French health care

by on March 24, 2007 at 1:29 pm in Medicine | Permalink

Many people (Jon Chait also) argue that France has the best health care system in the world.

As of 2003, the average income of a French physician was estimated at $55,000; in the U.S. the comparable number was $194,000.

A visit to a GP’s office (half of the doctors in France are GPs) had a reimbursement capped at 20 Euros, again circa 2003.  It is not hard to pay ten times that amount in the U.S.

Did I mention that health care is a labor-intensive industry?

This is the major reason why French health care is cheaper than U.S. health care.  France also spends less per unit on other inputs, such as prescription drugs.

Note that France still spends more than all or most other European systems, namely about 11 percent of gdp. 

When comparing health care outcomes, France only does slightly better than many Mediterranean countries with obviously non-enviable health care systems.  It is not obvious that France does better on health care outcomes than Japan, again a country with non-enviable health care institutions.  In other words, France spends lots of money making people feel good about their health care processes, with only very marginal measured health care results.  The United States also spends money on customer comfort, albeit in a more expensive and less egalitarian way.

It is easy to argue that the French system is better than that of the United States.  But a defender of the French system must, in reality, fight "a war on two fronts," to paraphrase Derek Parfit.  The French system does not, by the standards which have been erected in the debate, appear noticeably better than many other cheaper systems around the world.  It does spend more money producing "customer satisfaction" and papering over some of the obvious inhumanities of the cheaper systems.  That’s why it is easy to hold up as a model.

The disconnect arises because single-payer defenders wish to use international data to compare health care systems — France > U.S. — while pushing under the table the more radical (apparent) implications of that data, namely that France is spending far too much as well.

If we are going to be umm…transitive here, let’s have the debate where it belongs: expensive health care with marginal impact on measured health outcomes vs. saving lots of money and giving people much less in the way of health care services.  I do think there is a good case for the latter, though looking toward the future I would myself prefer the former. 

I might add I do favor taking action to lower doctors’ wages in the United States.  Letting in a greater number of qualified foreign doctors is step number one.  But if we’re going to criticize the U.S. system for its costliness, let’s put the blame where it belongs.

talboito March 24, 2007 at 1:58 pm

To paraphrase: The French system is better, but we shouldn’t use it anyway.

Or maybe:The French system looks a lot better, but if you take a closer look it is only a little bit better.

Rob March 24, 2007 at 2:24 pm

To paraphrase: The French system is better, but it’s not market-based, so it can’t be better.

thehova March 24, 2007 at 3:13 pm

We’ve gotta find a means to lowering doctors salaries.

200,000 a year!!!!!!!!!!!

and I think many doctors would take a paycut if it meant more reasonable hours and less insane education requirements/debt.

squik March 24, 2007 at 3:27 pm

I might add I do favor taking action to lower doctors’ wages in the United States. Letting in a greater number of qualified foreign doctors is step number one.

We already are importing large numbers of foreign physicians. I don’t believe we are limiting them in any way. The market is giving us what it will bear.

spencer March 24, 2007 at 3:40 pm

I just worked up some numbers. Take your estimate that the average doctors income is $194,000 and gross it up to $250,000 to account for insurance and other fringe benefits. According to the AMA there are roughly 800,000 practicing doctors in the US. that means doctors income amounts to roughly $200 B.

Current dollar US GDP is about $13,500 b.. 16% of that is $2,152 and 11% of that is $ 1,479.5 b , or a difference of $672.5. This implies that doctors income ($200, b) amounts to under 10% of medical spending ($2,152 b). If you completely eliminated doctors income this would account for about 30% of difference between the 16% of gdp the US spends on medical care versus the 11% France spends.

Now I realize my numbers are just back of the envelop calculations. What data do you base your conclusion that the difference in doctors income is the major reason the US spends more on health care then the French?
What is wrong with my back of the envelop calculations?

Tony March 24, 2007 at 4:01 pm

I don’t think the issues is some average “quality” score, or the cost per se. The issue is fairness and justice.

It is way too easy for responsible, careful, middle-class people in the US to suffer an expensive condition only to find themselves both uninsured and uninsurable on the basis of bad luck and obscure technicalities. It often happens about when people are sick and vulnerable, and can’t keep up with the bureaucratic details of their own care.

