Sept. 18 (Bloomberg) -- Opponents of overhauling U.S. health care argue that Canada shows what happens when government gets involved in medicine, saying the country is plagued by inferior treatment, rationing and months-long queues.

The allegations are wrong by almost every measure, according to research by the Organization for Economic Cooperation and Development and other independent studies published during the past five years. While delays do occur for non-emergency procedures, data indicate that Canada’s system of universal health coverage provides care as good as in the U.S., at a cost 47 percent less for each person.

“There is an image of Canadians flooding across the border to get care,” said Donald Berwick, a Harvard University health-policy specialist and pediatrician who heads the Boston-based nonprofit Institute for Healthcare Improvement. “That’s just not the case. The public in Canada is far more satisfied with the system than they are in the U.S. and health care is at least as good, with much more contained costs.”

Canadians live two to three years longer than Americans and are as likely to survive heart attacks, childhood leukemia, and breast and cervical cancer, according to the OECD, the Paris-based coalition of 30 industrialized nations.

Deaths considered preventable through health care are less frequent in Canada than in the U.S., according to a January 2008 report in the journal Health Affairs. In the study by British researchers, Canada placed sixth among 19 countries surveyed, with 77 deaths for every 100,000 people. That compared with the last-place finish of the U.S., with 110 deaths.

Infant Mortality

The Canadian mortality rate from asthma is one quarter of the U.S.’s, and the infant mortality rate is 34 percent lower, OECD data show. People in Canada are also 21 percent more apt to survive five years after a liver transplant.

Yet the Canadian “bogeyman,” as U.S. President Barack Obama called it at an Aug. 11 gathering in Portsmouth, New Hampshire, may have “all but defeated” the idea of a public option in the U.S., said Uwe Reinhardt, a health-care economist at Princeton University in Princeton, New Jersey.

Senate Finance Committee Chairman Max Baucus, Democrat from Montana, introduced on Sept. 16 compromise health-care legislation that, unlike other House and Senate bills, omits a government-backed choice for the uninsured living in the U.S. who can’t afford private coverage.

Insurance Mandate

Private insurers, the pharmaceutical industry and the medical profession fear the “market power” of a public plan, Reinhardt said. They “deployed certain think tanks to find horror stories around the world that can be used to persuade Americans a public health plan in the U.S. would bring rationing.”

Given that Congress is likely to pass a mandate to cover the uninsured, Americans forced to buy policies will be left with no alternative to coping with “double-digit rate increases” on commercial premiums, Reinhardt said.

“Both systems ration medical care,” he said. “In Canada, they make people wait. In the U.S., we make people pay.”

Fifty-four percent of chronically ill Americans reported skipping a test or treatment, neglecting to go to a doctor when sick, or failing to fill a prescription because of the cost, according to a 2008 survey by the Commonwealth Fund, a foundation that focuses on health care, and pollster Harris Interactive. That was more than twice the number in Canada, data from those New York-based groups showed.

Payment Worries

As the price of health care in the U.S. has risen three to four times faster than the rate of inflation, surveys show that Americans have become concerned they won’t be able to pay medical bills. Forty-three percent of consumers in a June poll by the University of Michigan in Ann Arbor said they worried they might not be able to afford care, even with insurance.

“Canadians value fairness, and they cannot conceive of a system in which someone can’t get health care,” said Wendy Levinson, a Canadian who runs the department of medicine at the University of Toronto and worked in the U.S. from 1979 to 2001.

The U.S. spent $7,290 on health care for each person in 2007, 87 percent more than Canada’s $3,895, according to the latest OECD data. The U.S. also devoted the highest percentage of gross domestic product to health care, 16 percent, OECD numbers show. Canada’s expenditure was 10.1 percent.

Canada’s system consists of 10 provincial and three territorial nonprofit insurance plans that cover all citizens, including those with pre-existing conditions. It operates like Medicare, the U.S. program for the elderly and disabled. In Canada, the government uses taxpayer funds to pay claims by doctors, who mostly work in private practice or for a hospital and are paid fees for their services.

Effect of Technology

Care is free where it’s provided, as in a doctor’s office, except for dentistry, nursing home stays, prescription drugs outside hospitals, and rehabilitation services. The elderly and low-income residents get help with pharmaceutical purchases.

Technology partly explains the cost discrepancy between the two nations. There are 67 percent more coronary-bypass procedures in the U.S. than in Canada and 18 percent more Caesarean sections, OECD data show. In 2006, the U.S. had more than four times the number of magnetic resonance imaging units - - 26.5 for every million residents compared with 6.2 for every million in Canada -- making Americans three times more likely than Canadians to get a scan, according to the OECD.

