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Friday, June 12, 2009

Health Care Funding By Governments

I write on several groups and forums; the most active ones are heavily US-oriented. As a result I have learned to automatically translate mg/dl to mmol/l and I understand that some parts of the world consider an entree to be a main course and that ketchup can be a staple food group. I also write on several UK forums.

Consequently, over time I have become well aware of the strengths and failings of both the US and UK health-care systems from a consumer's point of view as expressed by many diabetics in both lands. To a lesser degree I have read reports by diabetics in different Canadian Provinces commenting on their systems and from writers in Germany and the Netherlands on theirs.

I've noticed when the subject comes up the views of many writers in the US seem to be polarised. Some see any government involvement in health provision or funding as socialist. That is a word that US writers seem to define differently to the rest of the world. It seems, to an outsider, that it is considered to be socialism if the US Federal Government uses its authority or taxpayer's funds to support any activity other than Defence of the Nation or Foreign Affairs.

All governments have taxes; in democratic nations those governments usually spend the majority of those taxes on the services their constituents elected them to provide. Different countries choose different priorities for those politicians.

We are just one place you might compare to. Here, we choose to include basic Health-care provision as one of those priorities. However, unlike the UK, we have a strong parallel private health-care system which complements the public system.

I don't present the following as a criticism of any other system, but as just one example of the many systems operating around the world. Those in other lands may wish to use it as a basis for comparison and possibly as something they could learn from and improve on. Or not, as you wish.

Our system is not perfect and needs some major improvements. There are problems in some hospitals (which are usually administered by State Governments, but partly funded via Federal money) and shortages of medical staff in rural regions to mention just some of the shortcomings. A major part of the problem is the separation of Federal and State responsibilities, so quality of care can vary a bit between States.

I am sure that a search of our newspapers right now will find a crisis somewhere; there may be delays in elective (non-life-threatening) surgery, or delays with ambulance response, or insufficient beds or staff in certain hospitals. There is always something. But, every single time I, or a member of my family, has needed medical care we have received what we needed, when we needed it at a minimal financial cost.

This is a layman's description by a consumer; if any experts on the Australian system are reading this I am happy to be corrected if any errors are noticed.

I'm covered by the Australian Federal Government Medicare system (absolutely nothing like the US system by the same name). This web-page explains what Medicare covers, and this explains how Medicare works at the consumer level.

Included in the Medicare system is the Pharmaceutical Benefits Scheme. That provides heavily-subsidised prices to citizens for the majority of prescription drugs. The subsidies are greater for old-age pensioners, qualifying veterans and some others. Sometimes there are complaints that new drugs are not covered but usually they will be after safety and other considerations have been met. Of course, there will always be exceptions; for example it took years to add Lantus to the list.

An important sub-section of the PBS is the NDSS, the National Diabetes Services Scheme. That provides subsidisation of things such as blood glucose test strips, insulin consumables and similar items.

As I write this in 2009 the annual cost to the Federal taxpayer works out at about AU$3,400 per person. That seems pretty cheap to me when I compare with overseas prices. It is paid for by a levy on taxpayer's taxable income of 2%. I never found that onerous when I was fully employed and paying higher taxes than I do today, nor do I find it onerous now as a self-funded retiree. There are some State taxes involved too, but those vary by State and are difficult to assess for Health. They are certainly not at the same level as the Federal allocation.

Because I prefer to choose my own doctor, and also to avoid the possible delays I mentioned earlier in public hospitals, I choose to add Private Health Insurance. This is my own insurer; their premiums and benefits are representative of most: Defence Health Insurance. I've paid taxes since I was 16 years old; so I reckon I've paid my dues for Medicare. For the Private Health Insurance I pay top cover, which is about $200 per month for the two of us. That premium is also partly subsidised because it entitles me to some tax deductions in my annual tax return.

Between the Government cover and private insurance I don't get charged much for visits to the doc, medications, operations or hospital stays for myself or my wife. Additionally, for the leukemia and the diabetes I'm covered by DVA (Department of Veterans Affairs) so I pay even less for bills related to those, such as test strips. I paid those dues by serving for 20 years.

I'll repeat that our system is not perfect and needs some major improvements. But when I look at the financial and medical tragedy for those who are under-insured or unemployed in the US system; and the other extreme of the unwieldy inertia, restriction of treatment via the "post-code lottery"and bureaucratic waste of the UK NHS I'm very glad that I live where I live.

Everything has a price. Provision of a government healthcare system has a price; so does the absence of one. The first is paid in dollars; the second may be paid in misery.

Cheers, Alan
Everything in Moderation - Except Laughter

PS. For anyone interested in how the Australian system came into being, this links give an insight: 

Medicare - Background Brief

(edited to update and replace or delete changed links 12th March 2019)


Lazy said...

I don't know if you spotted this link I posted on ASD a couple of days ago about medical bills causing about 60% of bankruptcies in the U.S. The Tiny url link doesn't work I'm afraid it hasn't been working properly the last couple of times I have used it.

Supports you comments


Alan said...

Thanks. A very sad report.

Margie's Musings said...

After my husband retired in 1985, we had good health insurance paid my his company though Travelers Insurance. Several years later they dropped Travelers and took Met Life for their provider. This cost us $139 a month and it had a $1350 deductible. So for the next seventeen years, we paid the premium and never received a penny assistance for his health care. We also paid all medical bills. Through two surgeries for melanoma, and radiation treatments and surgeries for seven squamous cell carcinoma, the insurance paid nothing. Finally, I dropped it.

The doctors, upon learning that he had no supplemental insurance, all discounted the bills. So far, we have had no problem paying the medical bills ourselves. He is 79 and has diabetes, just diagnosed last fall. The metforum he takes for that cost us $4.00 at Wal Mart. We are both on Medicare.

I have a supplemental insurance that I bought from Blue Cross/Blue Shield. When I took it out at age 65, it was $87. a month. Now at age 73, it is $161. a month and goes up each year as I get older.
I have no health problems and take no meds so all that is outgo and is not used unless I get sick...which I very seldon do.

Neither of us has the prescription plan which was designed for the insurance companies to make massive profits because of the famed donut hole. It was also designed for Big Phama to make huge profits. The cost of meds are astronomical in America.

America's health care is not the best.

Except for the VA, Medicare and Medicaid (for the very poor) their health insurance is all through private companies.