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Insight: Why dollars alone won’t fix US healthcare

You might assume that the vast sums the US spends on healthcare must produce better patient outcomes than the rest of the world – but often the opposite is true

Update, 22 March 2010: President Barack Obama last night forced his healthcare reform bill through Congress, passing it by a narrow 219 votes to 212.

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Video: US healthcare debate It will take more than just money It will take more than just moneyThe growth in US spending on healthcare has been driven by spiralling costs in some regions of the country. These maps show how spending by Medicare, the federal government scheme that provides health coverage for senior citizens, increased between 1992 (this map) and 2006 (next map) (Source: Dartmouth Atlas of Health Care)The growth in US spending on healthcare has been driven by spiralling costs in some regions of the country. These maps show how spending by , the federal government scheme that provides health coverage for senior citizens, increased between 1992 (this map) and 2006 (next map) (Source: )This map shows spending by Medicare in 2006, as compared to the 1992 figures shown in the previous map (Source: Dartmouth Atlas of Health Care)This map shows spending by in 2006, as compared to the 1992 figures shown in the previous map (Source: )

“WE’VE got healthcare that is better than anywhere else in the world,” boasted conservative US pundit Rush Limbaugh in an on 23 July. Many politicians have been echoing this claim in recent days, as Congress debates reforming the nation’s healthcare. Sadly, it is not true.

Compared to other leading nations, the US spends vastly more per head on healthcare, while often getting worse outcomes. Despite these high and rising costs, which have set the nation on course for bankruptcy, the US lags behind other countries on measures such as life expectancy at birth (see graph) and infant mortality.America's extravagant health spending has not translated into high life expectancy

People who have health insurance get excessive medical interventions, escalating costs so that tens of millions can’t afford it. Those left uninsured have minimal access to healthcare, and are likely to contribute significantly to the country’s relatively poor health outcomes. Even the insured could be sent to an earlier grave by risky interventions they don’t need.

Research at the Dartmouth School of Medicine in New Hampshire shows how of the country are driving the spiralling costs. Insurers and the government pay set fees for each medical intervention performed. In some regions, doctors in institutions that are competing to become “centres of excellence” in high-paying fields may use unnecessary diagnostic tests, and surgeons often perform expensive procedures when .

The main proposals now before Congress won’t do much to tackle this problem. Rather, they concentrate on the important issue of expanding access to health insurance, and the Congressional Budget Office calculates that they will increase spending by .

Cutting costs would involve more research into the comparative effectiveness of different tests and treatments, and giving doctors incentives to deliver quality care, not just paying them more for doing more.

Why the reluctance to tackle these issues? Partly it’s because no politician wants to be accused of rationing healthcare. One way forward might be to inform the public that sometimes less can be more. “When people understand, they’re less likely to choose expensive, invasive procedures,” says of the New America Foundation a think tank based in Washington DC.

Topics: United States