In the richest country in the world, health care costs have skyrocketed while many health outcomes remain stubbornly poor. The United States spends more per person on health care than any other high-income nation — yet Americans live shorter lives, their infants die at higher rates, and many avoidable deaths still occur. This is a paradox: pay more, live less. In this article, we’ll set the scene with the headline numbers, compare the U.S. against five peer nations (Canada, United Kingdom, Germany, France and Japan), examine why the discrepancy exists, and consider what lessons the U.S. might borrow. By the end, you’ll better understand how cost, access, equity and outcomes interrelate — and what can be done to correct the course.

1. Quick snapshot: Dollars vs Outcomes

Let’s begin with the big picture. According to the latest data from the Organization for Economic Co‑operation and Development (OECD), the U.S. spent approximately USD $12,555 per person on health care in recent years. OECD+2OECD+2 By contrast, the average among OECD countries was just under USD $5,000 per person. OECD
As a share of gross domestic product (GDP), the U.S. still leads: about 16.6% of GDP on health care, compared to around 9–10% for many peer nations. OECD+1
Yet the return on this investment is far from commensurate. For example:

• Life expectancy in the U.S. is about three to four years below the average of other high-income nations. Commonwealth Fund+1
• Infant and maternal mortality rates are higher in the U.S. than many peer countries.
• Many “amenable” deaths (those avoidable through timely access to high-quality care) are more common in the U.S. than in its peer group. These juxtaposed data points – of highest spending and middling or poor outcomes – set up the paradox we’re examining.

2. Who are the peer nations and why they matter

The five countries I’ll compare with the U.S. are: Canada, United Kingdom (UK), Germany, France, and Japan. These nations were selected because:

• They are all large, advanced-economy, industrialized countries with mature health systems.
• Their data are readily available and comparable via OECD and other international databases.
• They represent different models of health-care financing and delivery (single payer, social insurance, mixed public-private) which helps illustrate structural alternatives to the U.S. system.
  A quick sketch:
• Canada: predominantly publicly financed, single-payer approach for hospital and physician services.
• UK: the National Health Service (NHS) provides largely universal coverage, largely tax-funded.
• Germany: statutory social insurance system with sickness funds, regulated private insurance for higher incomes.
• France: statutory insurance plus complementary private insurance, strong focus on access and regulation.
• Japan: universal health insurance, strong cost controls, high life expectancy.
  By looking at how these countries allocate resources, structure access, and deliver outcomes, we can frame how the U.S. differs — and identify where the U.S. might adjust.

3. Where the U.S. spends money — drivers of high costs

Why does the U.S. spend so much more than peer countries? Several structural drivers stand out:

1. a) Higher prices rather than dramatically higher utilization
   According to analyses from the Peterson‑Kaiser Health System Tracker, the U.S. spends roughly twice as much per person as comparable countries, and much of that difference is due to higher payments to hospitals, physicians and for medical goods and services — not simply more frequent use. Health System Tracker+1
   In fact: “The U.S. spends twice as much as comparable countries do on health, driven mostly by higher payments to hospitals and physicians.” Health System Tracker
2. b) Administrative and overhead burdens
   High administrative complexity in the U.S. multi-payer system contributes significantly to excess cost. For example, prescription drug spending, provider employee wages, and governance/financing administration are all higher than peer countries. Commonwealth Fund+1
   Moreover, the U.S. pays more for the same services in many cases — imaging, surgeries, specialist visits — than comparable nations. wikipedia.org+1
3. c) Fragmentation, market power and weak price controls
   Unlike many peer nations where the government or regulated entities negotiate or set prices for drugs, devices and services, the U.S. has less centralized bargaining power. Combined with provider consolidation, this drives up cost.
   d) A higher share of specialty care, and less emphasis on primary/preventive care
   The U.S. has a relatively lower ratio of primary-care physicians and fewer systemwide controls on specialist vs generalist supply, leading to costlier patterns of care. OECD+1
   In sum, the U.S. pays more for many of the same inputs and services that peer nations pay less for — and the extra cost is not uniformly delivering better health outcomes.

