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NAVIGATION
PNHP RESOURCES

Senate panel examines health systems in Canada, Taiwan, Denmark and France

By Deborah Schumann, M.D.

WASHINGTON – Sen. Bernie Sanders, I-Vt., chairman of the Senate Subcommittee on Primary Health and Aging of the Health, Education, Labor and Pensions Committee, held a hearing Tuesday to gain insight into the health care systems of four other countries, all of which view health care as a human right and have achieved near-universal coverage and access to care for their citizens. 

The senator opened the session with a comparison of the U.S. system with those of other industrialized nations. He noted the U.S. system is characterized by: 

* Double per-capita spending

* Third-world-like access for many in the U.S.

* Financial barriers and bankruptcy consequences related to health care

* 45,000 deaths/year linked to lack of insurance

* Poor efficiency: U.S. ranked 46th out of 48 countries

* Poor outcomes, e.g. of 34 OECD countries, U.S. is 26th in life expectancy

* Drugs are so expensive that many patients forgo treatment

Ranking subcommittee member Sen. Richard Burr, R-N.C., then weighed in, saying that Obamacare is going in the “wrong direction” and that Americans view it unfavorably. He stated that Medicaid is “unsustainable” and is not accepted by 40 percent of physicians. Furthermore, he stated that premiums in the individual market have risen by 41 percent since Obamacare passed. His proposal for improving the system is to increase “individual choice.”

Then the invited witnesses delivered their testimony. 

Tsung-Mei Cheng, L.L.B., M.A., health policy analyst at the Woodrow Wilson School of Public and International Affairs at Princeton University, summarized the features of a single-payer health care system: 

* Single payer does not equal socialized medicine

* Equity of access; access not based on ability to pay

* Equity of payment to providers

* Financing based on ability to pay

* Competition based on quality, not price

* Patients have choice of providers

* No job-lock; not based on employment

* Total spending is easy to control

* Electronic billing leads to substantial savings

* Data capture is facilitated

* Public satisfaction is generally high as demonstrated in other countries

* Medicare (the U.S. single-payer program) is popular

France 

Victor Rodwin, Ph.D., M.P.H., professor of health policy and management at the Robert F. Wagner School of Public Service at New York University, spoke about the French system. It is not a socialized medicine system like Cuba or the U.K., but rather a publicly financed, privately delivered system with supplementary private insurance to cover co-pays. Patients have free choice of providers whether in public or private hospitals. The French people are proud of their system which is based on liberté, égalité and fraternité. There are no gatekeepers or networks and everyone has access to care. The French rate of “avoidable mortality” [e.g. infant and maternal mortality is 55-60 percent that of the U.S., according to The Commonwealth Fund, 2012] France controls its costs through bulk purchasing, price controls and low administration costs. 

Taiwan

Ching-Chuan Yeh, M.D., former Taiwanese minister of health and currently professor at Tzu-Chi University in Taiwan, said that “having a single-payer system is the main reason for our efficient services and also controls prices.” With a national fee schedule, providers compete on the basis of quality. Like France, Taiwan has public financing and private delivery of care which includes both not-for-profit as well as for-profit centers. All payments are made electronically keeping administrative costs down. Dr. Yeh stated that they have achieved 99.6 percent coverage and that there is not much of a problem of waiting lines for services. The country has seen improvements in both longevity and infant mortality since implementing the system in 1995, and they are on the road to a universal, individualized electronic medical record. 

Denmark

Jakob Kjellberg, M.Sc., professor and program director at the KORA-Danish Institute for Local and Regional Government Research in Copenhagen, described the Danish system as “comprehensive and universal.” Danes choose a GP and get referrals from her or him for specialty care. They have full choice of providers including hospitals. If wait-lines are too long, they have the option of going to private hospitals or out of the country. Overall administrative costs are 4.3 percent [i.e. far less than the U.S. system as a whole, which is 15-30 percent by various estimates, but similar to U.S. Medicare’s percentage].

Canada

Danielle Martin, M.D., M.P.P. , vice president for medical affairs and health system solutions at Women's College Hospital, Toronto, spoke about Canada’s single-payer system. She emphasized that in spite of some shortcomings (wait-times for elective services), the Canadian people are firmly in favor of Canada’s Medicare. There is zero political will in Canada to move to a market-based, for-profit, fragmented system like we have here. She said even conservative politicians don’t oppose Canada’s Medicare, for fear of committing political suicide. The Canadian system is centrally financed but administered by the provinces. It is based on:

* Equity and medical need

* Central oversight for issues e.g. more primary care training

* Low administrative overhead

Canada achieves better outcomes than the U.S. at two-thirds the per capita cost of the U.S. market system. Urgent care is always available.

