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Of guinea pigs, Canadian and American

All animals are equal, but some animals are more equal than others

Hamsters being a prominent theme at the moment, here's a thought you might want to think on [or not] -- for a couple of generations now we've all been guinea pigs in a huge medical experiment. Having [cough] borrowed the graphic from YES! Magazine, I'll go ahead and lift the opening paragrapghs of the accompanying article as well.

Should the United States implement a more inclusive, publicly funded health care system? That's a big debate throughout the country. But even as it rages, most Americans are unaware that the United States is the only country in the developed world that doesn't already have a fundamentally public--that is, tax-supported--health care system.

That means that the United States has been the unwitting control subject in a 30-year, worldwide experiment comparing the merits of private versus public health care funding. For the people living in the United States, the results of this experiment with privately funded health care have been grim. The United States now has the most expensive health care system on earth and, despite remarkable technology, the general health of the U.S. population is lower than in most industrialized countries. Worse, Americans' mortality rates--both general and infant--are shockingly high.

The article goes on to detail how 35 years ago Canadians and Americans were equals in health status, the amounts they paid for health care, and the methods by which they paid. But the Canadians, like all other civilized countries [and some not-so-civilized], figured out that the much-vaunted private market was delivering a lousy product.

There are a number of systems for publicly funding health care [more on those in a future post maybe]. The Canadians chose a national health insurance model and implemented what we've been calling 'single payer' -- where the government is the one and only entity that manages the money in the insurance pool and pays out as needed.

Canada's isn't quite single payer, actually. Each province/territory is its own payer, making their system an amalgamation of 10 single payers. Nor did the whole country switch at once. In the 1960s Saskatchewan made the leap, and by the 1970s the rest of the country wanted what they had, so in the 1970s all of Canada switched over to Medicare, which works pretty much just like our Medicare, except that in Canada everybody can go to the doctor, not just the old folks.

The transition was not a smooth one. Rioting broke out in the streets, doctors went on strike, and predictably the blood-sucking, money-grubbing insurance companies refused to give up the fight gracefully. Tommy Douglas, the Premier who was back then vilified for trying to bring socialism to Saskatchewan, was in 2004 voted The Greatest Canadian of all time. The current crop of Presidential candidates should take note.

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Rain's picture
Submitted by Rain on

It did not come easy. eg in Australia, a newly elected federal govt brought in Medibank national insurance in 1972, but it was dismantled only 3 years later, by the Opposition Conservative govt Party returning to power.

Was not until 1983, when the centre-left Party regained power, that Medicare was introduced for a second time, and it was like Canada, and other countries - almost blood-in-the-streets, from doctors, hospital consortia, to drug and insurance companies etc. Even so, there were some compromises with doctors, such as allowing doctors to charge co-payments on non-hospital doctor's clinic visits.

It was not a popular move, and the mandatory 1.5% income tax hike (or Medicare Levy) on all income-earners was very (very) unpopular.

Really unpopular. Here is a vid-clip of the original Public Service govt ads, the fellow in the ad was the newly elected Prime Minister of the day:

Funny how quickly people can change their minds though.. despite the years of pain and grief, rhetoric, fear-mongering, drama, protest, argument and struggle, within 2 years of its introduction, no drama at all - once people saw it actually working, so much better then before - and the sky didn't fall in, and by the next election term rolled around, Medicare became National Sacred Cow.

Doesn't mean it doesn't have its own problems, some very serious ones too, and doesn't stop people complaining bitterly about it, and still makes headline news at election times.

Until someone mentions, comparing it to the USA's system ... and then they all STFU.... until the next scandal LOL :)

Unlike Canada however, some countries have more "mixed" systems - Australia for example, kept a small, but highly regulated, private health insurance sector, for "extras" or "top-up" cover - like private rooms, or in fancy private hospitals etc, choice of treating doctor and ability to "jump the queue" on public-hospital surgery waiting lists, and for things that Medicare wouldn't cover, eg cosmetic surgery.

One such insurance company was established by the govt, known as Medibank-Private, with all profits returned to govt as revenue rolled in with taxation revenue. They started advertising their plans, along the lines of "When Medicare isn't enough..."

