Sweden: One Reason Not To Fear Single-Payer Health Care

18 Aug

Tired of the rants from the right that appear drawn from thin air, I spent some time recently digging up information from legitimate sources of conservative opinion on health reform. I visited places online like the CATO Institute, The Heritage Foundation, The American Enterprise Institute, and The National Center for Public Policy Research.

One particular article caught my interest, particularly since I studied the Swedish health care system during my time at the University of Georgia and even had a chance to travel there as part of my research. The piece, written by Dr. David Hogberg, uses Sweden’s single-payer health care system to warn other countries about the difficulty in balancing rising costs against long wait times. The graph, shown below, is used to indicate that health care costs rose, then leveled off under a system of global budgeting that increased wait times for certain procedures, and that once reform was implemented to address the wait time issue, costs are on the rise again. It’s hard to argue with the numbers.
How does the United States compare? Well, see for yourself. Shown below are the data on national health expenditures as a percentage of gross domestic product for both the U.S. and Sweden during the 1970 to 2004 period used by Dr. Hogberg. (You may need to click on the image to pull up a larger version.)

Wow. It sure looks like the U.S. and Sweden, once fairly similar in terms of health care spending, have parted ways. Guess who’s devoting more and more of their national productivity to health care? I’ll give you a hint: Det ar inte Sverige. (That’s Swedish for “It’s not Sweden.”)

Lucky for me, the Centers for Medicare and Medicaid Services (CMS) has a lot more years of data available. Here’s what things look like if we examine the period from 1960 and include projections through 2018. To emphasize the overall findings, I’ve fit a trendline to the data. Notice how flat Sweden’s looks and how steep the growth trend is for the U.S.

If that’s not a stark contrast, I don’t know what is. Okay. So the U.S. is spending more and more of its GDP on health care every year, while things in Sweden seem to be increasing at a rate so slow that the growth is almost hard to see by comparison. What explains this? Well, it’s fairly simple. In the United States, our national health expenditures are increasing more rapidly than our GDP is from one year to the next, as the chart below makes clear.

As long as that green trend line stays above that blue trend line, we’re just going to experience more of the same. Here’s the kicker: Eventually, unless something changes to bring the green line below the blue line, our national health expenditures and our gross domestic product will become synonymous. In other words, we’ll be spending more and more of our resources on health care until we reach the point where all of our resources are spent on health care. Still think that the status quo is a better option than health reform? I sure don’t.


Posted by on August 18, 2009 in Uncategorized


5 responses to “Sweden: One Reason Not To Fear Single-Payer Health Care

  1. Joel

    August 19, 2009 at 12:31 am

    You compare healthcare costs in the United States and Sweden against GDP, but do not seem to address the problem of the lack of healthcare choices and availability in Sweden. As Dr. Hogberg points out, many of the county councils there adopted market-oriented reforms during the 1990s to help combat the problem of insufficient care availability.I might agree with you, based on your data, that a single-payer system has helped Sweden to control rising costs – but as I have before suggested is the case in Canada, only at the expense of readily available quality care.It's a fact that 93% of the insured in America are "satisfied" or "very satisfied" with their current care, and 95% of those who suffered chronic illness are satisfied with their health care. Contrast that with the conclusion of the following study conducted at the Nordic School of Public Health in 2002:, is it exactly fair to compare "National Health Expenditures" between our two nations? What components comprise these expenditures in each location? After all, Sweden has the Medical Products Agency, the Pharmaceutical Benefits Boards and the National Corporation of Swedish Pharmacies. Does it not stand to reason that many of the cutting edge surgical treatments and pharmaceuticals available here (to those that can pay, of course) simply don't fit into the global budget there? How many of the costs factored into our NHE are of the R&D variety borne by firms researching new practices and medicines, which might benefit Swedish citizens one day if they are determined to be cost effective enough to fit into their budget?The numbers here are incomplete and unconvincing. One might surmise from a graph depicting my "Ferrari expenses" to Richard Branson's that I am getting a much, much better deal on them. In reality, I'm driving a slightly different car.

