always a mystery. >> we will have more next weekend. is you, jackie. make sure you have yourself a great week. i will see you back here next weekend. good night. >> welcome to a gps special. america's system of bringing us into this world and helping us stay alive and supporting us as we die is at a major cross roads. two years ago this week president obama signed the most comprehensive overhaul of medicine since medicare. the highest court in the land will hear arguments for and against obama's law and could strike it down.

our oust control health care costs continue to climb. no other nation spends more than 12% of economy on health care. america spents 17%. what's more, we don't really benefit from the huge price tag. our healthy life expectancy ranks only 29th in the world behind slovenia. our infant mortality is twice that of sweden and japan. what is our problem? in this hour and a time magazine essay, we will study other countries to find out what lessons we can learn with others. we will visit great britain, taiwan and switzerland to find out what the nations are doing right and wrong. we will show you interesting innovation going on back here in america. in one of the first most crime-ridden cities in the

nation. let's talk about the one thing americans are certain is bad. government-run health care across the atlantic. is the health service an evil death panel? let's take a look. >> during america's debate over health care reform, critics said krit an's system was a bureaucracy that rationed those in need. were they right? britain has a system as close to socialized medicine as any country gets. the government pays for everything and pays most of the doctors. consider this. compared to americans, the brits

have longer lifespans, a lower infant mortality rate and a health care system that consistently ranks higher on every measure. all this and everyone's care is covered. no payments to doctors, no monthly charges from the insurance company, no copays, no fees, nothing. at king's college hospital in london, nigel heaton performs a liver transplant surgery with a live donor. a young man is giving part of his liver to his younger brother. the liver is cut in half with one part for the younger brother and the other part staying in the donor. >> the liver is a remarkable organ. you can take pieces of the liver and it will function perfectly well. >> this transplant costs tens of thousands of dollars. under the national health service or nhs, the patient

doesn't pay a thing. >> when patients come to us, we only evaluate them from the point of view they need it. do they need a deliver transplant? the cost never comes into it. as a surgeon i love that. it means the focus is on the care that i can deliver. >> nobody pays a doctor's bill. people will go their entire life without paying a single up front cost. >> dr. clair is the chair of britain's royal college of general practitioners. >> the health service is fair. it means irrespective of what you can afford and irrespective of your illness, you can access health care. that is what we require. that is what is a fair and honest health system. >> compare that to theus where an estimated 137,000 people died over seven years because they were uninsured. of course the brits do pay for

health care in another way. with taxes. the sales tax is a whopping 20% and income taxes are as high as 50%. all of that feeds the health care. the nhs is the largest employer with well over one million people on the payroll. you think it would be inefficient. >> it seems they do things more efficiently and it doesn't work in health care. >> a former overseas bureau chief with the "washington post," two of the world's health care systems for his recent book, the healing of america. >> the least efficient payers in the world are the american private insurance companies. they have administrative costs of 20 to 30%, that's a 30% tax on every dollar you spend on health care. britain is socialized medicine and administrative cost is 5%. canada is private dollars and public payers. 6%. it turns out in health care,

governments are doing this more efficiently than our private sector. >> one reason is private insurers spend more money on nonmedical costs like ads and reviewing claims to help them stay profitable. another way governments can be more efficient, when they are footing the bill is having a more coordinated approach to health care. for instance, the nhs rewards primary care doctors with bonuses for achieving certain measures of good health like getting patients to quit smoking. that's money well spend because fewer sick people means lower health care for the country. on average, they spend about $3500 a person on health care. in the united states, we spend around $8500. >> the argument that the only way to make the system work, the only way to get costs is you have to be cruel and say i will

pay for this and not for that. >> that's true. the british said to me, we cover everybody. >> the so-called rationing of care is the british system's element. man in particular is at the center. >> we're do find ourselves up against everybody. the physicians and the patients and the media. it's sometimes a real challenge. >> andrew dylan is the chief executive for health and clinical influence known as nhs for short. they decide what treatments the government will and will not pay for. >> it's not about the money, but about the evidence for what works best. the clinical studies and the other research for us across the world. >> the evidence is weighed by independent panels that include