 

1. Outcomes that matter: Life expectancy, infant mortality, chronic disease & avoidable deaths

Simply spending money is only useful if it improves outcomes. On key indicators, the U.S. lags.

Life expectancy
Despite the U.S.’s high spending, life expectancy in the U.S. is lower than many peer nations. A recent Commonwealth Fund brief states: “In 2020 life expectancy at birth in the U.S. was 77 years — three years lower than the OECD average.” Commonwealth Fund
Other countries such as Japan, France, the UK and Canada achieve life expectancies in the low-to-mid 80s, so the U.S. falls behind even though it spends far more.

Infant and maternal mortality
Infant mortality (deaths under age one) and maternal mortality in the U.S. are higher than peer countries. For example, comparisons between Canada and the U.S. show Canada’s infant mortality rate is lower despite lower spending. en.wikipedia.org
These measures are sensitive to access, prenatal care, early life interventions — all areas where access and equity matter.

Avoidable/Amenable mortality
“Preventable” or “treatable” deaths — those that would not occur if timely and effective care were available — remain higher in the U.S. compared to many peer nations. While the U.S. has strengths in acute care (some metrics are better than average), the broader picture shows many sooner deaths that could have been avoided. OECD+1
Chronic disease and health span
Beyond raw life expectancy, the quality of those years matters. Americans may spend more years in poor health, living with chronic disease, disability or limited mobility — reducing “health span” even if “lifespan” improves modestly.

Key take-away: High spending alone does not guarantee better outcomes. The U.S. pays more but ranks worse on many of these “hard” health metrics.

5. Access and equity: Who’s left behind?

One of the strongest differentiators between the U.S. and peer countries is how access and equity are handled.

Access in the U.S.
Despite programs such as Medicaid and Medicare, the U.S. remains the only high-income country in this group where a substantial portion of the population lacks any form of health insurance. Commonwealth Fund
Even for those insured, high out-of-pocket costs, deductibles, copays, surprise bills and network limitations can limit effective access to care.

Equity gaps
In the U.S., access and outcomes vary widely by income, race, geography and insurance status. For example, life expectancy for non-Hispanic Black Americans and Indigenous populations is several years lower than for non-Hispanic White Americans. Commonwealth Fund
Such inequities translate into lower outcomes, and higher avoidable costs (both human and economic).

Peer nations’ access models
In Canada, UK, Germany, France and Japan, coverage is universal or near-universal; cost-sharing is lower; and more of the population is routinely covered for essential services. This helps ensure that preventive care, timely interventions and chronic-disease management are less disrupted by financial barriers.

Trade-offs
To be clear: no system is perfect. Some peer nations deal with trade-offs such as longer wait times for certain elective services or restrictions on specialist access. But on the whole, they combine more consistent access with better outcomes relative to their spending.

6. Quality of care vs delivery: The U.S.’s strengths and weaknesses

While the U.S. health-care system is often criticized, it also has genuine strengths.

Strengths

• High-end specialty care and advanced technology: the U.S. leads globally in some complex treatments, research and innovation.
• Some outcomes in acute specialty situations (for example, certain cancers, advanced surgical techniques) can be among the best in the world. The OECD country note reports that the U.S. performed better than the OECD average on 57% of key access/quality indicators. OECD

Weaknesses

• Primary care under-emphasis: The ratio of generalists to specialists in the U.S. is lower than in many peer countries; coordination of care is more fragmented.
• System fragmentation: Many payers, many rules, administrative complexity; lack of continuity in care across settings.
• Underinvestment in preventive care and social determinants (housing, nutrition, education) relative to what the spending suggests.
• Some care processes may be efficient, but the broader system fails to deliver the consistent population-health returns that peer systems achieve with less money.

7. Why spending more hasn’t fixed the problems — structural and policy explanations

If the U.S. spends more, why aren’t the outcomes correspondingly better? Several structural and policy factors help explain the gap.

