Article at a glance:

The productivity of healthcare systems

As governments around the world attempt to reconcile the public’s desire for more and better health care benefits with the need to control spending, they must reevaluate their health systems. To provide a foundation for future reforms, during the late 1980s McKinsey assessed the performance of health care systems in the United States, Germany, and the United Kingdom in treating four diseases: breast cancer, diabetes, gallbladder disease, and lung cancer. Although conventional wisdom assumes the United States wastes money on health care, we found that the productivity of its systems was always higher than Germany’s and often higher than the UK's.

The take-away

In general, health care systems that adopt efficient new technologies sooner and move patients out of the hospital more quickly enjoy a productivity premium, even though their overall spending may be higher.