doctors and patients and not government bureaucrats. the addition making process is transparent. they can weigh in, but the policies involve some of the most veking moral dilemmas in medicine. a last line of defense, cancer drug. >> there is nothing else in lifelike facing death. we have to be sensitive to that. we try hard to be, but we need to make sure we are keeping our eyes on everything else. we need them to do that for us. >> long wait types for certain procedures. in the early 1990s, you could wait more than a year to be admitted to a hospital for a nonemergency. the nhs rule book gives patients the right to be treated within 18 weeks of that. that's a long time to be standing in the cube. britain's government-run system

provides good care for all and more cost-effective than one might imagine. the quality of care can shift as funding waxes and wanes. is there a way to provide care for all with less government? when we come back, we will visit a country that went from almost half the population being uninsured to nearly full coverage in less than a year and without breaking the bank. [ tires squeal, engine revs ]

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what would happen if a country were given a blank state to designer health care system. if it could choose from any nation in the world, which would it imitate. taiwan had that unique opportunity and the story prois eye-opening lessons for the united states. the economy like taiwan and singapore and south korea skyrocketed out of poverty in the 80s and 90s. they were growing at 7%, joining the ranks of rich countries. >> the country was getting richer and the insurance system was not all good at the time. >> a health policy expert at

princeton said 41% of they wan's population had no health insurance in 1995. >> we're paid out of pocket. for the really poor, you pray a lot. >> taiwan's government decided to reform the system of care from the ground up. a professor of economics at hard vard is a health care guru and provided a bold approach. >> we're provided the experts from the whole range of countries to throw out the lessons. their experience for taiwan. >> the battle considered the u.s. its close ally as a model for health care. they were not impressed. >> you can learn what not to do from the united states rather than learning what to do. >> they looked at great britain, but the brits's system was

producing long wait times in the 90s. >> bureaucracy is not the best or most efficient way of running on operations. >> there was germany which had private insurance and had so many different funds. their administrative costs were too high. they went with a single model where there was one insurer in the market, the government. they combined that with private hospitals to avoid too much bureaucracy. the system looks like american medicare and only for everyone, not just the elderly. taiwan's president at the time made a huge push to implement the plan quickly in 1995. miraculously taiwan's uninsured droped from 41% to 8% in less than a year. taiwan has a highly rated health care system. what's more, it's a rock star when it comes to holding down

costs. the taiwanese spend just 7% of their economy on health care. that's a sum compared to 17%. the government drives a hard bargain on fees with providers and taiwan can monitor spending with this cool device. the smart card. you swipe it any time you go to the doctor and he can pull up your medical history and when you are done, have a record that was day's visit and send an estimate for the bill to your government right away. officials know how much has been spent at any given time. compare that to medicare in the u.s. and that can only estimate spending levels two years after the fact. >> in taiwan, all of that is recorded. on a daily basis. >> wouldn't all of that government stinginess make it hard to see the doctor? surprisingly that's not the case. americans go to the doctor four

time a year on average. it wan ease go around 14 times a year. >> they stay in hospitals longer than americans stay. the average length for a taiwanese in a hospital is ten days. in the u.s. we are five days. >> how do the taiwanese provide all of that care for such low costs? one way is the doctors work their tails off. dr. gary lin's clinic is open 11 hours a day, six days a week. >> i take more than 200 patients a day. >> fees that government insurance pays doctors are very low. dr. lin gets $14 for each care visit. his colleague in the u.s. makes $100 per patient. they raised the insurance premiums to get more money into the system.

don't expect politicians to do something unpopular like that very often. >> taiwan's government succeeded in raising premium rates twice. just twice. >> no matter which health care system you visit, politics always comes into play. the next country woor r we are going to visit has remarkably similar politics to our own. it passed a version of obama care 18 years ago. has it worked out or is it a disaster? find out when we come back. m gld aflac pays cash. aflac! ha! isn't major medical enough? huh! no! who's gonna help cover the holes in their plans? aflac! quack! like medical bills they don't pay for? aflac! or help pay the mortgage? quack! or child care? quack! aflaaac! and everyday expenses? huh?! blurlbrlblrlbr!!! [ thlurp! ] aflac! [ male announcer ] help your family stay afloat at aflac.com. plegh!