  2. D. Brad Wright

    August 19, 2009 at 2:26 am

    I assume you're refering an article by Rosen and Karlberg (not sure, because the link doesn't work). While you are correct that the article does seem to conclude that there is a gap between what patients expect and what doctors think should be provided, I don't think that that's the main point of the study, nor do I think you'd find much difference if you did a rigorous study in this country.First, I think the main point of the study is that the docs in Sweden want government to make more decisions about what to cover, while government officials want doctors to make the call about what is needed. Second, even in the U.S., I think you'd find that given the freedom to choose it, most people would want more than their doctors would want to provide. The thing is, patients' choices are already quite limited. Asking them if they are happy with their own coverage is fine, and you correctly cite that most people are content with what they have. At the same time, an overwhelming majority agree that major health reform is needed in the U.S. It's a paradox….they love what "they" have, but they think the system needs to be changed for "everyone else."To clarify, National Health Expenditures are the same in both countries, only including actual cost of care–that would include cost of prescription drugs, but not the cost of R&D (well, only to the extent that those costs are passed on to the consumer). But don't think all that happens in the U.S. Yes, we have Pfizer and Merck, but AstraZeneca is the result of a merger between a Swedish company and a UK firm. GlaxoSmithKline is a UK firm. Sanofi Aventis is French. If anything, Pharma is an international force.As for the Ferrari expenses, I view that as a bit of a canard. But to use your example, there is enough waste built into our system so that with some restructuring and regulation, everyone could at least have access to a car, while those with more resources would still be able to buy a Ferrari if they wish. Every country in the world that can be said to have a "health care system" (i.e., industrialized nations) still has another system that permits the wealthy to "top up" their coverage. That's true in places like Canada, England, and Sweden. We're not talking about putting a ceiling on what people with the means to do so may get, we're talking about installing a benefit floor that ensures a decent set of essential services as part of a compassionate and humane society. I fear, however, that until people confront some of the more harsh realities of inadequate access to care, they will not grasp the needs that exist here. There are places in this country–impoverished pockets of people– with health outcomes that are actually worse than some places in subsaharan Africa. My grandmother, for example, is dependent on both Medicare AND Medicaid. You can't tell me she didn't work hard her entire life, and you can't tell me she doesn't need the help. I know both to be true. Why can't we agree that there should be a basic level of support in this country for the least well off? Again, not a big handout, but a hand up. Because if, after all, a society is to be measured by how well it treats the least among its people, I hate to say it, but the U.S. falls woefully short of a decent society.

  3. Joel

    August 19, 2009 at 2:19 pm

    Well, this is where we come full circle back to ideological arguments. Legislating compassion and sympathy is a flawed concept – these are characteristics of an individual and not of a governing body or private enterprise. An immense wealth of history exists to support this, plus it's just good old common sense. I fervently believe we should be empowering individuals with more freedoms, not our society with "minimum benefits". Given the opportunity, the individual will wield compassion far more effectively than any social welfare program.Consider the findings of Syracuse University professor Arthur C. Brooks. He finds a correlation between religion, nuclear families, and a distaste for income redistribution programs – and charitable giving. is another excellent article from the NRO by Peter Wehner discussing the inauthenticity of state compassion:"President Obama is willing to see private charitable giving to the poor decrease in order to see the scope and size of government increase. These are the actions of an ideologue, not a pragmatist."Hear, hear. These are certainly not the people I want to be determining and enforcing a "benefit floor". Am I happier with the "status quo" than the socialist policies this president has repeatedly proposed? You bet I am. The way I see it, a hockey game would be a pretty miserable experience if there were no referee (an argument for regulatory reform), but an even worse experience if he jumped in and started playing by his own rules (an argument against socialist reform).Please reassure your friend and tell me you don't honestly believe that the "U.S. falls woefully short of a decent society." I can't see how you could accept that.Oh and also – I was a little confused with the way you interpreted my "Ferrari Expense" example. It was only intended as an example of graph data being misinterpreted when the metrics are unknown or misunderstood. Like "National Healthcare Expenditures", "Ferrari Expenses" has little to no meaning when the expenses themselves aren't laid out.

  4. D. Brad Wright

    August 19, 2009 at 2:35 pm

    In short, I think that the country should wish to see a basic level of human existence for its people. We have regulation of public utilities and goods like potable water, safe electricity, education, prisons, and the like (which are operated by a mix of public and private entities), and I think that essential health care services are no different. The line between the CDC, the FDA, the work of public health departments and medical care is not as sharply defined as we might like to think. A healthy society benefits everyone, and a sick society harms us all. From a conservative standpoint, it's bad for business if your employees are unhealthy and miss work.You're continuing to use the "socialist" label when it absolutely does not apply. We're not talking about government ownership, and we're not even talking about single-payer. I don't envision this as government mandated charity, I see it as a way of providing security to our citizens, which we've seen fit to do in other areas. I am open to a wide variety of possible avenues for reform, but the status quo, my friend, if left unchecked, will ruin our country. Get back to me when your employer stops offering coverage because it's too expensive, or you actually have to use your insurance for something only to find that it isn't covered, or God forbid, you end up seriously ill, hit your lifetime policy limits in a couple of months, and end up bankrupt–and then we can talk about how lovely the status quo is.

  5. Ed Fields

    September 1, 2009 at 6:53 pm

    with the trillions wasted on 'defense' (i.e., protecting pipe lines when we shouldn't even be burning oil in the first place) and the trillions shunted off to the banks, why is it that we the tax payers can't have inclusive and universal health care w/o co-pays, deductibles, limits and whatever else the insurance companies can dream up to increase their 'bottom line'?ed in Carlisle, MA


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