When Americans think about health care, they don’t typically think “affordable.” A recent study from the Commonwealth Fund ranked the U.S. as the worst of 11 developed countries in terms of the overall effectiveness of health care. The high figures for health expenditures per capita in the U.S. showed a particularly troubling discrepancy. It’s no wonder that medical tourism is on the rise.
Many ask why Americans pay so much for health care, and some claim it is because the health care system in the U.S. is structured differently. However, when it comes to American health care, there are plenty of differing opinions out there. As researchers Gerard Anderson, Uwe Reinhardt, Peter Hussey, and Varduhi Petrosyan put it in the title of their influential 2003 study, “it’s the prices, stupid.”
The International Federation of Health Plans (IFHP) compiled data covering differences in medical prices by country in its 2013 Comparative Price Report. The organization’s annual report compares the total hospital and physician price (USD) of several routine medical procedures. In addition to these procedures, it also shows the price disparity for diagnostics and prescription drugs, which can be drastic. For example, the average price for cancer drug Gleevec ranges from $989 in New Zealand to $6,214 in the U.S. The report also shows the average hospital cost per day as $4,293 in the U.S. but only $481 in Spain and $702 in Argentina.
Tom Sackville, Chief Executive at IFHP, explained in a press announcement why he believes the data is so important: “First, it gives the lie to the idea that some countries spend more on health as a result of higher utilization. It is all about unit price,” he said. “Second, we have looked here at a number of procedures and products which are identical across the markets surveyed. The price variations bear no relation to health outcomes: they merely demonstrate the relative ability of providers to profiteer at the expense of patients, and in some cases reflect a damaging degree of market failure.”
Here are nine common medical procedures that are cheaper outside the U.S., based on data provided in IFHP’s 2013 Comparative Price Report. For each procedure, we list the average price in America, followed by the highest average price among the other countries surveyed, and finally the lowest price. The American average price was highest for every procedure but one.
- Average price in America: $13,910
- Average price in Switzerland: $9,845
- Average price in Argentina: $1,723
As with most procedures, there is a huge range in price even within the U.S. America’s 25th percentile for appendectomies is $8,244, while the 95th percentile is $29,499. The Netherlands, Australia, and New Zealand are in the $5,000 range on average.
- Average price in America: $10,002
- Average price in Switzerland: $8,307
- Average price in Argentina: $2,237
The 95th percentile in the U.S. is a whopping $17,354 for a normal delivery. In Australia, the average is $6,623, in the Netherlands it’s $2,824, and in Spain, $2,251. The American way of handling childbirth has been called the costliest in the world.
- Average price in America: $15,240
- Average price in Switzerland: $10,681
- Average price in Spain: $2,844
In the U.S., the 95th percentile is $27,446 for a C-section. Switzerland and Australia are in the $10,000 range on average, while America’s average is over $15,000. Argentina and Spain again had the lowest average prices, with the Netherlands falling in the middle at $5,492.
- Average price in America: $3,762
- Average price in Australia: $3,841
- Average price in Argentina: $1,038
Only Australia shows one instance of a higher average price than the U.S., with cataract surgery costing just $79 more. The American 95th percentile is $8,233, showing just how much prices can vary. Even the 25th percentile, $2,422, is higher than the average prices in Argentina, the Netherlands, and Spain.
- Average price in America: $25,398
- Average price in Switzerland: $24,614
- Average price in Argentina: $6,015
The average price of a knee replacement is above $20,000 in New Zealand, Australia, and Switzerland, as well as the U.S. However, America’s 95th percentile shoots up to $51,128. That’s the cost of nearly nine knee replacements in Argentina.
- Average price in America: $26,489
- Average price in Australia: $26,297
- Average price in Argentina: $6,862
Hip replacements in Argentina, Spain, and the Netherlands all fall somewhere below $12,000 on average, yet America’s 25th percentile for a hip replacement is $16,622, and the 95th percentile is $53,644. Artificial joint implants prices in the U.S. are inflated to begin with by the few companies that manufacture them, and then these prices are marked up several times by intermediaries, making artificial implants the single biggest cost of most joint replacement surgeries.
- Average price in America: $75,345
- Average price in Australia: $42,130
- Average price in the Netherlands: $15,742
For bypass surgery, even America’s 25th percentile of $47,982 is significantly higher than the average price of every other country surveyed. The figures for the Netherlands, Spain, and Argentina all fell under $17,000. The 95th percentile for a bypass surgery in America is $151,886.
- Average price in America: $27,907
- Average price in New Zealand: $16,415
- Average price in Argentina: $5,246
America’s 25th and 95th percentiles for angioplasty show a wide range of $16,406 to $61,184. Average prices in Spain and Switzerland are in the $10,000 range, and Argentina, the Netherlands, and Switzerland boast even lower prices for this minimally invasive procedure.
- Average price in America: $11,806
- Average price in Australia: $9,982
- Average price in Spain: $3,177
Though Spain has the lowest figure by far, in New Zealand the average price of a hip prosthesis is $6,723, just over half the average U.S. price. With $25,843 as the 95th percentile, this procedure could conceivably be eight times more expensive when performed in the U.S. than it would be in Spain.