Speakers for ‘market-based health care’ 

Sally C. Pipes, CEO of the Pacific Research Institute in San Francisco, and David Hogberg, David Hogberg, Ph.D., health care policy analyst at the National Center for Public Policy Research in Washington, had been invited by Sen. Burr to speak in favor of a market-based health care system such as we have in the U.S. Ms. Pipes testified that she had emigrated from Canada to San Francisco. She told the story of her mother who waited several months in a queue, was finally taken care of but died two weeks later. Her opinion was that the Canadian system “would not be suitable for the U.S.” because she thinks that waiting weeks to see a specialist won’t work here. Her punchlines were that 42,000 Canadians come to the U.S. for care every year and that one Canadian top official came to the U.S. for cardiac surgery. Ms. Pipes made clear that waiting too long is bad for your health. 

Mr. Hogberg spoke in favor of “removing the health care system from control of politicians.” He pointed out that the sick are few in number and not political. In his opinion, “patients overuse health care.” He worried about the fact that “France doesn’t pay for pharmaceuticals that are incrementally better.” He reiterated that French co-insurance picks up out-of-pocket expenses for patients while the government controls 77 percent of health care expenditures. His opinion is that the U.S. should look at other countries’ systems in order to discover what policies to avoid and study other competitive markets like auto insurance, food and clothing.

Sen. Sanders asked Mr. Hogberg if we should get rid of Medicare. He did not answer yes or no, but said it is a “moot point.”

Sen. Sanders asked Dr. Rodwin why U.S. health care spending is so high, especially in light of relatively poor outcomes. The answer is that prices are “much higher because we have no price control.” He added, “The free market system doesn’t exist anywhere in health care.”

Sen. Burr asked Dr. Martin why doctors are exiting the public system in Canada. She replied that he had misunderstood her remarks and “that there are no doctors exiting the public system in Canada.” With regard to excessive wait times in Canada, she said that the country has a commission to address the issue and that “the solution is not to move away from our single-payer system toward a multi-payer system.” She said that having a single payer allows the wait-time commission to appropriately address the issue. “Sometimes it is not about the amount of resources, but on how you organize people,” adding, “And this organization should be based on criteria that benefit everyone, not just those who can afford to pay.”

Several other subcommittee members made comments or asked questions.

Sen. Mike Enzi, R-Wy., opined that “the Affordable Care Act was designed to fail so that we would go to single-payer health care.” But he feels that the debacle of the exchanges has convinced Americans that government can’t succeed in universal health care. He didn’t ask any questions.

Sen. Pat Roberts, R-Kan., asked Dr. Martin about how the Canadian system makes changes, e.g. Can the prime minister make changes? She replied that “the public commitment to our single-payer Medicare system is so strong that for a prime minister of any stripe to try and alter that or undermine it in any way would be political suicide.” Sen. Roberts replied, “I got your message.”

Sen. Sanders followed up by saying, “Canadians understand that a system that guarantees health care for all their people in a cost effective way is the way that they want to stay.”

Sen. Chris Murphy, D-Conn., followed up on the wait-time/convenience discussion with the opinion that convenience does not necessarily equal quality. He said that the other two important aspects of quality are outcomes and cost control. 

There was quite a bit of discussion about pharmaceuticals:

* France, Taiwan and Denmark provide drug coverage in their national health care financing systems

* Canada, according to Dr. Martin, has realized that they made a mistake in not including drug coverage in Canadian Medicare. She said that Canada has an estimated 10 percent non-compliance. [the comparable figure in the U.S. is 25 percent]

* Dr. Cheng believes that high drug costs, partially fueled by R&D of new products, is “pricing people out of the system”

* Both Taiwan and Denmark have out-of-pocket limits on drug spending ($1,000/yr. and $600/yr., respectively.

Dr. Cheng concluded the hearing following up on Sen. Murphy’s remarks and responding to a question from Sen. Burr by saying: “Yes, the United States does fund a whole lot of R&D in pharmaceutical and other device innovations. But in so doing we are helping to make the American health care system that much more expensive; in fact so expensive that we are pricing people out of the health care altogether . … In single-payer systems, the government can set aside money for R&D.” He added: “A very serious issue in U.S. health care is overuse. An Institute of Medicine book states that about one-third of U.S. health care is waste. Unnecessary services are about one-third of that waste.”

A video of the hearing and links to statements of all participants can be found here: http://www.help.senate.gov//hearings/hearing/?id=8acab996-5056-a032-522e...

A 4-minute YouTube video of clips from the hearing can be viewed here: https://www.youtube.com/watch?v=9WdqtPLRc1A 

Dr. Deborah Schumann practiced ophthalmology for 25 years in a variety of clinical settings. Since retiring from practice she has been an active advocate for reform of the U.S. health care system. She is active in Healthcare-NOW of Maryland as well as Physicians for a National Health Program. She resides in Bethesda, Md.