Health Care Systems in the United States and Australia

Health, as defined by the WHO in 1948, is a state of complete physical, mental and social well-being of an individual and not just the mere absence of infirmity. Health is an essential entity of every country, and the governments are tasked and mandated to ensure that every one of its citizens has access to this crucial service. This need prompted the development of different models of healthcare systems. Health care system is defined as the whole group of persons and organizations whose sole purpose is to promote, restore or maintain health (Health Systems Strengthening Glossary, 2018). This definition has since evolved to include prevention of poverty due to health-related problems. Healthcare systems are tasked with health service provision, overall system oversight, managing the healthcare resources and health system financing that includes protecting citizens from bankruptcy due to medical costs. Given the centrality and gravity of this precious commodity, the research on the provision of health is paramount. To this end, this research is aimed at exploring the types of health care systems employed by the US and Australia, how they are financed, the scope of services provided and health care funding priorities available in the two nations. In addition, this inquiry will highlight the primary health care providers in both the countries as well as examine the comparative strengths and weaknesses of both systems

All the over 200 countries have different health care systems with different local variations (Santerre & Neun, 2012). These systems can be categorized into four basic models.

The Beveridge Model 

In this model, health care provision is the sole responsibility of the government. To this end, citizens pay tax and the government pays for their healthcare. Most but not all hospitals are under the government that controls what the doctors do for the patient hence deciding how much they are remunerated.

The Bismarck Model 

Healthcare costs in this model are covered directly by the patient and his or her employer usually through payroll deductions. Here, healthcare is privatized, and insurance is offered to all citizens. However, the government controls insurance and caps the costs of healthcare.

The National Health Insurance Model 

This is a mix of the Bismarck and Beveridge models. The provision of the services is privatized, but the government pays for the services. The citizens pay taxes to fund this process.

Out of the Pocket Model 

In this model, the patient directly pays for their medical needs. Healthcare provision is more market-driven with little to no government input. This model is common in the underdeveloped countries where the rich access care as they can afford while the poor find it challenging to get health services (Islam et al., 2014). It is common in places where the government cannot adequately cover its citizens’ healthcare needs.

Healthcare System in the US 

The healthcare system in the US is complex employing many different types of basic systems. There is no single health care system for the whole country with some “special groups” being given care by the government and the rest procuring healthcare on their own. In the recent past, the government has tried to harmonize this with the Obamacare Act of 2010. However, the healthcare system remains a market-based system with many of the citizens (about 26 million people) still not having universal access, and that number could soon rise (Ben, 2002).

There are two primary public healthcare systems currently in the United States, the Medicare, and Medicaid (Eliot 2013). Both the systems were developed in the 1960’s and are run by the US federal government and the department of health and human services. Medicare primarily serves the senior citizens above the age of 65 and has several care plans namely Medicare plan A, plan B, plan C and plan D, all of which are available to the citizens.

Medicaid is provided by both the federal and state governments and targets the less fortunate in the society, the poor with low income and few assets. This system is focused on Americans under the age of 65 with incomes of up to 133% of the federal poverty level (Barnett & Marina, 2016). It is largely variant across states as it is state-controlled with beneficiaries having, in theory, vibrant healthcare services with most services. Legibility is different among individual states.

Apart from the two major systems, the US also has other systems such as the TRICARE, a civilian healthcare system run by the department of defense serving the military and their immediate families, and the Veteran Health Association run by the military retirees and the Department of Veteran Affairs.

Community-based not-for-profit organizations also play a significant role in American health. These organizations have received much attention recently as they help provide affordable care to citizens. The US census bureau stated in 2015 that up to 67 % of the population had private insurance. The Obamacare initiative rose the numbers of citizens with some form of health insurance to about 90.9 percent as of 2015 (De Lew, Greenberg & Kinchen, 1992).