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tea taiwan showed us government health insurance that can work. we searched the world for a completely private market. no government insurance or state-run hospitals. we found one in europe of all places. imagine an alternate universe where a version of obama care has been the law of the land for almost two decades. you haven't entered the twilight zone, you are in switzerland. >> around the time president clinton was pushing health care

reform in the 1990s, ruth dreyfus, a left wing swiss official was pushing reform. he faced a lot of tough questions. >> will we have to pay for the treatment of the drug addicts? will we have to pay for treatment of obese people? will we have to pay for abortion? >> switzerland is not your typical european welfare state. it's extremely business friendly and always gone its own way, shunning the euro and charting a course in health wear with private providers and private insurance. that's not so rare according to this journalist. >> one of the things many american believe that other rich countries all have socialized medicine. is that true? >> that's bologna. some do have them provide the care and pay for it. a lot of rich democracies like

germany and belgium cover everybody in the private system. private doctors, private hospitals, private insurance. germany and switzerland don't have medicare. people stay with the private insurance. >> the swiss were getting fed up in the early 1990s. costs were rising and premiums were disproportionately higher for women and the elderly and those with preexisting condition his trouble getting coverage. some were foregoing insurance all together. >> flying out of the insurance and we had to stop this. >> dreyfus who would become the first woman president push forward a law that required everyone to buy insurance and gave subsidies to the poor and rejected people for their medical history. sound familiar? that's exactly what president obama's law would do. in switzerland it was an uphill battle. the law passed parliament, but

barely squeaked by with 52% of the vote. >> nobody was really happy, but everybody could accept. >> how is the swiss version of president obama's law faring almost 20 years after it was put in place? everyone is now covered and the care is still top notch. the swiss enjoy one of the longest healthy life expectancies in the world. >> we have an extremely comfortable system. the access is easy. you don't have to wait. >> thomas was a swiss secretary of health from 1991 to 2009. >> hospitals have become more like five-star hotels, offering health care. part swiss law went above and beyond obama care. insurance companies were already banned from making a profit on basic health coverage. under the new law, they had to expand that basic package, covering more procedures.

>> even very expensive pharmaceuticals are paid by the insurance plans that have to be paid. >> the swiss system is world-renowned for the choice it provides users. >> i chose the doctor i wanted to go to and i went and it was seamless. >> we're caught up with jocelyn and her husband, two americans living in switzerland. she was expecting at the time. she could go see a specialist right away without waiting for a referral from her physician like in the u.s. >> i always waited hours in an overcrowded waiting room to see somebody then to see a specialist if anything was wrong. i don't have that here. >> another bonus, health insurance is not limped to employment. you can change your insurer every year if you want. >> the choice is such that it is sometimes confusing. you have in each town you are

living, a choice of probably 100 to 200 different plans. you need a coach or someone helping to you choose health insurance plans. >> experts worry that the swiss don't reap the savings from the choices because there so many of them. that might explain why costs are still very high. 11% of gdp. >> you cannot make it perfect, but you can make a perfectible law. any law has negative side effects and this is the lesson. we are still working to make this law better. >> health care costs are rising all over the world. in the united states health care is almost twice as expensive as everywhere else. why is that? we will explore that question next. ish. but when she got asthma, all i could do was worry ! specialists, lots of doctors, lots of advice...

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>> there is no greater threat to the american dream than the rising cost of health care. it already takes up around 1/5 of our economy. it could consume almost 2/5 crowding out vital spending on education, science and

technology, not to mention the military and social security. how on earth did we get here and what can we do about it? >> a big part of the underpinnings is all of us kidding ourselves. they are magically paying for us? no one is paying for this except all of us. >> the ceo of the game show network is an agitator in the health debate. he got involved after his father died from an infection while he was in the hospital with pneumonia. >> they had less impressive technology than my dry cleaner. a couple of times my father was taken for rode procedures meant for other patients. trash on the floor. this is the intensive care unit. >> the fate of his father is all too common. every year an estimated 100,000 americans die from an infection they got in a hospital.

