The NHS – as good as US heathcare but much much cheaper

When American campaigners against President Obama’s health-care reforms attacked his plans by throwing wild accusations against the NHS, it was inevitable that the row would spread to Britain. In the media and the blogosphere, the supporters and opponents of both systems have lined up to have a go at each other. Many of these commentators are adopting entrenched positions and there is a disappointing lack of data in their discussions. They tend to be anecdotal. ‘The NHS left my mum to die’ or ‘But for the NHS I wouldn’t be here’  is the flavour of much of the debate.

This is not really surprising. For some, belief in a type of health-care system has become an article of faith. Supporters of the religious right in the US are turning up in large numbers to protest about Obama’s plans to make the US more like Commie Britain with its free health service. There is little point in trying to refute their views about Britain’s health system with facts. Many of these people believe that the Earth was created in 4004 BC. If they can cling to that belief despite overwhelming evidence to the contrary any fact-based arguments about the relative merits of health-care systems are futile. That said, many on the British left show an almost equally dogmatic opposition to the introduction of any private provision into the UK’s health service, despite evidence that it might have had some positive effects.

And as for Daniel Hannan; this is the man who said that the UK’s economy should be more like Iceland’s. If he’d had his way the country probably would be bankrupt by now. Few people have taken him seriously in the past and there is no reason why we should start doing so now.

The lack of evidence-based discussion about the relative performance of health-care systems around the world is even more disappointing when you consider that, just over a month ago, the OECD released its Health Data 2009 report. Try doing a news or blog search. Hardly anyone has referred to it even though this row has been rumbling on for the past few days.

The bad news is that you have to pay for the report and I’m far too tight- fisted to do that. The good news is that some bloggers have nicked bits from it and posted them. There is also a spreadsheet available for those geeky enough to want to manipulate the data themselves.

These two graphs make interesting reading. The first shows total expenditure on health as a share of GDP. Despite recent government spending increases, the UK still spends below the OECD average and much less than Germany and France. The USA, by contrast, spends by far and away the most of any country.

Health GDP

But it is this second graph where things start to get really interesting.

 This shows health-care spending per head of population. Once again, the UK is around the OECD average and the USA is way out in front. But look at the graph closely. It splits the spending between publicly funded and private provision. The USA spends more public money per person on health-care than the UK does.
health per capita

Just in case you missed that, I’ll say it again. The ‘free-market’ US health-care system spends more public money per head than the ‘socialist’ British one. Work that out then.

The OECD report makes this comment:

For this amount of expenditure in the United States, government provides insurance coverage only for the elderly and disabled (through Medicare, which primarily insures persons aged 65 and over and people with disabilities) and some of the poor (through Medicaid and the State Children’s Health Insurance Program, SCHIP), whereas in most other OECD countries this is enough for government to provide universal primary health insurance.

Expenditure is about the only area in which the USA tops the table. Its number of nurses per head of population is around the OECD average and its number of doctors significantly below the average. In both cases, the numbers are similar to those in the UK, despite the huge difference in spending. Its life expectancy rate is below that of the UK and the OECD average. Its infant mortality rate is worse than the UK’s, slightly worse than Poland’s and on a par with that of Slovakia. The USA scores better on flashy machines like MRI and CT scanners but that’s about it. It’s as if the British have bought a VW Golf and the Americans have bought an Audi A3 but paid the price of a Mercedes S-Class.

I have no idea why any of this should be. I don’t know enough about the American health system to offer an explanation and, unlike the morons sounding off about our National Health Service on TV and in public meetings in the USA, I’m not arrogant or rude enough to attack another country’s health system without having some knowledge of how it works and what it is up against.

The data don’t look good though. Whatever else you might conclude, the Americans pay a hell of a lot of money for health-care, both from taxes and from private insurance. We, on the other hand, pay a lot less and get a health service that, according to the data, works at least as well as that in the USA and, in some cases, delivers better outcomes.

That said, there is still a lot of room for improvement in the NHS. The recent increase in spending has not always translated into improved performance. But the OECD data suggest that looking to the USA for ideas on how to improve the NHS, as our politicians all too often do, would probably not get us very far. I’m more interested in a country much nearer home. Finland has a similar life expectancy, a much lower infant mortality rate and more doctors and nurses per head than the UK, yet it spends even less proportionally than we do. Perhaps that is where the next government’s health ministers should be looking for inspiration as they work out how to get the NHS to do even more with even less.

Update: My comments about bloggers not picking this up were, perhaps, a little unfair. Liberal Conspiracy’s Nosemonkey is on the case too.

Update 2: Chris Dillow has posted about the OECD figures too – but then, you’d expect that, wouldn’t you?

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10 Responses to The NHS – as good as US heathcare but much much cheaper

  1. jameshigham says:

    Oh my goodness. This is so wrong. It takes massaged figures and presents them as fact, Rick and does not address what is really wrong with the NHS – its primary care.

    However, don’t take my word or that of the other 30 million or so. I’m running a poll now on what people think and then I’ll come back in with that info and do a post of how the NHS really is.

  2. Rick says:

    So let me get this right.

    You are accusing a highly respected international organisation of massaging figures while presenting an online poll on your blog as some kind of objective analysis.

    Have you any idea how ridiculous that sounds?

  3. jameshigham says:

    Rick – are you seriously suggesting OECD figures can be given credence? And you speak of ridiculous?