Healthcare System in Australia 

Australia has a national healthcare system called the Medicare founded in 1984 to ensure access to quality and affordable healthcare by all Australians. It offers free hospital treatment as a public patient and subsidizes medical and pharmaceutical services. It is administrated by the various levels of government: the federal, territorial, state and local governments. The national healthcare system is supported by private healthcare insurance and injury compensation insurance for access to health care as private patients. Medicare has three parts namely: medical services that cover visits to medical practitioners, prescription pharmaceuticals and hospital treatment as a public patient that is co-funded with state governments. The federal government is responsible for the national policy formulation, healthcare service funding, the regulation of products services and workforce. The local and territorial governments are tasked with infrastructure and delivery of public health services to the citizens. The national health system covers all Australian citizens, residents with permanent visas, enrolled New Zealand citizens and restricted access for citizens of select countries (Australian Government Department of Human Services, 2018).

The Australian government also provides affordable access to necessary and cost-effective prescriptions to Medicare legible individuals through a pharmaceutical benefits scheme. The prices are subsidized, and when the yearly limit is reached, those legible get subsequent prescriptions free of charge.

The private insurance system offers a voluntary option and a more extensive choice range to the Australian citizens as it covers both hospital and ancillary health requirements either partially or fully. As of 2015, almost 45% of the population had private insurance cover (PHIO 2015). Private insurance offers flexibility in the choice of hospitals and practitioners to their clients. A majority of the Australian population (almost 67%) have general treatment cover (APRA, 2016)

Financing of the Systems 

The Australian Medicare health system is financed in part by a government levy collected through a tax system. The citizens pay 2% of their taxable income and a further surcharge of up to 1.5% for individuals earning above $ 90,000 and families above 180,000 but do not specify hospital cover level (AIHW, 2016). Private Citizens are required to pay out of their pockets the gap fee that is charged over the scheduled fee. The government encourages able citizens to take up private health insurance by levying a surcharge penalty payment above a certain income level. Private insurance is deducted from the client’s income to later fund their medical needs as per the agreement.

In the United States, however, most health care is financed by out of the pocket payment by those who can afford, that is, privately funded healthcare or through private insurance that they pay for. The Medicare system is financed through a combination of payroll taxes, premiums and federal general revenues while taxes finance the Medicaid system by the states under federal government regulation. Currently, Medicare is on full federal government support, but gradual phasing out of the support is expected to be effected by 2020. Private insurers are subject to varying state and federal regulations and are directly under state insurance commissioners. These insurers are either for-profit or non-profit and though they can be paid by individual clients themselves through voluntary tax-exempt premiums, the costs are mostly shared by employers and their employees on the basis of mutual agreement. The cost of the care is controlled by a scheduled government fee that is subject to review based on the current market trends and practitioner needs.

Scope of Services and Healthcare Priorities 

The United States Medicare program covers hospitalization, physician services, prescription drugs and some preventive services through a cost-sharing deal. It also covers post-acute care but not long-term care. Medicaid offers most essential services including hospitalization and physician services plus other state variable benefits. The American system also provides a cover for the less fortunate in terms of a safety net that offers them emergency and essential care. This is done through community health centers and not-for-profit organizations. The funding is prioritized to preventive health care, emergency treatment, and research to help manage and avert threats.

The Australian Medicare system, on the other hand, provides medical services that include consultation of a general practitioner or specialist, hospitalization services for both acute and long-term management and pharmaceutical services for the provision of cost-effective essential prescription drugs. Currently, the government offers three safety nets namely the original Medicare safety net, the extended Medicare safety net and the greatest permissible gap. The government is also working on creating one single safety net that will reimburse up to 80% of health care costs above the annual expenditure. The system does not offer home-based care services for the elderly since this is the reserve of commonwealth home support program. However, it prioritizes the care of the mentally ill patients and emergency services for all.

Amounts Consumers Pay For Inpatient And Outpatient Care. 

Healthcare in the United States is significantly higher in cost compared to other developed countries. The average cost for inpatient care in the US ranges between 1831 USD to 2214 USD per admission. Most of the outpatient care is negotiated by insurance companies on behalf of the consumers and is reportedly lower.

On the contrary, healthcare costs in Australia are under tight control of the government with some specialties even going as far as signing not to go beyond the scheduled fee. The average per day for a private bed in a public hospital is about 250 USD and goes to up to 600 USD for a private hospital. The cost for outpatient care ranges from about 68 USD to 140 USD per visit depending on the level of the healthcare facility visited.