In the U.S., technology is “overused” because doctors have to justify equipment purchases with revenue, according to Gerard Anderson, a professor of public health and medicine at Johns Hopkins University in Baltimore. Canada in the 1960s was about as expensive as the U.S., he said.

No. 1 in Cost

“The real difference has been their ability to control technology costs,” said Anderson, who directed reviews of health systems for the World Bank and developed U.S. Medicare payment guidelines for the Health and Human Services Department. “The only thing the U.S. is consistently No. 1 in when it comes to international comparisons with Canada and other OECD countries is cost.”

Less technology and, according to a 2007 report from the World Health Organization, 20 percent fewer doctors in Canada than in the U.S. have led to longer lines north of the border.

In 2008, 20 percent of chronically ill Canadians surveyed by the Commonwealth Fund reported waiting three months or more to see a specialist. Five percent of Americans polled said they had to wait that long.

Television Commercial

Washington-based lobbying groups including Americans for Prosperity and FreedomWorks have seized upon the delays, arguing that Obama’s proposal for a public option would eventually put private insurers out of business and force everyone to live with government-paid coverage and substandard care. FreedomWorks is led by Dick Armey, a former Republican congressman from Texas.

An educational foundation affiliated with Americans for Prosperity paid $3.3 million to run a 60-second television commercial on U.S. stations in which Shona Holmes, a 45-year-old native of Waterdown, Ontario, accused the Canadian health-care system of almost causing her to die by delaying critical treatment, according to Amy Menefee, a spokeswoman for the foundation. The ad ran for three weeks and was repeated on Sept. 9 after the president’s speech.

The TV spot first aired in May. Holmes, a mother of two and a self-employed family mediator, said in the ad that she went to the U.S. for care. She traveled 2,237 miles (3,599 kilometers) to the Mayo Clinic in Scottsdale, Arizona, and spent $97,000 for treatment of a benign brain tumor rather than wait for insurance-paid care in Canada, she said in a telephone interview.

Bridge to Canada

“I felt strongly I could speak out because I’ve seen both systems,” Holmes said. “I have seen how government involvement plays very negatively.”

Obama administration officials are trying to use the public option as “a bridge” to a system like Canada’s since “they realize it isn’t politically acceptable to go directly to that,” said Phil Kerpen, the director of policy for Americans for Prosperity.

In Ontario, where Holmes lives, the average waiting time for surgery to remove a tumor was 99 days in the second quarter, according to the Ontario Health Insurance Plan’s Web site. If a patient was willing to go closer to Ottawa, the wait was 36 days at Pembroke Regional Hospital Inc. in Pembroke, 460 miles from Waterdown and 93 miles northwest of the Canadian capital. Closer to Waterdown, a patient could go to St. Joseph’s Healthcare Hamilton, less than 10 miles away, with a 56-day wait.

Ontario Appeal

Holmes began speaking out publicly, she said, after she couldn’t get Ontario in July 2005 to speed removal of her craniopharyngioma, a type of slow-growing cystic tumor that can put pressure on the brain or optic nerve. She is now pushing for the province’s insurance plan to reimburse her for the money she spent on surgery, tests and follow-up, she said in the interview.

Andrew Morrison, a spokesman for the Ontario plan, said Canadians need approval before getting care outside the country if they want to be reimbursed. He declined to comment on the Holmes case. Lori Coleman, registrar for the Toronto-based Health Services Appeal and Review Board, which handles complaints about the Ontario plan’s eligibility and payment decisions, also declined to comment.

Even with the waits, a majority of Canadians balk at the idea of turning government insurance over to private hands. In a July Harris/Decima poll, 55 percent of respondents said improvement should be made through the public plan, while 12 percent favored a private solution.

Doctor Visits

In both the U.S. and Canada, 26 percent of people interviewed told the Commonwealth Fund survey of chronically ill adults they got a same-day appointment with a doctor when they were sick -- the lowest number in any of the eight countries polled by the foundation. Thirty-four percent of the Canadians said they had to wait six days or more, compared with 23 percent of the Americans.

Canadians visited their doctors more frequently: 5.9 visits per person compared with four for those in the U.S., according to 2005 OECD data.

The U.S. leads industrial countries in the portion of the health-care dollar devoted to processing claims and paying providers, the Commonwealth Fund said.

Private-insurance administrative costs in the U.S. are 12.7 cents of a dollar, and as high as 18 cents for some companies, said Karen Davis, president of the Commonwealth Fund. Government plans, including Medicare and Medicaid, spend 5.8 cents excluding costs of private drug plans, she said. In Canada 4.2 cents is spent on administration.

“If we lowered our administrative costs to that of the lowest three countries with mixed public-private health-care systems, we could save $50 billion a year,” Davis said. “This would go a long way toward financing coverage for the uninsured.”

To contact the reporter on this story: Pat Wechsler in New York at pwechsler@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net