But the private health sector became highly regulated with national clinical standards, on quality of product and payout determinations, (no more litigation - the law is the law, for all services and procedures) NO cherry-picking, no discrimination on pre-existing conditions etc, and mandatory cross=insurance underwriting, or industry-wide risk=sharing arrangements.

As a health economist, recently working with OECD Health directorate, my understanding is that it would not be possible for the USA to go to single-payer or even a "mixed" system in one fell swoop. Far too much disruption to various related industry sectors, and would need to be phased-in step-wise, over time, through some form of 'Mixed" system.

My understanding of the Clinton/Edwards plan is to take a first baby-step to transitioning, or phasing-in, by firstly regulating the health insurance companies. Enforcing mandatory coverage, for starters, provides great leverage on the companies. Mandates on people, also means mandates on the companies. Can't have one, without the other.

Obama's plan is corporate welfare. Subsidise some extra people to take out insurance, but that gets paid to the companies, with nothing in return. Just means more people are covered with the same crap coverage that Americans are already complaining about. If you read the fine print of his plan, its all based on "voluntary compliance" with industry standards, and "optional" buy-ins by insurance companies etc. Similar to all the "voluntary compliance" clauses he made for Exelon on the nuclear leaks legislation.

With mandates, to operate their business, they will need to comply with regulation on national standards on things for example: portable products, risk-sharing arrangements with all the other companies in the sector, no cherry-picking, no discrimination etc, no special deals with certain hospitals, the list goes on, mandatory reporting against industry-wide criteria - ie they will have to compete on a level playing field on basic product standards set on clinical benchmarks, as agreed with national clinical schools of medicine.

Add to the competition in the market-place with a government-owned insurance company, and people will shop around for the best deal, and over time people will probably move to the government insurance scheme, and mergers and restructuring will happen slowly in the remaining private sector. In the end, those that can offer the best quality insurance products, on price and quality of service, consumer trust and goodwill, will survive and do well, but in a smaller market.

I can well understand why there is so much resistance in the USA's corporate world to this sort of regulation.

Because, the other issue, that several OECD countries are watching the US elections for - is very much focussed on how the US moves with their "corporate" healthcare debate.

In simplistic economic-speak, the US-based HMOs are now operating in a "saturated market". Basically, this means Americans are paying as much as they possibly can, they've been bled dry, can't bleed any more - and the only way the HMOs can survive is to expand internationally. Laissez-faire capitalism 101 - bleed one market dry, then aggressive expansion into new markets. Obama's partial subsidisation, as corporate welfare without regulation, greases the wheels of this process, by increasing their operating capital.

Similar to US-based drug companies, they are pressuring other countries, which are struggling to "hold the line" on their systems. Little by little, a co-payment here, a deductible there etc, in recent years, allowing freer market access for private health insurance companies to open up offices under 'Free Trade Agreements' etc. In short, welcome to globalised Mc-BlueCross healthcare.

Submitted by hipparchia on

there are corporatists in both france and canada salivating over the possibility of privatizing those systems, at least partially. quebec has allowed some privatization, and i can't remember for sure, but i think i read somewhere that sarkozy might be in favor of further privatization [france allows some private supplemntal insurance]. the british nhs, true socialized medicine, has been partially privatized, with queue-jumpers happier and everybody else more exasperated.

bringiton's picture
Submitted by bringiton on

The one embedded doesn't show.

Suppose there's truth to the rumor that these differences are product of 400 years of natural selection? I've stood on the corner of Portage and Main in January; those winters up North surely could cull the weak.


Submitted by hipparchia on

but thanks for re-posting it for me. i'll get this html stuff figured out eventually.

i've got scads and scads of links to dollar amounts, quality of life measurements, blahblahblah, for like the whole entire world, and i'm wading through them at dial-up speeds...

anyways, about 35 years ago, canadians and americans were closer together in those 3 metrics, and now, after 35-ish years of paying for health care services differently, they're pulling slightly ahead of us. and they're doing that with only about 60% of what we're spending.

Submitted by lambert on


Originally from here.














[x] Any (D) in the general. [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

Submitted by hipparchia on

that exact post was what turned me into one of your dedicated lurkers [i followed krugman's link to it. in fact that's when i started reading your blog more often than i read his.]

i'm still a tiny bit miffed that you didn't let me inside the doors of the mighty corrente building until after the brouhaha over that anti-hillary ad in spanish had died down. probably it's just as well that you didn't.