>> once i got beyond the tragedy, i thought there is something unusual about this in the scope of how the world works. as i spent time thinking about health care, i began to think about the lack of real accountability to customers. the incentives that dominate the way the industry is structured. >> customers don't pay their own bills. it's a private insurance company or the government that pays. in the case of his father, medicare picked up most of the tab which was over $600,000 before a hospital discount. >> to all of us it seems terrific. i look at it differently. if medicare said to my mother, you pay the bill. the hospital came to my mother and said here's what we are changing for killing your husband, the collection would have been zero. no way my mother would have paid that bill. nobody would pay it. >> he summed up in an article

about how american healing care killed my father. he said if patients spend more of their own monohealth care, prices in the industry would come down. >> the basic argument is that the whole idea of using insurance to pay for health care is off. the problem with insurance is that it's very costly. it's a very cost leeway to finance anything. it's never used to finance anything outside of health care that is not major and rare and unpredictable. what you see is a system that lacks any of the normal disciplines we see. >> give me an example of some place where you find market forces can actually work the way you describe. >> around the frirchlgs of health care, things look like health care that are not in the economy. we see cosmetic dental surgery. cosmetic surgery generally. medicine for pets. what we see in the markets are

markets. >> lasik eye surgery, for example. since the procedure was introduced, prices have dropped considerably. just by the expensive equipment and well-trained specialists. lasik doctors compete for your business with ads that tell but their safety record and prices. >> ask a simple question of your viewers. how many of them know the safest hospital in their neighborhood? why not? why is there nobody with a billboard saying don't go to downtown, go to uptown. downtown will kill you. we have been through 45 years of turning over power to insurers to medicare and medicaid. look at the result. >> the solution, insurance should only cover catastrophic effects and serious illnesses and routine care like doctor's appointments should be paid for from a savings account that everyone controls. the poor would get subsidies.

>> we have to care about the cost. we are destroying the american dream. >> this is a surgeon, a staff writer for the new yorker and the author of several best-selling books on medicine. he agrees that the market in health care is not working. he said there is an important fact to consider. >> the sick account for most of the costs. 5% of patients or 50% of the costs. these are folks for whom the bills are 40 and $50,000. >> under his solution, limiting insurance to catastrophic events and serious illnesses, insurance companies would be paying for a lot of health care costs. figuring out how to treat the sickest of the sick he said is the trillion dollar question. >> the average patient who is elderly on medicare has more than ten specialist positions by their last year of their life. if have taken care of an ellerly patient, you want to tear your

hair out that they won't talk to each other. >> what the country need says more coordinated approach to care. some tend to prescribe too much medicine. that's less efficient, but it is more profitable. >> we have focused on getting the best drugs, the best devices and the best specialists and think little about how we fit it together. >> what is wrong with prescribing lots of procedures? the americans think of this as a case where more is better. why not have more mris? >> more at the right time is better. we are doing 70 million ct scans and a population of 300 million people. we know ct scans cause cancers and second, doing more of these kinds of tests end up raising maybe there is a spot there and maybe there is not. that leads to more surgery and more risks. >> a more coordinated approach to care may reduce needless

testing and lower costs. president obama's health care law encourages more coordination, giving funding to providers to come up with more efficient and effective ways to provide care. >> the concentration on the 5% of patients who are the highest cost patients and how badly we take care of them is unleashing enormous innovations and enormous reductions in costs. i think we are about to enter a period of rapid change. >> we will show you a bold example of that change. a health care experiment being conducted in one of the roughest cities in the country and it's working. tdd# 1-800-345-2550 let's talk about fees. tdd# 1-800-345-2550 there are atm fees. tdd# 1-800-345-2550 account service fees. tdd# 1-800-345-2550 and the most dreaded fees of all, hidden fees.

