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Why Does the U.S. Spend More On Health Care Than Other Countries?

According to an article posted on Harvard’s website, the U.S. spent nearly twice as much on health care as other high income countries yet had poorer population health outcomes in 2016.

The Harvard T.H. Chan School of Public Health, the Harvard Global Health Institute, and the London School of Economics conducted a study comparing the cost of health care in the US to other countries in the world.

They explain that, “We know that the U.S. is an outlier in health care costs, spending twice as much as peer nations to deliver care. This gap and the challenges it poses for American consumers, policymakers, and business leaders was a major impetus for health care reform in the U.S., including delivery reforms implemented as part of the Affordable Care Act,” said senior author Ashish Jha, K.T. Li Professor of Global Health at Harvard Chan School and director of the Harvard Global Health Institute (HGHI). “In addition, the reasons for these substantially higher costs have been misunderstood: These data suggest that many of the policy efforts in the U.S. have not been truly evidence-based.”

The study that was published in the Journal of the American Medical Association found that:

  • 8% of total health care costs are due to Americans planning, regulating, and managing health systems and services, while other countries costs range from 1 to 3 percent.
  • America spend $1,443 per capita in the US, while other nations spend anywhere from $466-$939 per capita.
  • The average salary for a general practice physician in the U.S. was $218,173, while in other countries the salary range was $86,607 to $154,126

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What’s behind high U.S. health care costs

2024