Primary Healthcare Providers and Their Roles in Each System 

The Australian healthcare system has general practitioners, specialists, and nurses as the major healthcare providers. The general practitioners are the perceived gatekeepers of the healthcare system as they provide primary care to the patients and decide if they need specialist review or inpatient care. The specialists are tasked with the overall management of the hospitals and the advanced care of patients. The nurses majorly play roles in the inpatient and home-based care of patients (Robinson et al., 2015).

In the United States, the health care providers are the general practitioners and specialists and the nurses in different capacities. The advanced nurses can provide primary care just as the general practitioners do and they assist and complement each other in caring for patients in the outpatient setups and referral of patients to specialists for advanced care. The specialists offer superior care to the patients according to their needs both as inpatient and as outpatients. The other levels of nurses are charged with the responsibility of caring for patients in the inpatient setup, nursing homes, and home-based care.

Comparative Strengths and Weaknesses of the Two Healthcare Systems 

The choice of the health system for a country is influenced by many factors, which include the social status and fabric of the country, the political forces and the demand of health plus how practical the system is for a nation. The United States lack of a national health system is disadvantageous to the citizens, as the systems in place do not protect them. This has caused the cost of healthcare to skyrocket compared to other countries. The lack of a policy in the country is also advantageous in that there is freedom by a majority to choose the preferred

healthcare provider. For Australia, the greatest strength of their system is the equal accessibility of health care to all citizens. This is reflected in the WHO survey that shows Australia as one of the healthiest nations worldwide. The weakness of this system is the lack of competition hence no urge to provide the best possible healthcare to the citizens unlike in the United States where the patients have access to high-quality technology interventions right where they are.

Conclusion

Different countries have different health care systems that suit their needs. As it has been demonstrated in this paper, Australia has the Medicare system that largely offers free hospital treatment to its citizens and subsidizes medical and pharmaceutical services. On the other hand, America employs both the Medicaid and Medicare systems with a host of other providers such as TRICARE. To this end, the system is primarily market-driven and is funded by out-of-pocket payments. As it has been shown in this inquiry, both the American and the Australian systems have their benefits as well as drawbacks

References

AIHW. (2016, September 13). Australia's health 2016. Retrieved February 23, 2018, from https://www.aihw.gov.au/reports/australias-health/australias-health-2016/contents/summary 

Australian Government Department of Human Services. (2018.). Retrieved February 23, 2018, from http://www.humanservices.gov.au/ 

Australian Prudential Regulation Authority, Australian Government, (APRA, 2016). Statistics: Private health insurance quarterly statistics .

Barnett, J. C. & Marina S. V. (2016) Current Population Reports, P60-257(RV), Health insurance coverage in the United States: 2015 , U.S. Government Printing Office, Washington, DC.

Ben, I. (2002). Healthcare systems: The USA. Updated by Emily Clarke (2011) and Elliot Bidgood (January 2013). 

De Lew, N., Greenberg, G., & Kinchen, K. (1992). A layman's guide to the US health care system. Health Care Financing Review, 14 (1), 151.

Health Systems Strengthening Glossary. (2018). Retrieved February 23, 2018, from http://www.who.int/healthsystems/hss_glossary/en/index5.html 

Islam, M. M., Yen, L., Valderas, J. M., & McRae, I. S. (2014). Out-of-pocket expenditure by Australian seniors with chronic disease: the effect of specific diseases and morbidity clusters. BMC Public Health, 14 (1), 1008.

Private Health Insurance Ombudsman, Australian Government, (PHIO, 2015),

Robinson, S., Varhol, R., Ramamurthy, V., Denehy, M., Hendrie, D., O'Leary, P., & Selvey, L. (2015). The Australian primary healthcare experiment: a national survey of Medicare Locals. BMJ open, 5 (3), e007191.

Santerre, R. E., & Neun, S. P. (2012). Health Economics: Theory, insights, and industry studies. Cengage Learning.