Universal Coverage

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The Development of Universal Health Care in Sweden

December 6, 2011 in International Health Care Systems | 2 comments

Sweden adopted universal health coverage in 1955.  How did the universal health coverage develop?  A 2004 World Health Organization report provides the answer.

Health insurance in the 19th century mostly occurred through mutual aid organizations, which paid out sickness benefits if their members became ill.  By 1885, about 10% of workers had joined “Friendly Societies.”  In the latter half of the 19th century, employers and unions began to create sickness funds for their workers.  Employers wanted to attract more workers; unions hoped to increase their member’s independence by reducing their reliance on employer-based schemes.  In 1891, the government not only recognized these societies, but began to offer subsidies to help finance their operations.

“Over  the next 40 years, government legislation moved steadily toward realizing the goal of universal effective health insurance coverage.  Early regulations sought to reduce the number  of societies so that they could achieve economies of scale. The government also gradually increased the number and categories of individuals who were required to  have coverage. A gap emerged between professionals with individual contracts and  manual workers with collective contracts, with the former enjoying a higher level of insurance coverage, particularly with regard to sick pay. Sweden almost enacted a universal insurance system in 1935, but the economic crisis in that period forestalled adoption.  The legislation establishing a universal system was finally passed in 1946 and implemented in 1955.”

The CIA World Factbook provides some additional facts on the Swedish healthcare system:

  • Health Spending: 9.9% GDP
  • Taxes: 53% of GDP.
  • Health Revenue derived from county taxes: two-thirds
  • Share of local budget dedicated to health: 85%
  • Life Expectancy: 81.07 years
  • Total Fertility Rate: 1.67

Source: William Savedoff, Tax-Based Financing for Health Systems: Options and Experiences, WHO Discussion Paper, 2004.

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Universal Coverage in Thailand

July 13, 2009 in Health Care Around the World | 3 comments

Puenpatom and Rosenman (2008) examine universal health coverage in Thailand:

“In 2001 Thailand became the first developing country to introduce universal health insurance coverage (UC). Six of 76 provinces adopted UC in April 2001, while the remaining provinces implemented UC in October of that year. One of the key elements of the program is capitated-based reimbursement of public hospitals based on enrolled populations in the hospitals’ service areas. Before 2001, the only capitation-based public health insurance program was the Social Security Scheme (SSS), which covered only 9% of the population in 2000. With UC fully implemented almost 90% of the population is covered by capitation. UC capitation is geographically structured so hospitals have fixed revenues based on the local population and financial viability depends on an ability to control costs. One consequence is that hospitals face increased demand from the 75% of the population previously not covered by any formal insurance system.”

Hospitals

This table shows the distribution of hospital beds. About 75% of all beds are in government hospitals and about 21% are in private hospitals. Most public hospitals are run by the Ministry of Public Health (MOPH). Larger regional hospitals provide tertiary and primary care services. Bangkok has a unique structure within Thailand. Most large teaching hospitals are in Bangkok and forty percent of private hospitals are located in Bangkok. Under the new UC system, patients are assigned to hospitals by MOPH.

Physicians

“Physicians in Thai public hospitals are employees of the hospital and as such are paid by MOPH according to budgetary structures through the hospitals.”

Old System vs. New System

This table gives a comparison of health insurance coverage under the old an new system. In 1991, two thirds of Thais had not health insurance. By 2000, only 20.3% of Thai individuals were uninsured. After the enactment of Universal Health Coverage (UC), this number fell to less than 4%.

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5 Health Care Myths

January 12, 2009 in Healthcare IT, Obesity, Physician Compensation | No comments

Bob Laszewski has a great posts on 5 false  “solutions” to reduce health care costs.  These are:

  • EMR: Making electronic medical records universal will greatly improve health care quality, but the impact on cost will be minor.  Better quality care can reduce iatrogenic injuries and reduce cost, but the cost reduction–if any–will likely be small in magnitude.
  • Prevention.  From the CBO: any gains from reducing obesity would be concentrated in the short and intermediate period “because some of the savings will be offset by increased longevity and the cost of disease that are most prevalent during old age.”
  • Outcomes Research:  Laszewski claims that “inefficient use of technology is the key driver in health care spending accounting for an estimated 38% to 65% of spending growth.  The problem…with the suggestions that more outcomes research will save us money is that more than twenty years of outstanding outcomes research, Dartmouth for example, has not kept our health care costs under control.”  Outcomes research is important; it is imperative for physicians to prescribe cost effective treatment.  However, I agree with Laszewski that if financial incentives are not aligned to promote physician use of evidence-based medicine, then health outcomes research will have little impact.
  • P4P: Laszewski doesn’t like pay-for-performance because in order for it to save money, it must lead to a reduction in physician payment on average.  Another reason why P4P won’t work is that paying individuals to check a diabetic’s A1C level may increase the frequency the physician monitors this metric, but it also may compel the physician to substitute their time away from other necessary medical services.
  • Universal Coverage.  Universal coverage should reduce the percentage of individual who go to the emergency room for primary care needs;.  Nevertheless, providing universal health insurance coverage will certainly increase healthcare spending due to the moral hazard problem as well as supplier-induced demand.

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