Progressive Policy Institute Democratic Leadership Council HomeProgressive Policy Institute Home



The Institute

Events

Press Center

Issues
National Defense & Homeland Security

Foreign Policy

Economic & Fiscal Policy

Trade & Global Markets

Regional Issues U.S. Trade Policy The Globalization Debate PPI Trade Facts World Trade Organization Finance & Investment About This Project Energy & Environment

Health Care

Technology & Innovation

The New Economy

Work, Family & Community

National Service & Civic Enterprise

Quality of Life

Crime & Public Safety

Political Reform

Education


The Third Way



Eduwonk.com

Policy Network
About PPIContact UsPress CenterE-Newsletters

Trade & Global Markets
PPI Trade Facts

PPI | Trade Fact of the Week | January 17, 2007
Almost Half of All World Health Spending is in the United States


Editor's Notes: The PPI "Trade Fact of the Week" is a weekly email newsletter published by PPI's Trade & Global Markets Project. To sign up for a free subscription, click here. (Just make sure to check the box next to "Trade & Global Markets.")

Original links are included though some may have expired.


The Numbers:

Health spending as percent of GDP, 2004:

United States: 15.2%
Switzerland: 11.5%
Cambodia: 10.9%
Canada: 9.9%
Japan: 7.9%
Mexico: 6.2%
Africa: 6.1%
China: 5.6%
Russia: 5.6%
India: 4.8%
Pakistan: 2.4%
Congo: 2.0%

What They Mean:

World spending on health, according to the World Bank and the U.N.'s World Health Organization, was 10.2 percent of global GDP in 2003. This is the equivalent of about $3.7 trillion, or $500 per person. (The figure counts all money spent by governments, providers, and individuals on "preventive and curative" health services, family planning activities, nutrition programs, and emergency medical aid.) America's health bill that year came to 15.2 percent of GDP, far ahead of all competitors. So far ahead, in fact, that Americans accounted for nearly half -- $1.7 trillion of the total $3.7 trillion -- of the world's health spending.*

Health bills for the rest of the world stretch out between 2 percent and 11 percent of GDP. The figure for second-place Switzerland was 11.5 percent of GDP; third-place Germany came in at 11.1, and the United Kingdom 8.0 percent. Japan's 82-year lifespan is the longest of any big country, but it spends only 7.9 percent of GDP on health, half the U.S. rate. Among developing countries, Cambodia, Lebanon, and Jordan spend the most, with health bills at 10.9 percent, 10.3 percent, and 9.4 percent of GDP respectively. Elsewhere, China and Russia spend 5.6 percent each, roughly the developing-country average. India is unusually low at 4.8 percent. Typical figures for Latin America range from Mexico's 6.2 percent to 7.6 percent in Colombia and Brazil and 8.9 percent in Argentina. African health spending is also relatively high, at an average of 6.1 percent. Pakistan's 2.4 percent is the lowest figure for any big country; the lowest anywhere is Equatorial Guinea's 1.5 percent.

Most rich countries have government insurance programs; the United States' approach, of course, has been to use government programs for military veterans, the elderly, and the poor and rely on employers for most of the population. Nonetheless, the American government spends as much on health as most of its rich-country peers. The average rich-country government spends 6.7 percent of GDP on health; America's 6.8 percent is very slightly higher. The national health systems of Canada and Britain cost about 6.9 percent of GDP, and that of Australia 6.4 percent. Germany's government spends the most on health care at 8.9 percent of GDP, followed by Norway, Sweden, France, and Denmark. Burma's government spends least, at 0.5 percent of GDP.

* World economy figures are as much art as science. The WHO and World Bank figures for health spending deal in currency-basis GDP, which gives rich countries more weight than poor and middle-income countries. The alternative Purchasing-Power Parity calculation increases the weight of middle- and lower-income countries, and would leave the United States with $1.7 trillion of $5.4 trillion -- i.e. about 31 percent of health spending, as opposed to 20 percent of world GDP.

Further Reading:

In the United States:

What does America's high bill mean? Health care in the United States is more responsive and dynamic than in other countries, as higher prices enable the system to cater to patient desires for convenience and innovation. The United States also excels in treatment of some specific diseases, such as breast and prostrate cancer. On the other hand, American health care seems to waste more money than other countries, and is less effective with some kinds of care, such as transplants. The Commonwealth Fund compares health care in the United States, Canada, Australia, New Zealand and the United Kingdom:
http://www.cmwf.org/usr_doc/
ministers_complete2004report_752.pdf

More fundamentally, despite high spending, U.S. "outcomes" in some basic public-health indicators often remain mediocre. For example, a WHO list places the United States 30th of 192 countries in infant mortality. (The 6.0 per thousand rate is at the bottom of the rich-country range, and roughly comparable to rates in middle-income countries like Chile and Croatia.) Low rankings reflect in part failure to insure about 40 million people, and also failures outside health care systems per se: relatively high obesity rates, frequent road accidents, HIV incidence somewhat higher than the rich-country average, and other problems that insurers, doctors, nurses, hospitals, and pharmacists must address but can't prevent. The World Health Organization lets you compare 171 health indicators across 192 countries:
http://www3.who.int/whosis/core/core_select.cfm

How can we do better? PPI's Health Priorities Project has ideas and research on comprehensive reform, cost control, covering the uninsured, Medicare and Medicaid, technology, consumer empowerment, and more:
http://www.ppionline.org/ppi_ka.cfm?knlgAreaID=111

Elsewhere:

An NIH/WHO/World bank publication explains spending patterns -- Rich countries spend a larger share of their income on health, and also use government health programs and insurers more than poor countries. People in poorer countries spend more out-of-pocket:
http://www.ncbi.nlm.nih.gov/books/
bv.fcgi?rid=pih.section.310

Developing countries are getting more health aid from rich countries, foundations and private donors, especially but not only for AIDS and HIV. Laurie Garrett, in Foreign Affairs magazine, wonders whether the rise is more than some can handle:
http://www.foreignaffairs.org/20070101faessay86103/
laurie-garrett/the-challenge-of-global-health.html

Health ministries around the world:

Cambodia's health spending is the developing world's highest:
http://www.moh.gov.kh/

Switzerland is second only to the United States in health spending:
http://www.bag.admin.ch/index.html?lang=en

Jordan's ministry has health indicators, including the number of animal bites per year. (Alarming rise in Jerash, reassuring drop in North Ghor.):
http://www.moh.gov.jo/

Uganda's has information on HIV/AIDS, child health, hospital management:
http://www.health.go.ug/

Burma's Health Ministry has the world's smallest health budget:
http://www.myanmar.com/Ministry/health/







Search Tips 

Support PPI
Make an online gift
Get Email Updates
Learn More  

Print Printable Version of this Article

Send this Article to a FriendSend this Article to a Friend

Related Links Trade Fact of the Week Archives

Privacy Statementndol_ci.cfm?contentid=250168&kaid=106&subid=122Email GroupsJobsInternshipsSupportOur Publications

Site designed and managed by Beaconfire Consulting