Rain's picture
Submitted by Rain on


thats one explanation :) Canuck winters are character-building, put hair on your chest, or strip it off, as the case may be!

But some differences in the population averages. The US has much larger proportions of poverty pockets and dense urbanisation, and across what is I think the 3rd most densely populated country?

eg in Australia there is a 17-year difference in life expectancy between Indigenous native groups, and non-Indigenous groups. But Indigenous population makes up around 0.1% of total national population, so is washed out in national averages.
When your poverty pockets are a much higher percentage of total population, say 5-10%, it will bring down the national average.

OECD Health stats, tend to use standard socio-economic quintiles to compare, poor urbans with poor urbans, rich with rich etc. Even then, the USA is often excluded because - well, its just incomparable, LOL. Just last month the annual batch of country health stats data was delivered to my office, and the database manager yelled "Don't forget to delete the US stats until they've been standardised, last year we forgot and the whole planet was dying in droves!"

Submitted by lambert on

I certainly feel I'm being educated on this.

[x] Any (D) in the general. [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

bringiton's picture
Submitted by bringiton on

Big effect. Seen this report from April?

Sitting on my to-do list for a post, keeps getting pushed aside for politics. I've been a hit-whore. Shameless.

Oh and, thx hipparchia for this post, interesting article.

Submitted by hipparchia on

but didn't have a link to it. thanks.

i'm going back through all the posts that i've got on this stuff at my blog, trying to decide which ones i should inflict on y'all. maybe we could have a race to see who doesn't get around to posting first on this article. :-)

Rain's picture
Submitted by Rain on

Textbook accuracy too, I'm impressed :)

The 'social health gradient', sometimes called the socioeconomic gradient, or slope of the line between rich and poor populations.

If you are interested in this sort of thing, you might try searching on terms like "Social Determinants of Health" - there's a classic known as the "Whitehall Study".

Or for a fellow by name of Marmot, Michael I think, a few years back he did a reasonable inter-country study between USA and UK populations at:

href="">journal article

chicago dyke's picture
Submitted by chicago dyke on

the truth right there for all to see. does anyone have something similar, re US Af-Am health stats vs. First Peoples in canada? something like that would help clarify 'how much better' the canadian system really is. but gosh, just on the averages, the answer is obviously: A Lot.

jackyt's picture
Submitted by jackyt on

"The US has much larger proportions of poverty pockets and dense urbanisation, and across what is I think the 3rd most densely populated country?"

Universal Health Care, and Universal Public Education, among other social safety net programs work to ameliorate the effects of poverty.

Living (and paying taxes) in Canada I believe I get good value for my tax dollars. When have you ever heard an American based American say that?

chicago dyke's picture
Submitted by chicago dyke on

we're so saddled with idiot 'libertarians' and their pitiful 'ideology' of "fuck you, i got mine." it's pathetic and there are days i worry that will never change. another great depression may do it, but i wish something else could too.

Rain's picture
Submitted by Rain on

You're right jackyt, I've spent much of my adult life abroad and the health care is the biggie that hits me every time I go home. Drives me insane having to cover myself for however long I'm going home for, and with my folks getting older its a worry. Doesn't help that I work as a health economist/statistician :)

And you're right that accessible affordable, universal health care does help to ameliorate the impacts of poverty. Evidence is overwhelming, and has been for decades. Hipparchia's article is right, every other indistrialised country does use the USA as a kind of 'negative control' comparator.
Nice huge population to study, with plenty of perfect comparison points.

But it should also be noted, its not just the poorest in the USA, that study I linked to above, shows even the richest Americans are significantly less healthy than their British counterparts, when matched for age/sex/race/income/educational level. And the same statistical difference in poorer health status across all matched socio-economic points.

Not just the health care being accessible, but because when it is govt funded/managed - its in the govt's interest to reduce costs on the tax-payer by investing in whole-of-population health prevention,(like diabetes/AIDS etc), eg public education/information campaigns, and in regulating prices, supply and demand economics.

