We have talked about the correlation of mental health and wealth – if you are wealthy are you healthy and happy? The answers were intriguing.[1] Now let us look at it from a slightly different angle, is there a connection between how wealthy a country is and its overall life expectancy? While poverty correlates strongly to poor health and longevity, the reverse is surprisingly far from reality.
Let us look at two economic indicators to evaluate the correlation.
Q1. How much are wealthy nations spending on healthcare as a portion of their GDP?
Q2. How is the spend translating into long and healthy lives for their citizens?
Organization for Economic Co-operation and Development (OECD) was established in 1960 to promote policies to improve the economic and social well-being of people around the world. The OECD provides a forum in which governments can work together to share experiences and seek solutions to common problems. As part of one of their global data analysis initiatives they maintain trends of health Care spending by Country and how they compare to their GDP. United States tops the list at 17% in 2009, with projections to indicate this global leadership position[2].
Healthcare Spending as part of GDP
So as a country spending top dollars in healthcare, how are we doing in life expectancy? Are we the absolute best in living long healthy lives? To answer this question empirically let us look at the following study conducted by - United Nations, Department of Economic and Social Affairs, Population Division (2011), World Population Prospects: The 2010 Revision.[3] The top ten countries does not include USA. In fact USA ranks #45 on this list. Among the top on the list are Japan, China, France, Spain, Switzerland and Italy.
The question then becomes, what explains the gap? Why is spending the top dollars in healthcare not translating into Americans leading the longest and healthiest lives. Quality of medical care in USA competes well globally. Crème dela crème of the global health care practitioners are working in a supreme capitalistic free democracy serving the system – yet we are #45 in life expectancy.
Is it Lifestyle? Is It Nutrition?
According to USDA, the share of income or private consumption expenditure (PCE) spent on food is often used as an indicator for the relative well-being of a country. What is unique in USA in Food Spending? [4]
In the U.S., the rise in food spending as income increases is driven largely by food away from home, which captures two-thirds (65 percent) of the more than $450 increase in monthly household food spending between the lowest and the highest income groups. The highest income households spend nearly half (47 percent) of their food budget on food away from home, almost double the share among the lowest income households.
U.S. spending on fruit and vegetables rises only minimally across income levels. Households in the highest income group—which have an average of $8,000 more in after-tax monthly income than households in the lowest income group and spend over $450 more on food—choose to spend just $26 more per month on fruit and vegetables, which translates into an additional 21 cents per person per day on fruit and vegetables. The small change in spending on fruit and vegetables may explain why many high-income households also fail to meet intake recommendations for fruit and vegetables, and suggests that income and prices are not likely the main factors behind the low consumption of fruit and vegetables among low-income households, as is commonly believed.
So here we are, leaders in GDP, education and healthcare spend, chosing to pay top dollars for bad nutrition and a bad lifestyle that makes us unhealthier everyday as we continue to debate the Budget Deficit and Health Care spend!
[1] http://myayuvia.blogspot.com/2011/07/health-and-wealth-is-there-connection.html
[4] http://www.ers.usda.gov/AmberWaves/February08/Features/CovergingPatterns.htm