Link between health spending and life expectancy: US is an outlier

The graph below shows the relationship between what a country spends on health per person and life expectancy in that country between 1970 and 2014 for a number of rich countries.

The US stands out as an outlier: the US spends far more on health than any other country, yet the life expectancy of the American population is not longer but actually shorter than in other countries that spend far less.

If we look at the time trend for each country we first notice that all countries have followed an upward trajectory – the population lives increasingly longer as health expenditure increased. But again the US stands out as the country is following a much flatter trajectory; gains in life expectancy from additional health spending in the U.S. were much smaller than in the other high-income countries, particularly since the mid-1980s.

This development led to a large inequality between the US and other rich countries: In the US health spending per capita is often more than three-times higher than in other rich countries, yet the populations of countries with much lower health spending than the US enjoy considerably longer lives. In the most extreme case we see that Americans spend 5-times more than Chileans, but the population of Chile actually lives longer than Americans. The table at the end of this post shows the latest data for all countries so that you can study the data directly.

Life expectancy vs. health expenditure over time, 1970-20141


[This graph and more information can be found in the entry on how healthcare is financed.]


Please see more in the blog by Max Roser here.

It is also interesting to see the UK Health Accounts for comparison here.