Coverage
Financing
Almost all persons over the age of 65 are automatically entitled to Medicare part A. It provides coverage of inpatient hospital services, up to 100 days of post-hospital skilled nursing facility (SNF) care, home health services, and hospice care. Patients must pay a deductible each time their hospital admission begins. Medicare pays the remaining costs for the first 60 days of hospital care. A limited number of beneficiaries requiring care beyond 60 days are subject to additional charges. Patients requiring SNF care are subject to a daily coinsurance charge for 21-100 days .
Part A is financed primarily through the HI payroll tax levied on current workers and their employers. Employers and employees each pay a tax of 1.45 % on all earnings, as in 2000. The self-employed pay a single tax of 2.9% on earnings, as in 2000.
Part B is voluntary. All persons over the age of 65 and all persons enrolled in part A may enroll in part B by paying a monthly premium.
Part B provides coverage for physicians’ services, laboratory services, durable medical equipment, hospital outpatient department services, and other medical services.
Part B is financed through a combination of monthly premiums levied on
programme beneficiaries and Federal general revenues.
Beneficiaries’ premiums have generally represented about 25% of part B costs; Federal general revenues account for the remaining 75%. (House Ways and Means Committee, 2000)
➢ Medicare
Medicare is a nationwide health insurance programme for the aged and certain disabled persons. The programme consists of two parts: Part A - hospital insurance (HI); Part B - supplementary medical insurance (SMI).
➢ Medicaid
Medicaid is the health program for eligible individuals and families with low incomes and limited resources. The Medicaid programme began in 1965. It is administered by the Centers for Medicare and Medicaid Services (CMS) of the U.S. Department of Health and Human Services and jointly funded by the states and federal government.
Medicaid aims to help low-income groups to pay for their medical expenses, which is different from hospital insurance in Medicare. Although both of them are health insurance, Medicaid provides health insurance to the low-income people of all ages whereas Hospital Insurance in Medicare is for individuals aged 65 and above or with disability.
The eligibility of individuals and families are determined by the states.
Each state has its own requirements and procedures of application.
If the applicants are receiving social security from the Social Security Administration, he/she is eligible for Medicaid. Generally speaking, it is provided for the low-income families, the disabled person in need of long-term care and the elderly in need of medical assistance and long-term care.
Medicaid does not pay money to the applicants. It directly pays the service providers. In some services, the applicants also need to pay a small proportion of the fee on their own.
2. Social medicine approach
Since health services are necessities for maintaining life and relieving suffering, everyone is entitled to reasonable access to health care, regardless of the ability to pay, e.g England, Canada.
✐ England
Policy Making
and Delivery Policy Making Delivery
Department of Health.
Several types of statutory organisations (in particular strategic health authorities and primary care trusts) are responsible for providing or ensuring the provision of healthcare services in their respective geographical areas.
Healthcare Financing
Guiding Principles
Share of Financial Responsibility
Policy Evaluation
Hospital services
Achievements Primary health services
Medicines
Challenges
Tax-based financing system.
General taxation, national Insurance premiums, health insurance plans and out-of-pocket payments.
To provide universal services for all people based on clinical need, not the ability to pay, because health care is a basic human right.
To provide access to a comprehensive range of service through primary and community health care and hospital-based care.
Public hospital services for eligible persons are free of charge unless they choose to be treated as private patients.
Faster accessibility to the National Health Services (NHS).
Enhancement of the health status of the overall population.
Increasing number of people adopting healthier lifestyles.
Fully subsidized by public money, patients receive primary healthcare services provided by private medical practitioners free of charge.
Patients are required to pay a flat rate for each prescription.
Owing to the exemptions granted to specific groups such as children and low-income families, around 85% of the prescription items dispensed are free to patients.
Deficit/overspending of the NHS organisations
The National Audit Office and the Audit Commission recommend that the NHS financial regime should provide right incentives for best practice to enhance the quality of service and clinical productivity; and develop a more transparent financial reporting system to have an early identification of the financial problems of the NHS organisations and prompt reaction to
3. Mixed Mode Approach
Essential health services are available with reasonable access regardless of the ability to pay; but private health services are available to whoever could afford to pay or with insurance coverage, e.g Hong Kong, Australia.
✐ Australia
Policy and Delivery of Health Care
Guiding principle
Healthcare Financing
Commonwealth government
State and territory governments
Australian Health Minister’s Conference
Funding sources Type of financing system
Holds the overarching responsibility for making and administering nation-wide health financing policies.
Administers healthcare financing schemes.
Facilitates universal access to health care while allowing choice for individuals through substantial private sector involvement in delivery and financing.
Formulates policies governing the delivery of healthcare services and regulation of health-related personnel and premises.
Delivers healthcare services.
Offers a platform for health ministers of various levels of governments to discuss health policies and programmes.
General taxation.
Medicare levy.
Health insurance plans.
Out-of-pocket payments.
Tax-based financing system.
Share of financial responsibility
Policy Evaluation
Hospital services
Achievements Primary healthcare services
Medicines
Challenges
Public patients in public hospitals are free of charge.
Private patients in either public or private hospitals receive 75% government subsidy on medical services and cover all other costs by out-of-pocket payments and/or health insurance.
Increasing private sector involvement in the delivery and financing of healthcare services.
Increase in the take-out rate of health insurance.
Patients receive government subsidy to cover 85% of the cost on private out-of-hospital services and the remaining 15% is covered by out-of-pocket payments but not by health insurance.
Medical safety net will provide assistance to those patients with difficulty in handling payments.
Patients are required to make a co-payment for acquiring government-subsidized prescription medicines.
Pharmaceutical safety net will assist patients in making the co-payment.
Corresponding increase in government expenditure on rebate.
Higher-income households receiving a larger rebate.
Lack of incentive for insurersto manage high-cost cases cost-efficiently.
Some professionals in the healthcare sector expect that the healthcare reform will encourage more patients to use the private services in order to reduce both the financial and workload burden on the public sector. In the healthcare reform, the competitive but complementary roles between the public sector and the private sector are under discussion.