Annual Per Capita Healthcare Costs By Age Essay

Custom Student Mr. Teacher ENG 1001-04 26 December 2016

Annual Per Capita Healthcare Costs By Age

The United States has way higher healthcare costs than any other country in the OECD, mostly which is because of the extremely high expenses later in life. 17 cents of every US dollar is being spent on health care. At about age 60, healthcare expenses for US citizens skyrocket, averaging between $40,000 to $45,000 a year per person, which is way above Germany, who has the next highest with only about $10,000.

Dr. Ficshbeck, an engineering professor who runs a website called, says the high costs are not completely without some reward. He said when it comes to deaths caused by disease, men from the US have a survival advantage over men from western Europe starting around age 65 that steadily increases over time. American women have this same advantage starting around age 80. This means if Americans died from diseases at the same rate as people from the Netherlands, for example, there would be about 60,000 more male deaths and 14,000 more female deaths in the US, all after the age of 70. France is among the few exceptions because they have a lower death rate from disease, but for the most part, the United States has a lower rate of diseased-caused deaths than Western Europe.

Dr. Ficshbeck’s research also shows evidence that Americans have a higher death rate during young adulthood and middle age mainly due to health. Obesity rates, which are one of the leading causes of type 2 diabetes, are 3 times higher in America than France, and more than twice as high as in Germany. This study could mean that American healthcare is not totally at fault for not producing better results, but the American people themselves should be to blame for not making better health choices earlier in there lives. Ficshbeck believes that the edge the United States is getting in the latter years are due to our superior screening and treatment of diseases, the most prominent one being cancer. Americans have an average 5 year survival rate for breast cancer. This is higher than any other country in the OECD.

Although Americans have a small advantage when it comes to death rates caused by disease for people over the age of 70, it isn’t a big enough advantage to prove that all of the money we spend on older American’s healthcare is providing that much of a survival advantage. A Boston University economist by the name of Dr. Lawrence Kotlikoff believes that the problem with our healthcare overspending problem stems from Medicare. He says the system has no cost control, and that pretty much any services that hospitals or doctors provide, Medicare will pay for. He has a very interesting idea for an alternative system that will provide incentive for practicing healthy habits (which the lack of proves to be one of main reasons for our not-so-superior life expectancy rates) and also lower US healthcare spending. He advocates issuing everybody vouchers through health insurance companies that would vary in value depending on the receiver’s health status, kind of like how car insurance companies are run.

This sounds like a great alternative in that it would give people a good reason to be healthy which, in turn, would lead to less money being spent on expensive tests and procedures.  Robert Martensen, director of the office history at the National Institutes of Health is skeptical of how much of the United States’ health care spending is actually going towards increasing lifespan. He says that 40 to 50 percent of Medicare is being spent on intensive care which may not necessarily increase their chances of survival. European countries spend a lot less after the age of 65 mainly due to the fact that they have a lot more general practitioners, fewer specialists, and more centralized control over the number of hospital beds.

Another researcher, named Dr. Jonathan Skinner, believes that although the US may be spending too much on older people’s health care, Europeans may also be doing too little. Having a specialist for every organ in the body of a patient with a chronic illness is a big part of the reason Americans are overspending. A payment technique called “bundling” could be a solution to this problem. It suggests that doctors and hospitals be paid a set amount for each patient diagnosis, such as diabetes or heart failure, and then have the ability to be rewarded with additional payments for meeting certain standards for quality care.

This will give the doctors more control on what they should be spending their money on, so if they deem it unnecessary, they won’t have to “waste” money on specialized care for a patient. The problem with bundling and the reason many physicians are against the idea, is that a doctor can’t always know ahead of time if they shouldn’t spend money on a patient. Although the US is spending way too much on Medicare, that’s not a decision any doctor wants to be in control of.

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  • University/College: University of California

  • Type of paper: Thesis/Dissertation Chapter

  • Date: 26 December 2016

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