One of the biggest indicators, is actually educational status, more than income - poor Europeans with poor education know a lot more about managing their personal health etc than poor Americans do. Probably because Europeans do invest more in public health education campaigns targetted at, for example, drug users, street people, youth, antenatal care for single mothers on welfare etc - and of course, they spend more in paying people like me to crawl through numbers, looking for cost-savings! /chuckle

When tax-payers pay for it, its in your interest to reduce AIDS transmission, or high-blood pressure, diabetes etc. Its in the govts interest to have people be well-informed/educated on such matters, to know when to get a prescription for an antibiotic, long before they end up with pneumonia and need hi-tech hospital care. Teach the kids about nutrition and exercise before they get fat. Target the 45-year-olds about the problems of middle-age/seniors before they get too old and too sick, public service announcements on "Becoming healthy seniors"..the list goes on.

The thing with public funding, even partially, is you take the profit motive out of the equation, and see it primarily as a cost. And demand drives it, so you have to manage demand and supply as well. Manage demand by helping people to stay well in the first place, and manage supply by placing limits on what you get, and when you get it - ie You only get what you need, you may not always get what you want.

It works OK everywhere else, and they had to fight and struggle against the heavy-duty corporate greed machines in order to do it - and, its long past time the USA got with the program here,
and while we're at it - can we go metric too? (Another thing that drives me nuts when I go home)

Submitted by lambert on

Except for "little people." Because that's what this translates into for me:

.... every other indistrialised country does use the USA as a kind of ’negative control’ comparator.

Yes? I'm glad that my premature death helps you set your baseline!

[x] Any (D) in the general. [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

bringiton's picture
Submitted by bringiton on

You invest in universal health care becsue the return on investment is so favorable. Prevention programs, no link at hand but Rain has one close no doubt, save something like $10 of future cost for every one dollar expended. From a government standpoint, healthy, happy, secure people are easier to manage. From a business standpoint, they are more productive.

Win-win-win, so WTF? Concentrated $$$$$, that's all. And no I don't buy the BS about having to phase it in because of too much disruption and job loss. Compared to NAFTA? That's sorted itself already with no real help; if we put out some money for job retraining and funded an agressive realistic alt energy program, there'd be plenty of jobs for accountants and analysts.

We need to INVEST in single-payer universal healthcare, now.

[Oh and. It isn't capitalism that's the problem. Our current difficulty is from unconstrained capitalism, what is actually a system of Plutocracy using capitalism as a vehicle. Cure the disease, don't kill the body.]

Rain's picture
Submitted by Rain on

Yes? I’m glad that my premature death helps you set your baseline!

Hey? I'm still US born/raised in Maine (if little-staters still count!), but my mom's Canadian, and she hassled us kids to get dual citizenship when we were old enough, "just in case". I just work a lot for foreign government health service agencies. They pay health economists better - and then I met an "alien resident" when we worked together in DC (for the US govt) in 2000, but, who after 2 years living stateside, didn't want to stay in the states: "Beautiful place to visit, but who wants to live here unless they have to?" she says. Especially somewhere like DC, or even Maine, for which I can't really blame her. Even so, I'm home part of every year, sometimes just to visit the folks, sometimes for work.

Back to healthcare, I'm OK with the idea, trying to go in one fell swoop to single-payer - but can't see it happening. Too complicated, with different health sectors doing it such different ways.

Hospitals, consortia manage different ways, with contracts with suppliers, drugs, equipment, cleaning, catering, doctors, nurses, other health professionals - some on salary, some on fee-for-service arrangements, some on mixed. Different state governments have different schemes for this, that the other. Wholesalers and shipping companies, supplying surgical dressings for hospitals etc - IT databases and record-keeping systems all incompatible with each other, manual records systems have to be changed over. An enormous project to national standards, clinically and administratively, and an enormous task - and for such a very large country. The job losses etc is the smallest and easiest part of it. It needs to be project planned and staged in steps. Like the Apollo missions.

Then there's the inevitable resistance, from all sorts of players in the system. As Hillary says, it aint gonna happen overnight. And if Obama or McCain win POTUS, it wont even get started, but thats just my view.

Submitted by lambert on

I meant the institutions and people who live in sane systems. Irony....

[x] Any (D) in the general. [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.