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i'm don lemon. here are the headlines. mitt romney has new momentum. he won an easy victory in puerto rico. he is expected to get all 20 of puerto rico's delegates. romney was endorsed by puerto rico's governor and also campaigned on friday and saturday. by cnn's estimate he has 518, more than double rick santorum a 239. all eyes turn to illinois that holds his primary on tuesday. the attorney for army staff sergeant robert bales arrives to prepare for the first face-to-face meetings with his new client. he is the soldier accused of killing 16 afghan soldiers.

he is in kansas and could be charged in connection with the deaths as soon as this week. a food of snow on the ground and another on the way. that's what people in flagstaff, arizona are facing. they had a rough time dealing with all that snow. rescue workers are on overload and miles of interstate 40 are shut down. it was good news for kids and getting a snow day on monday. those are the headlines this hour. keeping you informed, cnn, the most trusted name in news. skyrocketing health care costs created one of the biggest economic bubbles in history. doing nothing could lead to dire

consequences. that's why some providers are experimenting with innovative approaches to health care before it's too late. >> we are spending a lot more for health care and not getting our money's worth. that's a tragedy. >> the doctor is on the frontlines trying to reform a health care system that is called hopelessly broken. >> we spend twice as much and cover fewer people. >> he is tackling this disconnect in camden, new jer y jersey. one of america's poorest cities. he has been a family physician for 11 years. his mission started on this street in 2001. with a gunshot. an unark rabl sound in camden that has one of the highest murder rates in the country. >> i was sitting at my desk and shots ran out. >> he ran outside where the victim was in a pool of his own blood. no one was doing anything.

>> i started yelling at one of the sergeants, why didn't he do something? he didn't want to dislodge the bullet which was a blow off. it showed such lack of compassion and lack of concern for the dignity of people's lives. >> the victim was a product of camden. a senior at ruetkers university who had talked about running for mayor one day. his death triggered a passion to reform the camden police department. but he said it was mired in dysfunction. >> i threw my hands up and said i give up on helping to reform the police department at camden, but i can take a lot of the ideas that i learned in the process and bring them to healing care. >> he was mapping crime data to locate the city's most violent corners. just like the new york city police department did not 90s, producing great success. he started mapping health care spending, identifying hot spots

where the costs were the highest. using medical billing records, brenner found that just 1% of the patients accounted for 30% of health care costs in camden. that's not all he discovered about the city's three hospitals. >> we learned that someone went 113 times in one year and someone went 324 times in five years. in similar work up in trent on, they found someone who went 450 times in one year. >> these were people with complicated medical histories and chronic illnesses. one patient alone racked up $3.5 million in medical bills over a five-year period. >> they are the difficult patients to treat and no one is being paid and incentivized to pay attention to them. >> what's more, the problem is america's problem. 5% of americans accounted for half of our nation's health care costs in 2009. this is perhaps the crucial

statistic to understand about america's health care problem. if brenner could crack his city's crisis, maybe his model could help the country. >> we met with his primary care dock. >> he founded the health pride providers, a group of nurses and volunteers who treat the worst of the worst. one patient at a time. >> every day the group gets data from all of the city's emergency rooms in realtime. that's the first time this ever happened anywhere in america. jason is a former teacher and registered nurse is making a house call to 52-year-old lillian perez. >> hello. >> she was admitted to the hospital eight times last year. mostly for respiratory distress. she has a bucket full of

medications for chronic lung disease, sleep apnea and other conditions. >> can i see this? they got a ventilator placed in lillian's home. >> we are going to talk to you about the new ventilator. >> she saw her doctor whoa had only see her in the hospital every couple of months. we haven't seen you in a while. >> she stayed out of the er for 70 days and counting, a record for her in recent years. the city's sickest of often hard to reach. some don't have phones. jason and his team do routine drive byes to see patients like earl. >> jason from the coalition. how are you doing? >> he is one of the biggest er users in camden with a host of social conditions, hoo hez epilepsy, hypertension and congestive heart failure. >> it's one of those days.

