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Published by McKinsey Global Institute.
The United States spends nearly $650 billion a year more on health care than other developed countries, even after adjusting for wealth, and outpatient care accounts for two-thirds of the higher-than-expected spending, according to a McKinsey Global Institute study released Jan. 16.
The study used data from 13 developed countries compiled by the Organization for Economic Cooperation and Development and developed a measure that adjusts health care spending according to per capita gross domestic product. The estimated spending according to wealth for the United States should be about $1.4 trillion, but in 2006 it was $2.1 trillion, according to the study.
Lenny Mendonca, chairman of the McKinsey Global Institute, compared the $650 billion in excess spending to the similarly priced stimulus package currently being considered by Congress.
Health Spending Hurts Employment.
"Effectively we've got a de-stimulus on the economy, that employers are paying a large portion of, that's holding back employment and other benefits every year," Mendonca said at a briefing Jan. 16.
The study found that outpatient care was the biggest driver of the higher-than-expected spending in the United States. Outpatient care, the largest and fastest-growing part of the U.S. health system, accounted for $850 billion in health care spending in 2006, according to the study. About $436 billion of the outpatient spending was above the estimated spending according to wealth, the study found.
The study identified several factors driving up outpatient care costs, including:
Mendonca said an effective health care reform program would have to address the misaligned incentives and the supply and demand issues in the system.
The United States also had above-estimated spending according to wealth in inpatient care (by $40 billion), drugs and nondurables (by $98 billion), and health administration and insurance (by $91 billion).
The study also found that Americans had a lower life expectancy and higher infant mortality compared with the other developed countries in the study. The United States spent the most per capita on health care at about 16 percent of GDP, the study added.
The report is at http://www.mckinsey.com/mgi/publications/US_healthcare/index.asp
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