Comparative Analysis of the US Healthcare System and Canada - Case Study Example

A Comparative Analysis of the U.S. and the Canadian Healthcare System Introduction Healthcare reform is a very critical issue in the 21st century for all developed and developing nations today. The growing awareness among people regarding health, fitness and health care has further necessitated the need for updating and reforming the national healthcare policies to stay abreast of the globally accepted standards. And in such a scenario the nation that faces the utmost need for reform in its healthcare system is the USA. Though economically one of the global leaders, US remains far behind its contemporaries in this particular realm. Economists and healthcare experts worldwide have suggested that Canada’s healthcare system can be looked upon as a possible model for the US in this regard. The two countries, though culturally very alike, share a vast range of dissimilarities when it comes to their healthcare policies. The prime appeal of the Canadian system lies in the fact that it does much more for much less. It offers complete access to health care for all its citizens, by spending only 10.4% of its GDP. In contrast, over 20% Americans are uninsured despite the fact that the US government spends 17 of its GDP on healthcare. (World Bank data, 2014) This paper aims at presenting an in-depth analysis of the performance of the U.S. and the Canadian health care systems, with the purpose of exploring whether the Canadian system provides better healthcare services in terms of equity, affordability and quality when compared to the U.S. system. 2. Comparison of the Structure and Functioning (a) The US System Over the past few years, the rank of US has seen a sharp decline in world health statistics. For instance, the US stands at the 28th position globally with respect to the rate of infant mortality. In 1996, majority of the US citizens felt that their healthcare system was fallacious, and it was motivated by profit interests rather than by the quality of healthcare. Today, most of the Americans feel that an average earner cannot at all afford the healthcare services, as they cannot go on paying more for their healthcare services or health insurance policies. This can be attributed to the recent financial crisis and the resulting unsteady employment rate in the US. Small firms drop their employee insurance coverage during recession to survive the crisis and to maintain funds for staff salaries. In most of the cases, the insurance premium is raised which further pushes up the healthcare costs. For instance, in 2007, the employer health insurance premiums were increased to 6.1%, as a result of which the annual premium for a four-member family shot up to $12,000. Moreover, loss of job automatically leads to the loss of health insurance benefits. It has been studied and estimated that every 0.5% increase in unemployment rate leads to the loss of health insurance coverage of approximately one million people. (Martin, 2011) The total expenditure of the US on healthcare was $2.3 trillion in the year 2007, rose to $2.6 trillion in 2010 and is expected to touch $4.2 trillion by the year 2016. In this, more than 10% of the costs are accounted for by the prescription drugs, 31.4% by hospital care, 5.5% for nursing home care and 19.9% by the physician and clinical services. The healthcare expenditure formed 17.9% of the Gross Domestic product in 2011. The per capita expenditure on healthcare was almost $ 8,608, which formed over 15% of the gross national income per capita in same year. In spite of these, the number of Americans who do not have a health insurance is over 47 million, of which more than 20% are children. (The WHO website, 2014) (b) The Canadian System The Canadian healthcare system was established by the Canada Health Act which was adopted in 1984. According to the Act “the primary objective of Canadian health care policy is to protect, promote and restore the physical and mental well-being of residents of Canada and to facilitate reasonable access to health services without financial or other barriers.” (Canada Health Act, 1984: Section 3) For the most part publicly financed, this system is a single-payer system, consisting of thirteen provincial and territorial health plans. These regional plans are interconnected in terms of their compliance with the national principles laid down at the federal level. The Canadian government offers healthcare policy on a prepaid basis to all its eligible citizens, with no direct charges levied at the point of service. As a result, the Canadians have an equitable access to all sorts of health insured services. The role played by the federal government of Canada is very crucial in the smooth operations of its healthcare system. The federal government if the sole authority that lays down as well as implements the national codes or criteria for the insured health care services. It enables fund transfers to extend financial assistance to the provincial and territorial health care services. It arranges for direct health care services for certain niche groups of the nation such as the First Nation persons, federal prisoners and military personnel. Apart from all these direct functions, the federal government also gets involved in various allied activities like health promotion, health protection, and disease prevention. (Senate Committee Interim Report, 2001) 3. Comparison of the Basic Underlying Principles (a) The US System In the 1990s the World Health Organization had proposed its “Health for All” vision which promoted a set of principles such as justice, harmony, sustainability, integrity and human rights.  