That study link is below. A few findings and recommendations:
- The National Health Service (NHS) is in serious trouble.
- The health of the nation has declined and social determinant impacts have worsened, which contributed to the problems at the NHS.
- Wait times for services are up across the board, including primary care.
- Emergency and hospital care wait times have ballooned.
- Cancer care is lagging other countries.
- Care for chronic disease is deteriorating.
- While quality of care is good, the record is mixed.
- Too many dollars are spent in hospitals when it should be in the community. This is leading to more being done at higher cost places of service.
- Operating and capital spending was too austere in the past, including in new technology.
- There is a lack of staff and patient engagement.
- A lack of management structure and oversight. Reform is needed.
Conclusion
Britain is not alone in having an ailing system. The same can be seen in other socialized medicine systems, single payer systems, and even in private delivery systems. We even see private or supplemental insurance popping up in these other counties to fill in gaps and soften the wait times that exist for services.
But it is fair to say that these developed nations’ systems function much better than America does from an efficiency and quality standpoint.
Does this mean we give up our current employer-based system and migrate to one of the three types above. Not necessarily. America could keep its employer-based system, which a majority of Americans seem happy with, but drive toward efficiency and lower price/cost, emphasize care management, and close the coverage gaps. It would take lawmakers on Capitol Hill to get serious about affordable access, tackling price, and pivoting from utilization management to care management. The recipe is out there. Think tanks and policy experts have laid it all out (my book summarizes the ideas and adds to them). But courage in Washington, D.C. is needed.
Sources:
https://www.commonwealthfund.org/publications/fund-reports/2024/sep/mirror-mirror-2024
#healthcare #healthcarereform #coverage
— Marc S. Ryan