This happens all the time; it has happened to people I know personally. Just today there was an article in the paper about Blue Cross canceling individual patients on the basis of their claims. That this can occur at all mocks the very idea of insurance.

I don’t give a damn what insurance costs, and frankly the standard of care in France is good enough for me. I want to have it, pay for it, know that it covers whatever is going to happen, and be confident that I will never lose it. That is almost impossible to achieve in the US, and the fact that it’s especially hard to achieve for small independent businessmen is a factor that stifles innovation, limits job mobility, and ultimately serves as a drag on the economy.

Frank March 24, 2007 at 4:59 pm

You want more immigrant doctors. But I hope that you aren’t advocating draining ever more physicians from LDCs to developed countries. Consider this argument from Laurie Garrett (at
http://www.foreignaffairs.org/20070101faessay86103/laurie-garrett/the-challenge-of-global-health.html

“As the populations of the developed countries are aging and coming to require ever more medical attention, they are sucking away local health talent from developing countries. Already, one out of five practicing physicians in the United States is foreign-trained, and a study recently published in JAMA: The Journal of the American Medical Association estimated that if current trends continue, by 2020 the United States could face a shortage of up to 800,000 nurses and 200,000 doctors. Unless it and other wealthy nations radically increase salaries and domestic training programs for physicians and nurses, it is likely that within 15 years the majority of workers staffing their hospitals will have been born and trained in poor and middle-income countries. As such workers flood to the West, the developing world will grow even more desperate.”

I realize there is a good literature on the help that remittances do for the home countries, but money can do little for health when there is no one on the ground to purchase services from.

Jack March 24, 2007 at 5:24 pm

Where does the $55,000 figure come from? I find it hard to believe. Maybe it includes nurses and orderlies.

Certainly it’s not like that in the UK, the figure even for GPs is pretty close to the US one and possibly higher. It wouldn’t be hard for French doctors to work here.

Jasper March 24, 2007 at 7:23 pm

Single payer systems created by a populist politician under the theory of reducing costs scares the crap out of me. These systems will almost certainly reduce our quality of life, and I strongly suspect if the average American thought about it this way they too would be horrified about the prospect of a single payer system.

I think it’s time for some new terminology here.

How about we start using SINGLE PROVIDER to refer to British-style systems, SINGLE PAYER to refer to Canadian-style systems, and NON-SINGLE PAYER UNIVERSAL to refer to systems like that of France, Switzerland, Germany, Japan, Australia, etc. — where the government plays an important role in guaranteeing the universality of health insurance (and sometimes in the financing of the same), but where there are plenty of non-governmental actors — including for profit insurance firms — that play a role in providing and paying for healthcare.

I truly doubt many Americans would be “horrified” at the prospect of moving to a version of #3, where the law guarantees they’ll always be insured, but where’s they’ll be able to continue to enjoy the benefits of private sector health coverage.

Indeed, it seems that pretty much all of the world’s highest rated systems of guranteed, universal access healthcare follow this public/private mixed model, including what Tyler refers to as France’s highly regarded, much beloved but “expensive” (as I stifle the urge to break out in a full belly laugh) system.

By the way, I apologize for the botched pseudonym use above; I was reluctant to call out the famous professor on his own blog. Serves me right.

SteveSC March 24, 2007 at 10:47 pm

I believe France is one of the countries that grants a MD after a 6 year program straight from high school. This puts those MDs at a training level equal to a second year medical student here is the US, or approximately a Master’s degree level in other fields. France’s system also graduates many more MDs than there are openings for clinical training (the six years is almost all book work), so there are many MDs who are not employed as a clinical physician.

$55,000 is a reasonable wage for a Master’s level person. Almost all US physicians, though, have an additional three years training (two in medical school, one post graduate or internship) to reach the GP level and at least three more after that to become a family practitioner, internist or pediatrician. Subspecialists and surgeons have between one and five more years of training, which explains a lot of that higher salary.

topher March 24, 2007 at 11:09 pm

How does a believer in markets type (with a straight face, I assume) the following: “I might add I do favor taking action to lower doctors’ wages in the United States.”?

How do you justify the regulation of a physician’s salary? Shall I regulate yours?

thehova March 24, 2007 at 11:52 pm

doctors are overeducated (as are lawyers).

