Healthcare Systems in the United States and India Compared

Introduction: Origins of Two Healthcare Systems

The healthcare systems in the United States and India have starkly different origins: the former arose out of employer-based insurance coverage while the latter began through government funding. As Sai Ma and Neeraj Sood document in a report on India's healthcare challenges, the Indian government faced the challenge of redesigning its healthcare infrastructure after independence in 1947 (2008). The Bhore Committee, assembled by the central government, established that unsanitary conditions, poor nutrition, inadequate health education, and a lack of preventive care all had to be addressed in order to improve the quality of life for India's population. To meet these needs, the central government established a three-tiered system consisting of primary health centers (PHCs) to meet basic health needs, subcenters (SCs) for public health concerns, and community health centers (CHCs) for more specialized care. Doctors employed at these facilities received training at publicly funded universities, and patients could access care at no cost. The central government provided funding and oversight while the primary responsibility for healthcare administration fell to the states. Despite the establishment of this national infrastructure, the Indian government never intended to abolish private practice. In the 1950s, private healthcare services made up a small percentage of India's total healthcare system; since the 1980s, medical tourism, government cuts, and a push from the middle class for more high-tech care have all contributed to the rise of the private sector. This trend has reduced the quality of public care while creating a private system that the vast majority of Indians are unable to afford (Ma and Sood 2008).

The United States health insurance system grew out of a need to fill hospital beds during the Great Depression: Blue Cross pioneered employer-based insurance for schoolteachers (Roberts 2009). The effectiveness of their model spread quickly, leading to a period during the 1950s when consumer demand for services was high and doctors received ample reimbursement from insurance providers. However, coverage for the poor and elderly remained low. During Lyndon Johnson's administration, Congress passed legislation establishing Medicare and Medicaid, which covered citizens over 65 and the poor, respectively. With increasing coverage and guaranteed government reimbursement, cost soon became the nation's primary concern. For cost control, Nixon introduced the concept of a Health Maintenance Organization (HMO), which he argued would reduce expenditures through competition and reward groups for keeping people healthy (Roberts 2009). The American Medical Association lobbied against HMOs, and they did not have the completely revolutionizing effect Nixon had hoped for. HMOs reached their peak popularity during the 1990s, when President Clinton introduced his healthcare proposal (Roberts 2009). The proposal, which never passed, called for a national health board that could regulate groups of competing insurance providers while placing a cap on premiums. The problem of rising costs has continued to the present. The Patient Protection and Affordable Care Act, passed in 2010, aims to reduce costs; however, the subject of improving U.S. healthcare infrastructure has never been more pressing (Manchikanti et al. 2010).

Health Outcomes: A Statistical Comparison

India experiences poorer health outcomes than the United States by most metrics. Life expectancy is 64 years in India and 78 years in the U.S.; infant mortality is 69 per 1,000 live births in India and 8 per 1,000 live births in the U.S.; the incidence of tuberculosis is 190 cases per 100,000 people in India compared to 3 cases per 100,000 in the U.S. (WHO). The majority of life years lost to poor health in India are attributable to communicable diseases (56%), such as malaria and tuberculosis, while noncommunicable conditions and injuries make up the remainder. Vaccine-preventable illnesses account for 7% of the total life years lost in India (Ma and Sood 2008). In the United States, noncommunicable conditions — including diabetes, cancer, and heart disease — are responsible for the majority of life years lost (76%), while communicable diseases (9%) and injuries (18%) have a comparatively smaller impact (WHO 2011).

Healthcare Spending and Access to Care

There is a dramatic difference in the proportion of GDP that the United States and India spend on healthcare. India spends 1–4% of its total GDP on healthcare costs (WHO; Shiva Kumar 2011; Ma and Sood 2008), while the U.S. spends 16%, or $6,402 per capita as of 2008 (NPR). Of that $6,402 figure, $2,884 (45%) is paid by the government, $2,676 (42%) by private insurance — of which 52% is paid by employers and 48% by employees — and $842 (13%) is paid directly by consumers out of pocket (NPR). In contrast, consumers in India pay 78% of healthcare costs directly out of pocket, while the government contributes roughly 15% (Shiva Kumar et al. 2011). The market for private insurance companies has not yet been fully developed but is expected to grow rapidly over the next decade. Currently, only 10% of Indians have at least one family member covered by some form of insurance (Shiva Kumar et al. 2011).

The direct cost to consumers has created a significant access barrier. The working poor pay approximately 40% of their income on healthcare expenses, while wealthier urban workers spend just 2.4% (Varatharajan, Thankappan, and Sabeena 2004). Out-of-pocket healthcare payments push 6% of the Indian population below the poverty line each year (Berman, Ahuja, and Bhandari 2010). A government report found that there are 10% fewer PHCs than needed and 50% fewer CHCs than needed due to lack of funding (Ma and Sood 2008). All of these factors contribute to deeply unequal access to care.

References

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