HEALTH & MEDICINE SPOTLIGHT: Why Does America Spend More on Healthcare?

By  //  March 16, 2018

U.S. spends twice as much on health care as other wealthy countries

The United States pays more for healthcare as compared to other similar countries because it faces higher price tags for drugs, tests, office visits and administration.

EDITOR’S NOTE: It is often alleged that the U.S. spends more on healthcare than other countries because of an American propensity to higher healthcare utilization and an insistence on the best and most innovative medicine and associated technology.

However, a sweeping new study recently published in the Journal of the American Medical Association and reported on HealthDay News of why the United States spends so much more on healthcare than in other high-income countries concludes that higher prices — including doctors’ and nurses’ salaries, hospital charges, pharmaceuticals, and higher administration expenses are predominantly to blame.

The Affordable Care Act and other policy efforts have had minimal focus on healthcare pricing. The results of this study strongly suggest that a critical analysis and appropriate adjustment of pricing may be the key to improve the value of American healthcare.

— Dr. Jim Palermo, Editor-in-Chief

(HEALTHDAY NEWS) — It’s well-known that the United States spends a lot more for its health care than other industrialized nations do.

But a new study claims that some of the purported explanations for why America’s health care bill is so huge simply do not wash.

The United States does not use more health care than high-income peers like Canada, Germany, France and Japan, said study co-author Liana Woskie, assistant director of the Harvard Global Health Institute’s strategic initiative on quality.

Nor does America have too many high-paid specialists. “At least compared to peers, we have a pretty similar mix of primary care to specialists,” Woskie added.

Instead, it looks as though the United States pays more because it faces higher price tags for drugs, tests, office visits and administration, Woskie said.

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“We need to better understand why prices are so high and dive into that into much more detail, because some of the previous explanations may not actually be what’s driving the U.S.’s spending,” she said.

For this study, Woskie and her colleagues pulled together comprehensive data comparing U.S. health care against that of 10 other leading countries — the United Kingdom, Canada, Germany, Australia, Japan, Sweden, France, the Netherlands, Switzerland and Denmark.

The investigators found that the United States spends nearly twice as much of its wealth on health care — 17.8 percent of its gross domestic product, compared with between 9.6 percent and 12.4 percent in other countries.

CLICK HERE to read the rest of the report on, which provides the details of America’s healthcare spending and outcomes as compared to other countries.