the three amigos came early. >> that's the term he uses to describe the team that visited him earlier in the day. >> i know you are busy. >> despite the long odds, his hospitalizations decreased by 30%. he found that many expensive patients were concentrated in certain areas of the city. one building alone, a subsisized dour accounted for $12 million over five years. >> the patients were appalled that someone made that much money and yet they felt so sick. they still felt like it was so hard for them to access. pa. >> brenner set up a clinic in the building so that the rez depps can get preventive care. >> this is not a story of bad patients or bad doctors or bad hospitals and evil insurance companies. it's a story of a broken system that has irrational incentives and misaligned incentives so the patients are not getting their

needs met. >> brenner said that early evidence suggests his experiment is working. hospital use is down for participating patients. his model is being replicated in two other hot spots. these are bolstered by preventing and controlling illnesses instead of treating them. it was signed last august by chris christie with bipartisan support. >> rather than a cycle of failure, it creates a cycle where we are rewarded for doing the right thing. >> here's the problem. brenner's coordinated approach to reducing costs is essentially taking away patients and business from hospitals and doctors. that threatens the proves of most of the established players in health care. when we speak of reducing health care costs, remember that for

many powerful interests, that translates into taking away my business. if brenner succeeds in benning the cost curve here, it makes the rest of the country look silly if the city is able to reduce cost and improve quality and show this is is not a technical problem, but a spiritual and moral problem. >> i will give you my thoughts on the health care debate. stay with us. man, i'm glad aflac pays cash. aflac! ha! isn't major medical enough? huh! no! who's gonna help cover the holes in their plans?

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>> per after taking this tour of the globe and america, what is the best way to reform american health care? i am reminded of the old irish joke. a couple is lost and stops to ask a local the best way to get to dublin. well, i wouldn't start from here, he replies. america's health care system is a mess. it is partly free enterprise and partly state subsidized and highly inefficient in developing quality care at a reasonable

price. let me step back before making suggestions and outline a few principals. i'm a big fan of the free market. it has an almost magical ability to allocate resources and generate growth. for precisely because it is so powerful in places where it doesn't work well, it can cause huge distortions. the nobel price winning economist outlined in the 1960s why markets don't work very well when it comes to health care. he explained that people don't know when people know they will need health care and the cost is often prohibitive. you need some kind of insurance or a government-run system. now, if we decided as a society that it is okay that when people suddenly discover they need health care, dthey can get it i they pay for it, that would

work. the vast majority couldn't be able to pay for that triple bypass or hip replacement when they need it. the market would worng as it works for bmw. people who can afford it get it, people who can't, don't. every rich country in the world and many not so rich ones decided all should have access to basic health care. it simply can't work. remember even if one were to have only a catastrophic insurance model, that's where all the costs are. just 5% of the patients in the united states account for 50% of health care costs. taking care of these illnesses is what drives america's costs up. a general system only work fist everyone is insured. otherwise only the people who are sick want to buy insurance

and insurance companies will spend most of the time and effort trying to kick sick people off the system. that's why the heritage foundation, a conservative think tank came up with the idea of the individual mandate requiring that people buy health insurance in exactly the same way that people are required to buy car insurance. that's why mitt romney chose this as a market friendly system when he was governor and why newt gingrich praised the model as the most important step forward in health care in years. the obama bill expands access to 30 million americans. that's good economics and the right thing to do, but does little by way of controlling costs. there experiments and pilot programs and new trends such as the we saw in camden, but little in the way of systemic cost controls. that's largely a failure in the

entire political establishment. every expert realizes no matter what the system of health, you need to have some kind of board that decides what's covered and what's not. this is demetriagogued to make system work. no one is saying you can't get any medical procedure you want, merely that there some your insurance won't pay for. the shall unusual aspect is that buyers really don't have much knowledge or power. you can decide that you don't want a new car. you can comparison shop for a new tv and you can't decide thaw don't want a heart bypass. that's why costs have come down in optional areas like lasik surgery and not in ones where the consumer can't walk away. a final thought, one can reason

from first principals and that's a good thing. you must also reason from facts and the ground. the facts are that all rich countries try to provide affordable health care for their citizens some way or the other. all of them with free market havens like taiwan found they need to use an insurance or government sponsored model. all of them provide universal health care at much, much lower costs than we do. maybe there is a theoretical free market model that would work perfectly. right now in the world we are actually living in, some kind of mixed messy system is what we have and our task is not really to abolish it in favor of a utopia that might come, but favor it so americans can get good care like so much of the rest of the world.