DATA & SOURCES

Quick Facts

Methodology for Calculating Estimated 1PLAN Cost Savings

The following is a description of the methodology used for calculating the cost savings realized by switching to 1PLAN:

Comparison of G7 health care expenditures as a percentage of GDP:

A comparison was made between the U.S. and the other G7 countries using 2006 health expenditures as a percentage of GDP. The G7 countries: U.S., Canada, U.K., Japan, France, Germany and Italy were used, because the have a similar standard of living to the U.S., and with the exception of the U.S., they all have universal health insurance/care systems. Percentage of GDP was used, because this most closely represents real expenses in each country. The year 2006 was used, because this was the most recent comprehensive data for this comparison.

In 2006, U.S. health expenditures as a percentage of GDP were 15.3%, while the average of the other six countries was 9.5%. In comparing these two percentages, 9.5% is 38% lower than 15.3%; in other words, if the U.S. matched their GDP health care expenditures to the rest of the G7countries, it would spend 38% less than it does now.

Calculation of estimated cost savings:

Using the 2008 U.S. data of a GDP of $14.6 trillion, health expenditures of $2.4 trillion, and a population of 304 million combined with the 2006 G7 comparison calculation of 38%, the following figures were calculated: U.S. total health care waste per year ($2.4 trillion x 38%): $912 billion. U.S. per person health care waste per year ($912 billion / 304 million people): $3000. The year 2008 had the most recent comprehensive data for these calculations. We believe that using the GDP percentage from 2006 creates a conservative 1PLAN cost savings estimate because newer (though not-yet-complete) data suggests that the U.S. continues to spend an increasing percentage of GDP on health care compared to other G7 countries.

An attempt at fairness and objectivity:

We acknowledge that data varies between sources and from year to year and that there is a likelihood of inconsistent methodologies between sources. Additionally, we acknowledge that the conclusions presented here could be calculated using a variety of different methodologies. To mitigate these effects on our conclusion, we sought middle ground by considering these data and calculations in what seemed the most fair and objective manner. This data could be skewed to make the cost savings appear significantly more or less than what has been presented here. For example: If we compared the actual G7 purchasing power parity (PPP) cost per person, we could conclude that the U.S. could save 54% or $1.296 trillion on health expenditures. Alternately, if we excluded the three lowest G7 health spending countries, we could conclude that the U.S. could save 31% or $744 billion on health expenditures. Instead, we choose to calculate estimates that seemed to be a reasonable average between high and low extremes.

Other calculations:

Simple math was used for the other calculations. For example, in the U.S. in 2007, there were 412,165 medical related bankruptcies averaging $44,622 each. Hence, the total estimated cost to the economy (number of bankruptcies x average cost of each bankruptcy) was $23,578,994,458.

Rounding:

For the purpose of the making this information accessible in different ways, some of the calculations have been rounded. For example, the statement "$2 out of $5 spent on health care is wasted." says that 40% is wasted, which in this context is roughly the same thing as 38%.

Health Care Expenditure Comparisons in G7 Countries

Health Care Expenditure Comparisons in G7 Countries: Percentage of GDP
	U.S.	Average of:	France	Germany	Canada	Italy	U.K.	Japan	SOURCE
2006	15.3%	9.5%	11.0%	10.6%	10.0%	9.0%	8.2%	8.1%	1
2000	13.2%	8.7%	10.1%	10.3%	8.8%	8.1%	7.1%	7.7%	1
Health Care Expenditure Comparisons in G7 Countries: Average Cost Per Person (AER)
	U.S.	Average of:	France	Canada	Germany	U.K.	Italy	Japan	SOURCE
2006 (US$@2006 AER)	$6,719	$    3,413	$ 3,937	$ 3,917	$ 3,718	$3,332	$2,813	$2,759	1
2000 (US$@2000 AER)	$4,570	$    2,133	$ 2,193	$ 2,080	$ 2,371	$1,782	$1,547	$2,827	1
AER = Average Exchange Rate: Average exchange rate of a currency over the course of a year
Health Care Expenditure Comparisons in G7 Countries: Average Cost Per Person (PPP)
	U.S.	Average of:	Canada	Germany	France	U.K.	Italy	Japan	SOURCE
2006 (US$@2006 PPP)	$6,719	$    3,098	$ 3,673	$ 3,465	$ 3,420	$2,815	$2,631	$2,581	1
2000 (US$@2000 PPP)	$4,570	$    2,267	$ 2,514	$ 2,670	$ 2,542	$1,846	$2,061	$1,967	1
PPP = Purchasing Power Parity: Series from 2005 International Comparison Project est. by the World Bank

