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Home / News & IndustryManaged Care Insight and Analysis
Updated: July 14, 2009
New Study Shows Healthcare Costs Put U.S. Workers At Big Disadvantage

The costs and performance of the U.S. healthcare system have put America’s companies and workers at a significant competitive disadvantage in the global marketplace, according to a study by the Business Roundtable.

Business Roundtable, an association of chief executive officers whose companies provide healthcare formore than 35 million Americans, released its first annual Business Roundtable Healthcare Value Comparability Study.

"Healthcare costs are one of the top cost pressures facing American businesses today, inhibiting job creation and hurting America’s ability to compete in global markets," said Harold McGraw III, chairman of Business Roundtable and chairman, president and CEO of The McGraw-Hill Companies. "This study helps us understand the relationship between spending, quality and competitiveness, while enabling us to track progress as we push forward with healthcare reform."

The report combines internationally reported measures covering both spending on, and the performance of, national healthcare systems to assign a value to the U.S. healthcare system compared with important global competitors. On a weighted scale, the results show that U.S. workers and employers receive 23 percent less value from the healthcare system than the average of five leading economic competitors –Canada, Japan, Germany, the United Kingdom and France (the G-5 group) – and 46 percent less value than the average of emerging competitors Brazil, India and China (the BIC group).

"This study shows a significant healthcare value gap," said Ivan Seidenberg, chair of Business Roundtable’s Consumer Health and Retirement Initiative and Chairman and CEO of Verizon Communications. "While, in many respects, the employer-based healthcare system in the United States is the best in the world – we have groundbreaking scientific advances, cutting-edge medical technology, and exceptional doctors and medical institutions – the business model supporting it doesn’t meet Americans’ needs. When we spend more to get less, we all lose – workers, employers and the government. The study points to a serious need for healthcare reform that puts customers in the center and uses the power of the market to lower costs, improve quality, create more consumer choice and expand accessibility."

The study also showed that, as a group, the G-5 countries spend approximately 63 cents for every dollar the United States spends on healthcare – yet the health of the U.S. workforce lags by 10 percent in a composite measure. The gap is even wider in relation to rising economic powers: the three BIC countries spend just 15 percent of what we spend on healthcare, yet the health of the U.S. workforce trails that of BIC countries by 5 percent.

The Healthcare Value Comparability Study, which was led by health value specialist Arnold Milstein, weighs 19 separate measures of health spending and workforce health, chosen for their relevance to employers and their workforces and cross-nation comparability. It compares the United States with the G-5 group and the BIC group.

"The CEOs of Business Roundtable believe true reform of the healthcare system must emerge from the uniquely American principles that drive our economy: competition, innovation, choice and a market that serves everyone," said Seidenberg.

Business Roundtable has created a healthcare reform plan rooted in these principles. Designed to put the United States on the path to a competitive healthcare system, the plan rests on four pillars:

    a. Creating greater consumer value in the healthcare marketplace by using health information technology and empowering consumers with more information about quality healthcare.

    b. Providing more affordable health insurance options for all Americans by creating an open, all-inclusive private market for health insurance and replacing today’s fragmented state-by-state marketwith multistate markets.

    c. Engaging all Americans in taking an active role in their healthcare. First, this means placing an obligation on all Americans to obtain health insurance either through their employer or the private market. Second, we must encourage all Americans to participate in employer- or community-based prevention, wellness and chronic care programs.

    d. Offering health coverage and assistance to low-income, uninsured Americans to create a stable and secure public safety net.

Address: Business Roundtable, 1717 Rhode Island Ave. NW, Washington DC 20036; (202) 872-1260,

  This article was taken from:
The Executive Report on Managed Care

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