I think you can put a lot of the blame on the AMA.

glenn March 25, 2007 at 2:00 am

and I recognize this seems heretical – to me, too – but I think one must question whether healthcare, like much of defense spending, works well under a capitalistic model. Parts of it, sure. Some other aspects, probably not.

One last thing – and I don’t know how cultural this is, or if it’s just human nature – a HUGE percentage of spending happens in the last few months of a person’t life. Not to save their lives, m ind you, but just to extend it. And frankly, not to be judgmental, but the quality of those last few months are questionable.

People die, folks. Death is inevitable. Somehow, someway, there has to be a limit on this. It’s hard, it’s cruel, but when it comes to government spending, at some point we have to come to the conclusion that the costs of some services just aren’t worth the benefits.

Suvi March 25, 2007 at 6:01 am

“To paraphrase: The French system is better, but it’s not market-based, so it can’t be better”

It’s a bit of this too: The French system is better, but we can’t switch because then big pharma wouldn’t sponsor us

dearieme March 25, 2007 at 7:53 am

“I believe France is one of the countries that grants a MD after a 6 year program straight from high school. This puts those MDs at a training level equal to a second year medical student here is the US”: only if the standards of the French schools have collapsed lately, or the standards of US High Schools has secretly shot up.

mca March 25, 2007 at 8:58 am

“But a defender of the French system must, in reality, fight “a war on two fronts,”

Ha ha! France vs. cheaper poorer versions of universal health care, and what is the other front?

SteveSC, French doctors half as educated as US doctors? Ha ha! Get some freakin perspective buddy.

Well on second thought there is nothing like a good mandatory art history class to bring out the doctor in someone.

Allan March 25, 2007 at 11:07 am

Obviously, physicians are not a valuable commodity. Those in patient care lack the economy of scale that bankers have. That is, physicians can only treat a limited nimber of patients and, therefore, have a limited income.

Investment bankers, on the other hand, help companies that help millions if not billions of people. If every one of their customers gave them $10, the company would do good. If the physican were pay $10 per patient, the doctor would be bankrupt.

The bottom line is that bankers, individually, are more valuable to society than physicians. Until that changes, more and more Harvard graduates will shun medicine.

This might be a case for higher marginal taxes at an amount over $350,000 or so or for higher capital gains taxes.

This says something about the moral compass of our country. I am not exactly sure what that is.

Randall Parker March 25, 2007 at 6:52 pm

More doctors mean more tests, procedures, office visits. As a comparison of huge differences spent per Medicare patient (ie the elderly) in Miami to Minnesota will show, this does not appear to improve outcomes. So why bring in foreign doctors to fill up Minnesota with lots of excess care generating providers?

Yes, health care is labor intensive. Um, car constructioned used to be labor intensive. Automation fixed that. It could do the same for health care. We already have expert systems that beat all but the very top doctors for many diagnoses. Why not use more computers and and other forms of automation?

Automation raises living standards. Bringing in more labor lowers living standards.

john oshea March 25, 2007 at 8:00 pm

I am truly amazed at the lack of perspective here, I should speak up…since I took a long road though medical school and can enlighten some of you. First point of fact is that Doctors, who are GPs, average $153K per annum. (Specialists can make some fantastic money, but they pay their dues) Remember that we graduate school at the age of 30 with something like $250K in student loan debt, and start at a salary of $80K! Watch your hands shake as you write that check to the US gov. loan office for $2,000 per month! Then you get the fun of paying $15,000 for malpractice ins ( I pay mine), Dea license is $555, State license is $175, CDA is $100, oh and someone mentioned benefits! I pay $800 per month for my medical insurance ( I am in a private office and also balance .5 million for a practice loan at 9% interest) Try to come to grips with the fact that medical/dental schools have 40 credit/ hour semesters, and no rah-rah summer break, and you get the picture that we have 4-5 times the education basis that we are given credit for. Are we overeducated?? Ask your son or daughter who’s blood pressure is bottoming out while we look for the source of her internal bleeding.

mik March 26, 2007 at 2:29 am

john oshea,

So sorry for you barely surviving on $150K/year.
Where it was legislated that length of education dictates one’s
wages?
PhD in History may study longer than it takes to go thru Med School and residency
and still makes 1/3-1/2 of GP salary.