U.S. Health Care Expenditures

Health Care Expenditures in the U.S.: Projected 2009-2019
	Total(a)	Population(b)	Per capita(c)	SOURCE
2009	$                        2.6	307	$                     8,469	2
2010	$                        2.7	310	$                     8,710	2
2011	$                        2.9	313	$                     9,265	2
2012	$                        3.1	316	$                     9,810	2
2013	$                        3.3	319	$                   10,345	2
2014	$                        3.5	322	$                   10,870	2
2015	$                        3.8	325	$                   11,692	2
2016	$                        4.0	328	$                   12,195	2
2017	$                        4.3	331	$                   12,991	2
2018(d)	$                        4.5	334	$                   13,473	2
2019(d)	$                        4.8	337	$                   14,243	2
(a) = trillions $US@2009 (b) millions (c) = US$@2009 (d) = 2018, 2019 est. via data trend

Health Care Expenditures in the U.S.: Projected 2010-2019 - Calculations
		SOURCE
Health care spending percentage increase 2010-2019 (real pct. w/o inflation)	63.5%	2
Health care spending percentage increase 2010-2019 (pct. w/ 3% inflation/year)	93.5%	2
Money avg. U.S. resident will spend on health ins. in next 10 years (US$@2009)	$            113,594	2
Money avg. U.S. resident will waste on health ins. in next 10 years (US$@2009)	$              45,438	2
Average per capita yearly income (2009 est.) (US$@2009 @ PPP)	$              46,400	3
Health Care Expenditures in the U.S.: 2008 Comparisons
	billions (US$@2009)	SOURCE
U.S. health care expenditure: Total (2008 est.)	$                2,400	2
U.S. health care expenditure: Needed (2008 est.)	$                1,400	1 & 2
U.S. health care expenditure: Wasted (2008 est.)	$                   912	1
U.S. National Defense Budget: Total (2008 est.)	$                   616	2
U.S. GDP (2008 est.)	$              14,610	3

U.S. Residents and Health Insurance: Comparisons, Facts, Deaths and Bankruptcies

U.S. Residents and Health Insurance: Comparisons and Facts
		SOURCE
U.S. population: Without health insurance(2007)	47 million	2
U.S. population: With health insurance (2007)	255 million	2
U.S. population: Total (2007)	302 million	2
Percentage of U.S. population without health insurance (2007)	15.6%	2
Deaths resulting from lack of health insurance (2006)	22,000	4
U.S. Bankruptcy and Health Insurance
		SOURCE
Medical bankruptcies as percentage of total (2007)  (78% had health ins.)	62.1%	5
Percentage of medical bankruptcies where filers had health insurance	78.0%	5
Total medical bankruptcies (2007)	528,416	5
Medical bankruptcies where filers had health insurance (2007)	412,165	5
Total bankruptcies (2007)	850,912	5
Average cost of medical bankruptcy (2007)	$                    44,622	5
Cost of medical bankruptcies to U.S. economy (2007)	$       23,578,994,458	5

U.S. Health Rankings

U.S. Health Rankings: 2009
	Country Ranking	SOURCE
U.S. ranking in world: Life expectancy (2009 est.)	49 of 224	3
U.S. ranking in world: Infant mortality (2009 est.)	45 of 224	3

Sources & Terms