IFHP Survey of Medical Costs by Unit Shows Price Differences of More Than 300 Percent Between Countries

SAN FRANCISCO, Nov. 22, 2010 – The International Federation of Health Plans today released its 2010 Comparative Price Report detailing its annual survey of medical costs per unit. The study is done to help member plans better understand why health care costs are so much higher in some countries than others. Prices for the same medical procedures, tests, scans and treatments vary widely from country to country. The survey data showed that average U.S. prices for procedures were once again the highest of those in the 12 countries surveyed for nearly all of the 14 common services and procedures reviewed.

For example, total hospital and physician costs for delivering a baby are $2,147 in Germany, $2,667 in Canada, and an average of $8,435 in the United States. The survey shows that the cost for a hospital stay is $1,679 in Spain, $7,707 in Canada, but these costs can range from an average of $14,427 to $45,902 in the United States. The survey also found that the cost of a widely prescribed drug like Nexium can range from $30 in the United Kingdom to $186, the average cost in the United States.

In addition to providing comparative cost data across the countries, the survey provides information about the wide range of costs being charged in the United States for common services, procedures and drugs. One example from the survey is hip replacement surgery which cost $12,737 in the Netherlands, but ranged from a low of $21,247 to a high of $75,369 in the United States. Five percent of U.S. prices are higher than $75,369.

The differential between unit prices was greatest for surgery, according to the survey data. One of the highest differentials was for cataract surgery hospital and physician costs. The range for cataract surgery ran from $1,667 in Spain to an average of $14,764 in the United States.

IFHP will host a conference call and Webinar with Chief Executive Tom Sackville at 9:30 am Pacific Time today to discuss the findings. Details for joining the conference call and Webinar follow at the end of this news release.

“As countries around the world look at the impact of their health care systems on their economies, the cost per unit of services, procedures and drugs is a key factor that needs to be understood. The total cost of care in each country is obviously driven very directly by the fees charged by the doctors, hospitals, and drug companies in that country,” said IFHP’s Sackville. “We hope the release of this updated report on our price survey will be a key step forward in creating a more informed base of knowledge for all our member countries and allow them to better assess the impact of unit prices on the cost of health care.”

The IFHP’s survey covers current 2010 provider fees and drug costs in 12 countries. Items examined include angiograms, CT and MRI scans, office visits, newborn deliveries, appendectomies, cataract surgeries, hip replacements, hospital stays, bypass surgeries and angioplasties. Costs for three widely prescribed drugs – Lipitor, Nexium and Plavix – were also reviewed.

Countries studied included Argentina, Australia, Canada, Chile, France, Spain, Switzerland, Germany, Netherlands, New Zealand, United Kingdom and United States. The data for the report was gathered from IFHP member organizations in each country.

The International Federation of Health Plans was founded in 1968 by a group of health fund industry leaders in fifteen countries, and is now the leading global network of the industry, with nearly 100 member companies across 30 countries. IFHP aims to assist in the maintenance of high ethical and professional standards throughout the industry.

For a copy of the report and more information about IFHP, please visit www.ifhp.com.