If you don’t like your educational loans, you should have go to Caribean med school for 4 years,
get MD diploma, come back, pass couple of tests and residency and start really making money
by time you are 26.

The fact that pretty average foreign docs have no problem to pass whatever tests
AMA makes them, just might indicate that your are not that superior to
them, regardless of the length of your education.

glenn March 26, 2007 at 9:36 am

MIK – Let me say a couple things.

You’re absolutely right that the length of education does not, and should not,
dictate one’s wages. But IMHO (and I do mean humble), I rather think someone
who is trained to save lives, improve lives, and regularly does so, is worth
a tad more than someone who does not. It’s not clear cut at all. I do not think
that I am stating a fact.

And as much as I value education, and educators (having several over-educated
professionals in my family), I’d pay any amount I could to have a sick loved one
better. I’d pay less, much less, to have them taught by a history professor.

save_the_rustbelt March 26, 2007 at 3:12 pm

During the heat wave in France several summers ago it was reported that many elderly died
because so many doctors and nurses were at the beach for their summer vacations.

This would not happen in the US. Coverage comes first.

Just reading throught the posts there is a great deal of misinformation about our own
healthcare system, which I suppose makes the debate more difficult.

Bill Harshaw March 26, 2007 at 4:24 pm

I found a couple of other figures in Tyler’s source interesting–France has more GP’s and fewer specialists than the U.S. There weren’t any specific figures on nurses, but another source showed a very wide variation in nurses in Europe (seems as if the number of doctors plus number of nurses equaled about 11 per 1,000 pop total–Italy had lots of doctors, but much fewer nurses for example). There was a figure on non-physician personnel per hospital bed, where the U.S. had about 2.5 times the number as France. We had fewer beds and shorter stays than France.

I wonder–to the extent medicine competes with law and finance for personnel, is it realistic to expect to reduce physician salaries without reducing the compensation for lawyers et.al?

Dick King March 26, 2007 at 8:53 pm

Investment bankers make more than doctors because their work scales, as noted by Allen on Mar 25, 2007 11:07:45 AM .

Fair enough.

That does mean that the investment banking industry won’t sop up very many potential doctors.

That’s even before we note that the skill sets are different, and therefore some of the investment bankers never were potential doctors in the first place. This concern might be almost like worrying about the nubmer of potential doctors become NBA baseball players instead, because of the larger sums available.

-dk

Jack March 27, 2007 at 3:20 pm

OK, the $55,000/year average pay for French doctors figures comes from the link that shows the US equivalent. Nevertheless I think it’s either wrong or the word “net” is doing a lot of work. I haven’t found any definitive figures but this link

http://management.journaldunet.com/dossiers/050165salairo/salaires_10000.shtml

does suggest that the $55,000 figure is low. Note Jacques Chirac on that page and surgeons are on the next. according to the site nurses make around $50,000.

Ronald Ramo April 5, 2007 at 5:43 pm

Steve S.,

I find your assertion that not as many doctors want to be teachers a little hard to swallow since, you know, life as a practicing doctor is so hard.
I think you are throwing out a bunch of Red Herrings, regardless of who is regulating the number of US medical schools, the whole licensure procedure acts as a bar on the increase in the number of US med schools.

How to hedge against the possibility of horrible outcomes from less experienced doctors is negative outcomes insurance that is being proposed by some in Congress, like Ron Paul. Moreover, what about other medical professions that jack up the price, like nursing. Lastly, what about government regulations that limit who can do certain medical acts like the midwives and the delivery of children.

Fran April 19, 2007 at 12:23 am

Your theory that the average income of physicians in the US is 200k is incorrect. The average gross pretax income is about 140k per year with an average workweek of about 75to 80 hours and an average education of about 13 years and an average debt of about 150k. Most physicians do not have additional perks or benefits as they are self or group employed so no matching of funds in retirement etc. They are at risk for 20 to 30 mill on almost every decision and they are condemned by society at every turn. We are more and more turning to arabic and asian physicians to fill our training slots because an ungrateful society is running phsicians out of practice faster than recruits can take their place. Same is happening in most of western Europe including france. Also, the mistaken notion that healthcare in france is free is absurd. You pay in taxes rather than at the hospital but either way you pay.The french economy has much higher unemployment than the US and they are rapidly moving towards a crisis with an aging population and a huge welfare state debt.

