Dick, While it is an ICAO requirement, it's my understanding each authority can choose how to comply. I don't think the US filed a difference on this, they were just practical about how it was implemented.
When this requirement was introduced many authorities gave all of their existing pilots Level 4 and delegated to flight examiners the authority to issue to Level 6 as part of a flight review/competency test. I know this is how it's done in the US and the UK at least and so far as I know many other places.
I'm surprised that any US pilot doesn't already have at least level 4 on their licence. There should be no need for them to do any exam, once endorsed by their home authority this should be accepted world wide.
I think level 4 is the lowest acceptable level for aviation. Anything below Level 6 (which is the highest possible level) needs to be renewed, level 4 requiring renewal more often than level 5.
Any US pilot without English Language Proficiency (ELP) on their licence hasn't bothered to get their licence endorsed.
Otherwise I agree it is a waste of money.
P.S. I thought even CASA allowed flight examiners to accredit for ELP.