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Jun 15 2009, 10:49 am

In Health Care, Do We All Lose to Singapore?

As the health care debate boils over this summer, one meme sure to be be stirred into the stew is the frequently recited fact that Americans lead the world in health spending but have no similar world-leading claim to life expectancy. In fact, we rate 50th out of more than 220 countries with an average age of 78. But as the graph after the jump shows, the disconnect between health spending and life expectancy isn't unique to America.

Here's the graph provided by CNN that shows pretty convincing that a nation's health expenditures are a pretty poor indicator of life expectancy around the world.
560 healthcarespending.pngOne conclusions that is often drawn from graphs like these is: the UK has an publicly-run health care system that would make Newt Gingrich's head explode, but they still have higher life-expectancy. But the real winner of this graph seems to me to be Singapore, whose long lives and small health expenditures are the envy of the world. As EconLog puts it, Singapore "makes Europe look like the United States."

But there's a problem with turning Singapore into a sexy pin-up for health care wonks: it breaks a lot of rules. Conservatives should hate it because the government regulates supply and sets prices and forces all its citizens to put money into a health care savings account. More liberal reformers should be irked by its famously high co-pays to help the government recoup money, because too-high co-pays are supposed to discourage the less fortunate to seek preventative care when the illness can be more cheaply treated. As Watson Wyatt sums up, it's a bizarre combination of a public option and private special care where "the private healthcare system competes with the public healthcare, which helps contain prices in both directions."

When you take stock of the compulsory savings accounts, the mandatory payroll reductions and the copays, you've got something quite weird: A largely government-run program that is ultimately funded mostly by private spending. Indeed, as a percent of total expenditures, private spending on health is higher than the United States and three times greater than the UK and Japan.

Picture 6.pngSo where will Singapore fall in the health care discussion? Probably close to nowhere, unfortunately. Singapore is an extraordinary hodgepodge of health care principles, but it's also a city-state whose health care system is comprised of fewer than 30 hospitals. Still, perhaps it deserves a place in the summer-long blockbuster discussion that begins with "What are we paying for, exactly?"

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Comments (5)

The lesson of the first graph seems to be that with the exception of Cuba there is no correlation between life expectancy and medical spending. The second graph seems to validate the theory that the best way to lower health care spending is disintermediation which is the opposite of where the US seems to be heading.

Health care spending to life expectancy comparisons are a bit dishonest.

There are many factors contributing to death that are not related to health care spending. Accidental death is one, and that happens to be the leading cause of death among young males in the US.

Other causes include things like genetic problems and problems brought on by other factors. It's been reported that there's been an explosion in the rate of diabetes in the US. Asthma has also shown a big jump in incidence. Those increases have nothing to do with spending, yet decrease life expectancy. Both, of course increase health spencing

There are genetic factors. Blacks are much more prone to a certain type of anemia. Less blacks means less incidence of that anemia. Certain jews, like Ashkenazi, are also more prone to certain diseases. Hence, fewer of them means a decrease in incidence. Again, the aforementioned, and others, reduce life span but increase costs.

Physical size of a country and lower population density decrease life span. If it takes 2 hours to get to the nearest doctor or hospital, the odds of dying increase. If you live in the wilds of Alaska and have a heart attack, your odds are worse than someone in Manhattan. Yet, the cost of flying a medivac helicopter to get you in Alaska greatly increase the cost.

I've only touched on some reasons for disparities in cost to life-span ratios. There are many others

Current statistics on life expectancy and health care costs in Singapore reflect the experiences of the generation of adults that grew up in the post WW2 years. Today's older singaporeans grew up without the dietary excess and exercise deficiency that citizens of more industrialized places suffered, but they benefited from an efficiently run public health system that controlled the spread of epidemic diseases effectively. Young singaporeans today are increasingly exposed to risks similar to those experienced by their western contemporaries: unhealthy food and a sedentary lifstyle. It will be interesting to see how the singapore's cost and life expectancy data change as its post-industrialization generations grow up.

Young singaporeans today are increasingly exposed to risks similar to those experienced by their western contemporaries: unhealthy food and a sedentary lifstyle. It will be interesting to see how the singapore's cost and life expectancy data change as its post-industrialization generations grow up.

I don't think so. Young Singaporeans have access to clean water which the older generation did not have. Secondly, for Male Singaporeans they have 2 years of military service and reserve duty until they are 40 years old, which the older generation did not have to do. Secondly, the lifestyle of older generation of Singaporeans was not exactly active. Remember Singapore was a malaria infested trading port not an idyllic rural paradise. In Singapore you are moving from a active (factory work) / non-active (trading/clerical) to semi-active (sedentary but compensated by annual reserve training for men). Whereas in places like China you are going from very strenuous (ie manual farming) to active (sit down factory work). Singapore has very few overweight people (let alone obese). Fewer than China, Korea and Taiwan as a % of the population

"Shouldn’t we be trying to figure out how they do it?"
Sure - America could out-source all kinds of public policy to other nations that clearly (quantifiably and qualitatively) do things better. They could save oodles in public service salaries and all kinds of time and effort by copy-pasting systems that have been live-tested elsewhere.
Nice idea but in reality the US has always seemed resolutely against learning from other nations. Scandanavia, for example, does just about everything better and hardly in secret (even recovering from bank disasters) but the US is determined not to learn from them.
Perhaps it has something to do with how history is taught or some kind of nationalistic "not invented here" syndrome... .
Anyway, it's a consistent waste and I don't see why Americans should change habits now and start learning from Singapore (or anyone else).