Majority of the nations worldwide had endorsed the vision and accommodated the same in their respective healthcare policies. But USA remained out of the league. It did not conform to the broad global values on healthcare and continued to align its healthcare policies to its own conventional structure and assumptions that widely differed from those of the other developed nations. In this regard, a very interesting revelation is made by Dr. Marc Nuwer, leading expert on national health care reform and a professor of clinical neurology at the David Geffen School of Medicine at UCLA. Nuwer writes: “Americans prize individual choice and resist limiting care… We believe that if doctors can treat very ill patients aggressively and keep every moment of people in the last stages of life under medical care, then they should. We choose to hold these values. Consequently, we choose to have a more expensive system than Europe or Canada.” (Nuwer, 2008) The principles that rule the American society and the day-to-day lives of the Americans include heterogeneity, individual accountability, disbelief in the government, fear of monopoly, spirit of competition, technological progress and penchant for innovation. The US healthcare system too is governed by the same cultural values. The individual is solely accountable for procuring his health insurance coverage, and the employer is not legally bound to offer health insurance. The people who are deprived of health insurance either live without it all their lives, or can avail of the hospital emergency rooms for their health care. Availability, desired quality and innovation are ensured by the presence of free markets in healthcare industry. The government, however, has no major role to play as the industry is too complex for the government to manage effectively. In simpler terms, the healthcare system of the US is thriving on the cultural values of the natives who prefer treatment, medicines and technology over a healthy lifestyle and preventive measures. (Institute for Alternative Futures website) (a) The Canadian System The healthcare system in Canada is directed by the global values that prevail worldwide in the realm of health care. These principles include valuing health care as a right for all, equity in the distribution of health care benefits, public administration of the health care policies, affordability and cost-effectiveness of the measures. In keeping with these conventions, the Canada Health Act too is founded on the pillars of public administration, comprehensiveness, universality, portability and accessibility. Health care in Canada is “administered and operated on a non-profit basis by a public authority, responsible to the provincial/territorial governments and subject to audits of their accounts and financial transactions.” (Canada Health Act, 1984: Section 8) Comprehensiveness entails that the health insurance plans must cover “all insured health services provided by hospitals, medical practitioners or dentists”. (Canada Health Act, 1984: Section 9) Universality ensures that all insured individuals within the province or territory have an open access to public health insurance schemes based on the even terms and conditions. This goes hand in hand with the tenet of portability that states that "Residents moving from one province or territory to another must continue to be covered for insured health care services by the "home" province during any minimum waiting period, not to exceed three months, imposed by the new province of residence. After the waiting period, the new province or territory of residence assumes health care coverage." (Canada Health Act, 1984: Section 11) And lastly, the access of insured persons to the necessary healthcare services must not be hampered by any barriers related to “age, health status or financial circumstances”. (Canada Health Act, 1984: Section 12.a) 4. Conclusion A thorough comparison of the US and the Canadian healthcare system would reveal a plenty of faults and gaps inherent in the former. The US healthcare system is redundant and obsolete when compared to the Canadian and the global standards. Not only does it suffer from a defective and deficient structural framework, but it also bears the negative influence of the conventional cultural outlook and thinking of the Native Americans. The basic attitude and approach towards healthcare carries a reluctant, complacent and indifferent overtone. For instance, surprisingly, a whole 31 percent of U.S. health care funds are devoted to administration and as Dr. Nuwer says: “We spend twice as much as Canada, which has a more streamlined health care system that demands doctors complete less paperwork.” (Nuwer, 2008) Besides, it is very shocking to know that only one-sixth of the Americans are insured despite the fact that healthcare is the economy’s largest sector. Ironically US government claims to possess the worlds most expensive health care system and incurs more than $2 trillion a year on medical expenses. But despite all the glittering facts and figures, the healthcare system of US still remains way below the Canadian system and the accepted global standards of quality, affordability and universality. This validates the thesis that the Canadian system provides better healthcare services in terms of equity, affordability and quality when compared to the U.S. system. Reformation of the U.S. health care system demands a reconsideration of the overall cultural values on the part of the public and being more thoughtful of the healthcare-related expenditure on the part of the government. US can remodel its healthcare system based on the examples set by other developed nations and also ponder over the succinct suggestion by Dr. Nuwer: “To heal our ailing health care system, we need to stop thinking like Americans.” (Nuwer, 2008) References: “2019 Healthcare That Works for All”.  Healthcare Values 2019. Institute for Alternative Futures. Retrieved from: http://altfutures.org/pubs/health/2019Project_ValuesforHealthcare.pdf Government of Canada. (1984). Canada Health Act. Retrieved from: http://laws-lois.justice.gc.ca/eng/acts/C-6/page-2.html#docCont Mahler, H. (1981). The Meaning of “Health for All by the Year 2000”. World Health Organization. Martin, A., Lassman, D., Whittle, L., & Catlin, A. (2011). Recession contributes to slowest annual rate of increase in health spending in five decades. Health Affairs, 30(1), 11-22. Nuwer, M. R., Esper, G. J., Donofrio, P. D., Szaflarski, J. P., Barkley, G. L., & Swift, T. R. (2008). The US health care system Part 1: Our current system. Neurology, 71(23), 1907-1913. Standing Senate Committee on Social Affairs, Science and Technology. (2001). Interim Report on the state of health care system in Canada. Retrieved from: http://www.parl.gc.ca/Content/SEN/Committee/371/pdf/interim-soci-e.pdf The World Bank. (2014).World Data Bank: World Development Indicators. Retrieved from: http://databank.worldbank.org/data World Health Organisation. (2014). United States of America: Data from Global Health Observatory. Retrieved from: http://www.who.int/countries/usa/en/ Read More