• The Invisible Hand

Which Country Has the Best... Healthcare?

This mini-series looks at which countries have the best... healthcare, defence, infrastructure and education. We will also consider what we can learn from these systems.


UNITED KINGDOM

The UK healthcare is internationally regarded due to its free, universal coverage. There are no upfront payments and it was ranked first in the world in the latest Commonwealth Fund assessment of healthcare. It is even quite cheap despite constant complaints over its efficiency and cost. We only spend 9.9% of GDP on health care compared to a monumental 17.3% in the US. Effectively, everybody in the UK pays half as much as in the US on average. British people are very proud of these achievements and 52% of people say the NHS is what makes Britain great. A universally accessible free system is vital because healthcare does not behave like other markets. If people have to pay to receive healthcare, there is a disincentive for people to receive help, so medical provisioning will be limited and it will be the poor who suffer most from poor health.


However, like other systems there are complaints. News articles seem to be constantly about the pressure on the healthcare system of an ageing population or an obesity epidemic and alcohol bingeing. Waiting times are also a source of ire because although the target is for 95% of patient to be seen within four hours, the rate has fallen below 80% in some months. It is also true that healthcare costs are rising. This is a concern, but not a reason to reject the UK healthcare system as a model because most major economies have rising healthcare costs and this is likely to translate into better health outcomes.


SINGAPORE

Singapore adopts a different, more complicated system. All citizens must subscribe to a basic health insurance scheme, but there are options to upgrade for better quality service. For the poor there is also government subsidies which can cover up to 80% of the costs of treatment. So unlike the UK there are both government and private hospitals with government hospitals more affordably priced. Two-thirds of the system is private which is even more than the US. This more privatised system aims to give access to healthcare to everybody, while introducing free market principles of competition in order to try to keep hospitals efficient and ensure they provide a high quality of service. This system has largely worked for Singapore and Bloomberg has ranked them as the most efficient system in the world in 2014. Unlike the US the government provides the insurance so less money is taken away by insurance companies.


However, there are many reasons why Singapore’s system is the way it is and fundamentally, this model is not scalable to other countries. First, it is much easier to run a healthcare system in a single small country such as Singapore because the system is easier to control by the government and the population of Singapore is largely homogeneous and wealthy so they can afford a system like this. Those who are less well off in Singapore are often crippled by health costs. With a private system of healthcare there is a disincentive for poorer people to seek this sort of treatment. Remarkably, Singapore’s healthcare only costs 4.3% of GDP, however, this is largely due to much cheaper labour cost for their medical staff. They receive on average less than half the pay of US medical staff. This level of pay would never be acceptable in the US so this system is hard to emulate.


SWITZERLAND

Switzerland has a slightly more significant government role in its healthcare, however, insurance is provided by competing non-profit private sector firms. This is supported by several price caps and 29% of people receive government assisstance. The public sector makes up 65% of healthcare spending, but there is no government run insurance plans, unlike the US, the main difference its that everybody buys insurance for themselves which encourages competition.


Switzerland has a very high quality of medical care, with doctors on time and available at short notice. Out of the three systems they have the highest number of physicians per 1000 people at 4.25 while the UK has 2.83 and Singapore has 2.28. Switzerland also has a marginally high life expectancy of 82.9 compared to 82.8 in Singapore and 81.0 in the UK. However, this system is largely propped up by a wealthy population who can afford such a system. It costs 12.1% of their GDP so is considerably more expensive than the UK. This means that for the average person healthcare is expensive and for the average person healthcare is expensive.


CONCLUSION


Overall, Switzerland wins on quality, Singapore wins on efficiency, but the UK wins overall. Both Singapore and Switzerland are small, rich states so it is easier to have a good healthcare system. Britain meanwhile represents the best model for normal countries. It pays considerably less than other countries while still providing excellent emergency care. We are right to be proud of our healthcare, because we are really getting a bargain.



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