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International Price Comparisons

By July 25, 2016Commentary

While a lot of the wailing and gnashing of teeth about health spending in the US focuses on utilization, we have long believed that the major problem is the unit prices for health services and goods, a belief which is buttressed by data revealed in the annual price survey by the International Federation of Health Plans.  (IFHP Survey)   The 2015 survey includes the US, Australia, New Zealand, Spain, South Africa, Switzerland and the UK.   All country data is from the private sector and currency effects are ignored.  Looking first at drugs, where we know we will see large differences, the blood thinner Xarelto averages $292 for a 30 day supply in the US, but only $48 in South Africa, $101 in Spain and $102 in Switzerland and $126 in the UK.  Humira, a big arthritis drug, costs an average of $2669 for a month’s treatment in America, compared to $1362 in the UK and $822 in Switzerland.  Similar examples are presented for hepatitis C, AIDS, cancer and MS drugs, with the same medications often costing two to three times more in the US than in any other country.

Diagnostic procedures show a slightly different trend, with the UK being the most expensive for some.  An angiogram is $2149 in the UK, $1164 in the US, and $1089 in New Zealand, but drops dramatically to $270 in Australia, $240 in Spain and $191 in Switzerland.  An abdominal CT scan averages $860 in the UK, $844 in the US, $483 in New Zealand, $383 in Switzerland and only $85 in Spain.  The US regains its price lead in MRI scans–averaging $1119, while New Zealand comes in second at $811, the UK is at $788, Australia at $215 and Spain a paltry $130.  Colonoscopy has an average price of $3059 in the UK (something odd here–maybe limited data or that it is a private plan price), $1421 in New Zealand, $1301 in the US and $372 in Australia.  Thinking about medical tourism?  Might want to head to Spain, lovely country, wonderful food, low-cost health care.

And what does a day in the hospital cost?  In the US it averages $5220, $4781 in Switzerland, $2142 in New Zealand and $424 in Spain.   Total hospital and physician  charges for most surgeries are much higher in the US.  An appendectomy, a simple surgery, is $15,930 in America, $8009 in the UK; $3814 in Australia and $1786 in South Africa.  Having a baby?  Combined delivery cost in the US is $10,808, $7751 in Switzerland, $5312 in Australia and $1950 in Spain.   Cataract surgery has a relatively similar price across several of the nations.  Knee and hip replacements cost several thousand more in the US, with a hip ranging from over $29,000 in the US to $6757 in Spain.  Cardiac surgeries are much more expensive in the US.  A bypass averages $78,318 versus$34,224 in Switzerland, $28,888 in Australia and $14,579 in Spain.  Even with the strong US dollar, our unit prices are generally much higher than costs in other countries.

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