Drug Detoxification May 18, 2007 at 8:31 am

To best understand how the French health care system works, I think it is best to begin with a look at the French health insurance system.First of all, all legal residents of France are covered by public health insurance, which is one of the social security system’s entitlement programs. The public health insurance program was set up in 1945 and coverage was gradually expanded over the years to all legal residents: indeed, until January 2000, a small part of the population was still denied access to the public health insurance.

Shiv June 30, 2007 at 4:14 pm

Bunch of baloney

Eric September 14, 2007 at 11:57 am

The French system IS better. Hands down.

As an American living in France, I can say that I find the French system top notch. I would much rather start with the French system and fix it than try to fix the US system.

The basic problem with healthcare economics and the free market is the answer to the question, “How much is your or your child’s life worth?” and its correlary “How much is your neighbor’s life worth?” When there is no limit to what one is willing to pay for a service, how can you speak of a “free” market?

The key to France’s system is their abiliy to balance private/public insurance and private/ public healthcare. Basically the system works but many aspects could not be transferred to the US without much difficulty.

Yes, French doctors have no Med School debt, have lower insurance rates but they are also much less greedy than US doctors and quite content to earn between 100 and 200K$. (the 55k$ figure is probably somewhat low because it’s probably a net figure after SS tax, the way French usually speak of ‘gross salary.’) Also, I would bet that on average French doctors work much fewer hours than their US counterparts. I know several docs who are happy to earn equiv of $90k and only work 4 days a week. It also doesn’t take much of an investment to set up a doc’s office in France.

But then all the French are inclined to “earn less and live more” than we Americans.

Secondly,importing the US tort system and skarkskin suit lawyers to France would probably kill the French system. Laywers in Europe are not allowed to advertize, nor be paid as a percentage of a clients winnings. Nor are they allowed to file class action lawsuits. (Don’t everybody try to immigrate here at once!)

French hospitals and even doctors’ offices are not luxurious and the “bare bones” atmosphere shocks a lot of Americans. Nearly all GPs and most specialists operate out of converted apartments and almost never have other medical personnel working with them (thus low % of nursing staff). At best they might have a secretary and that is even rare. My own GP answers the phone and handles payments herself. “Paperwork” is nearly completely automated by using the Social Security smartcard. It literally takes the doc 3min to process my payment and make a few notes on her PC. (Tell that to your Swedish friends!) All the data is then transferred electronically to my private insurer who will reimburse me within 2wks. There is low overhead because hardly any medical procedures are performed in the doc’s office, thus little need for equipment. (for ex. not even drawing blood.) The best part is that you actually get to spend 10 to 20 minutes WITH THE DOCTOR. All this for only 22€ for a GP visit. (and I get reimbursed 21€; 70% by SS, the rest by my private insurance.)

French docs may choose to work with the national insurance system or not. 99% of French doctors choose to do so. Within the system they can choose among two rate systems. 85% of doctors choose to participate in the lower rate system which gives better coverage to their patients and lowers their own payroll taxes.

To fix the French system: Up the co-pay from 1 euro to 5 euros. Add a 100€ deductable for higher income households. Hand out real sanctions for over prescription of antibiotics and tranquilizers. Go back to having people pay for their prescription drugs and getting reimbursed rather than the new system of direct billing to the insurer. Stop reimbursing aspirin and spa treatments!

I have been treated in both public hospitals and private clinics in France and in both cases the care was similar and satisfactory.

Yes, it’s true that you have to choose your French dentist wisely. I’ve found the younger ones much better qualified. Don’t quite understand how France can be world leading in cancer treatment, transplants, & vaccines and have such poor dental care, but I think this is a annecdotal historical difference, not a systemic problem.

Also not all residents are covered by French social security. People who live only on investments (no salary) have to take out their own private insurance unless they earn less than 8k€/yr.

And how much education do you really need to be a GP? Most GPs here are 29 by the time they can open up shop on their own. (Assuming they did not do military service.) And yes, they go directly from high school to med school.

Never heard of anyone in France suffering from having to wait for treatment.

And the heat wave deaths have nothing to do with the French medical system. Too many people living alone, not used to record breaking temperatures and not equipped with A/C. It has more to do with American SUV drivers, if you are looking to blame someone!

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