JAMA report on U.S. healthcare spending calls out imaging

Why are U.S. healthcare costs so much higher than those in comparable developed countries while clinical outcomes are worse? When a study published online March 13 in the Journal of the American Medical Association sought to answer that question, heavy utilization of imaging technology in the U.S. landed squarely in its crosshairs.

The U.S. spends twice as much as other high-income countries on medical care, but it continues to have some of the poorest healthcare outcomes and utilization, according to the researchers. In 2016, the U.S. spent 17.8% of its gross domestic product on health, compared with a range of 9.6% to 12.4% across 10 other countries.

And although the overall utilization of different types of healthcare services was similar between the U.S. and other countries, one exception was for imaging: For example, the U.S. performed the highest number of CT scans and the second highest number of MRI scans per 1,000 people, among the 11 countries.

Paying more for less

It's common knowledge that the U.S. spends more on healthcare than other advanced nations, while falling short on common clinical outcomes such as life expectancy and infant mortality. But the reasons for this disparity are less well-understood, prompting the team led by Irene Papanicolas, PhD, of the T.H. Chan School of Public Health at Harvard University to delve deeper into the issue.

Common explanations have included the fee-for-service system and underinvestment in social programs in the U.S. However, Papanicolas and colleagues found that U.S. healthcare spending appears to be driven more by prices -- for physician and hospital services, pharmaceuticals, administrative costs, and, yes, diagnostic tests such as CT and MRI scans.

"[Our] findings indicate that efforts targeting utilization alone are unlikely to reduce the gap in spending between the United States and other high-income countries, and a more concerted effort to reduce prices and administrative costs is needed," the authors wrote.

The team used 2013-2016 data from sources including the Organization for Economic Co-operation and Development (OECD) to compare the U.S. with 10 other high-income countries -- Australia, Canada, Denmark, France, Germany, Japan, the Netherlands, Sweden, Switzerland, and the U.K. -- across a variety of healthcare measures. The group analyzed the information for measures such as general health system spending, labor costs, structural capacity of the system and access, utilization, and population health. The U.S. lagged for a variety of population health measures.

At the same time, the U.S. had the following:

• Double the amount of spending on pharmaceuticals, compared with the other 10 countries
• The highest rate of private insurance as the primary form of healthcare coverage, at 55.3%; most of the other countries do not have private insurance as the primary form of coverage
• The highest remuneration for generalist physicians, at $218,173, compared with a range of $86,607 in Sweden to $154,126 in Germany, among the other countries
• The highest remuneration for specialists, at $316,000, compared with a range of $98,452 in Sweden to $202,291 in Australia, among the other countries

The U.S. does tend to perform better on acute care outcomes than primary care measures, the group wrote; for example, it has the highest breast cancer screening rates and the lowest 30-day mortality rates for heart attack and stroke. But it has relatively poor population outcomes (such as life expectancy and infant mortality rates).

The high cost of imaging

The U.S. was in the middle of the pack in terms of utilization for most health services, such as discharges for acute myocardial infarction, mental and behavioral issues, pneumonia, and chronic obstructive pulmonary disease. On the other hand, the U.S. tended toward the higher end of the scale for surgical and cardiovascular procedures.

However, Papanicolas and colleagues focused specifically on discrepancies in imaging utilization between the U.S. and other countries. The U.S. performed the greatest number of CT scans and the second greatest number of MRI scans per 1,000 people -- and these exams were more expensive: A CT exam in the U.S. had an average payment of approximately $896 per scan, compared with $97 in Canada, $279 in the Netherlands, $432 in Switzerland, and $500 in Australia. Meanwhile, the mean payment for an MRI in the U.S. was approximately $1,145, compared with $350 in Australia and $461 in the Netherlands.

As for the installed base of imaging equipment, Japan had the greatest number of MRI and CT scanners per 1 million people, at 52 and 107, respectively. The U.S. had the second highest number of MRI units, at 38, and the third highest number of CT scanners, at 41. The lowest per capita rate for both MRI and CT scanners was in the U.K., with seven MRI devices and 10 CT scanners per 1 million people.

Specific data

Papanicolas and colleagues believe that the data disprove some of the more common explanations for why U.S. healthcare costs are higher, such as low investment in social programs, a low ratio of primary care physicians to specialists, a fee-for-service system that encourages a high volume of care, and defensive medicine that leads to overutilization. Instead, they see the prices of healthcare services as the primary problem.

"The data suggest that the main driving factors were likely related to prices, including prices of physician and hospital services, pharmaceuticals, and diagnostic tests, which likely also affected access to care," they wrote. "In addition, administrative costs appear much higher in the U.S."

As a result, cost-containment efforts that only target utilization are unlikely to address the disparity between the U.S. and other countries, and a broader effort to reduce costs would be needed, they concluded.