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High Costs Don't Equal Better Quality

One might expect that greater health care spending in the US is also linked to greater capacity and better quality. However, quite the opposite is true. Hospital capacity and the number of health professionals per capita are lower in the US than most other OECD countries.[1] The U.S. ranks in the bottom quartile of hospital beds per capita and the US nurse per population ratio is also below the OECD median.

Recent studies also show that higher costs don’t result in greater quality of care.[2] A recent New York Times article highlighted the results of a Pennsylvania government study that showed how hospitals with differential amounts of funding produced relatively similar health care outcomes.[3]

In addition, the Commonwealth Fund’s National Scorecard on Health Care also found little systematic correlation between higher costs and higher quality in the US health care system. Furthermore, the national study indicated that higher costs were often associated with inefficiencies that could be limited by changes in the system of health care finance and delivery.[4]

OECD Comparison: Life Expectancy at Birth - Total

Source: OECD 2007 Factbook, 24 July 2007 <http://fiordiliji.sourceoecd.org/vl=8818973/cl=17/nw=1/rpsv/factbook/11-01-01-g01.htm>.

Number of years, 2004 or latest available year

Statlink : http://dx.doi.org/10.1787/536256868442

State Ranking on Potentially Avoidable Use of Hospitals & Costs of Care Dimension

Source: “Aiming Higher: Results from a State Scorecard on Health System Performance,” The Commonwealth Fund Commission on a High Performance Health System, June 2007: p. 31, 23 June 2007 <http://www.commonwealthfund.org/usr_doc/StateScorecard.pdf?section=4039>.