    One example: [p159]

    We could trawl around the world and put another dozen examples in here. The issue though, is not the actual figures but who then selects from them to prove a particular point. The OECD is in no position to see the NHS at ground zero but gives an overview on the basis of supplied data.

    Now that data itself is often corrupted and politically motivated – no one seriously disputes this and so the question is “which data”, “how applied’ and for “what conclusions”. e.g.

    You’ve heard, lies, damned lies and statistics. So no, it is by no means ridiculous but to hang on those stats above as having some sort of reflection on the state of the nHS in England is, quite frankly, naive.

  4. jameshigham says:

    Rick, despite my previous comment, let’s see how people feel in general about it all and maybe the truth is somewhere in the middle. I’m running a poll just now and I’ll link to this post in a post on the Russian system I’m currently doing.

    It would be ncie to hear what everyone says.

  5. Marek says:


    I agree with you that the current debate about healthcare systems is desperately devoid of meaningful facts. I am glad – and would certainly hope – that the NHS has saved, or bettered, the lives of many people in this country. And I am sure many people in America could say the same about their private health insurance system. So the extracts from the OECD report are welcome.

    That the US Government alone spends more per capita on health than ours really surprised me. I had always assumed that the enormous difference between our per capita health expenditure and that of the US could be accounted for by the costs of their private health insurance system. I, too, would like to hear some theories as to why this may be. I am not familiar with their system but will throw a couple of ideas into the pot.

    But first, a brief diversion to reply to the previous poster who has concerns about the statistics used and gives some links to try to support his argument.

    “Lies, damned lies and statistics” – this argument often goes like this: “as it is possible to make mistakes when collecting data or to draw misleading conclusions when analysing data I will therefore discount as unreliable any data or graph presented to me – ever. Particularly if it does not support my own views.” Hmm. I think one would need to point to a specific flaw in the data collection or method of analysis before dismissing the OECD data.

    Which brings me on to:

    “The OECD is in no position to see the NHS at ground zero but gives an overview on the basis of supplied data”
    If there is a suggestion here that the NHS might massage the figures to put itself in a better light why would any other healthcare system be different? Indeed, it could be argued that it would be in the NHS’s interests to massage the figures to make them worse in order to secure greater government funding.

    Interestingly, two of the OECD figures chosen by Rick show the UK has greater life expectancy and lower infant mortality than the US. Whether or not someone has undergone successful surgery to remove chronic back pain might be open to interpretation – or some degree of manipulation – but death tends to be easily spotted and recorded. A handful of lost death certificates aside, I think we can take these figures as being accurate i.e. despite the huge sums being spent, the combined public and private US healthcare system is slightly inferior to ours on two very basic measures.

    But the biggie for me is why their public health expenditure is higher than Britain’s. Some thoughts as to why this might be (caveat: this is a priori thinking rather than empirical – I don’t know the system and am throwing these ideas out there):

    – the uninsured are less likely to seek medical help for seemingly minor complaints and therefore are at greater risk of developing serious illnesses which ultimately require greater expenditure.

    – The Medicare system provides better – and more expensive – care for the elderly than Britain. (Again, no idea if this is true but it is a possible reason.)

    – A smaller percentage of Americans care for the elderly at home than they do in Britain with the result that the US government picks up the tab. (100% speculative this one)

    – The US is huge and cannot centralise its government healthcare system in the way that Britain can. There is therefore greater duplication of administrative functions.

    – Proving you are entitled to receive free healthcare in the US is more costly than it is in Britain.

    – All the statistics are wrong because they have been manipulated by crypto-communists in a worldwide conspiracy against the utopia of private healthcare.


  6. Rick says:

    James, if that’s the best you can do to attack the credibility of the OECD its pretty poor. None of those stories shows that the OECD massaged figures. One simply says that they failed to check inconsistencies.

    The general picture of healthcare across different countries in the OECD report is corroborated by the WHO and by a recent PwC report.

    Opinions on whether or not the NHS is crap are not worth a jot. No public service is ever perfect and if you say something is crap, you have to ask the question “compared to what?” When you ask that, the data show that the NHS doesn’t shape up too badly when compared with health provision in other developed countries.

    Marek – this PwC report indentifies high levels of waste in the US healthcare system which may account for some of the high cost.

    Then again, maybe your last comment is right. Perhaps the OECD, WHO, PwC and all are just part of a massive communist conspiracy. 😉

    • Marek says:

      Interesting link. Although I would say a consultancy has a vested interest in finding waste (“We can help you there, guys!”), I think the 3 areas identified are good points. One of the categories of waste identified in the US system is “defensive medicine” – unnecessary tests and procedures. Say what you like about the NHS but I’d say very few patients ever have the fear the procedure they are undergoing is an arse-covering exercise.

  7. Rick it is a Excellent site, keep up the good work. I read a lot of blogs on a daily basis and for the most part, people lack substance but, I just wanted to make a quick comment to say I’m glad I found your blog. Thanks

  8. Rodney says:

    The suggestion that the NHS is a bad thing compared to private healthcare systems that charge much more to the public for care and then bankrupt you for operations to save your life (and thus ruin your quality of life thereafter) is a ridiculous one. Sure, the NHS is not perfect, but it’s much better than the alternatives.

  9. BL Weible says:

    Another reason that health care costs in the US are high is that our hospitals expend billions each year to care for people in the country illegally…

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