Misaligned incentives
The U.S. system largely uses fee-for-service reimbursement, rewarding volume over value, and has less centralized coordination of care. Incentives thus encourage more procedures and more expensive care rather than efficient care.
Social determinants of health
Health outcomes depend heavily on non-medical factors: housing stability, education, income security, food access, environment, social cohesion. Many peer nations invest more proportionally in social care and upstream interventions; the U.S. relatively under-invests in these areas compared to its health-care spending.
Lack of effective price negotiation and regulation
Many peer nations use government negotiation for drug prices, standardised fee-schedules for providers, and tighter regulation of provider prices. The U.S. has less centralized bargaining power and fewer effective price controls. For example, retail prescription-drug spending per person is more than double among OECD peer countries. Commonwealth Fund
Administrative inefficiencies and system complexity
Multiple payers, complex billing, fragmented systems increase overhead. Analysts estimate that a significant portion of U.S. health spending may be “wasted” on administrative overhead rather than useful care. en.wikipedia.org+1
Delayed access and fragmented preventive care
When primary care and preventive care are under-leveraged, conditions worsen, costs escalate, and outcomes degrade. The U.S. has higher rates of avoidable admissions and complications even though spending is high. OECD

8. Options and lessons from peers: What the U.S. could borrow

The good news: the U.S. can learn from peer systems. Here are some practical areas for reform.

Price negotiation & cost containment
Several peer countries centrally negotiate drug and device prices or set schedules for provider payments. The U.S. could adopt stronger federal negotiation or reference-pricing schemes.
Universal or near-universal coverage + access equity
Covering more people and reducing financial barriers to care is critical. Canada and the UK illustrate models where access is not dependent on employment or multiple private insurers.
Strengthen primary care and prevention
A shift in emphasis from speciality/high-cost care to strong primary care, early intervention and chronic-disease management helps reduce avoidable admissions, complications and costs.
Reduce administrative complexity
Streamlining payment systems, reducing duplicative billing, standardising claims processing and consolidating administrative tasks can free up resources for direct care.
Address social determinants of health
Investing in housing, food security, education and community support can improve health outcomes and reduce costs long-term.
Trade-offs and tailoring
No one model fits perfectly. The U.S. must adapt lessons to its political, demographic and institutional realities. Reforms may be incremental, targeted and politically feasible rather than wholesale overnight change.

9. Myth-busting and common pushbacks

When discussing U.S. reform, certain arguments often surface. Let’s address a few:

Myth: “We pay more because we use more technologies and specialists.”
While utilization plays a role, the bigger driver is higher prices for the same services. The U.S. pays significantly more than peer countries for hospital stays, outpatient visits and medications. Health System Tracker+1
Myth: “Other systems ration care.”
It’s true some peer systems may wait longer for elective procedures or limit specialist choice, but many achieve equal or better population-health outcomes (life expectancy, infant mortality) for far less spending. The key is system design, not just fee suppression.
Myth: “We can’t copy another country’s model — the U.S. is unique.”
Yes — the U.S. is large and diverse, with a different history and institutional setting. But many policy mechanisms (price negotiation, universal coverage, streamlined administration, stronger primary care) are adaptable. Learning from others does not mean full replication.

10. Conclusion and Call to Action

The bottom line: The United States is paying the highest price in health-care spending among wealthy nations — yet consistently under-delivering in key health outcomes. That mismatch isn’t just an economic issue; it’s a moral, social and public-health challenge.
To change the trajectory, the U.S. must:

1. Move to more affordable, equitable coverage so access is reliable for everyone.
2. Bring spending under control by negotiating prices, reducing administrative waste and shifting toward value-based care.
3. Invest more upstream — in primary care, prevention and social determinants of health — so healthier populations reduce demand for expensive reactive care.

Call to Action: Share this article, subscribe for our in-depth health-system briefs, and download our free infographic comparing U.S. spending and outcomes versus peer countries (available below). Then reach out and tell your policy-makers: “We pay more — we should get more.” Only when citizens are engaged will policy change follow.