13.) Social Insurance Flashcards
What are the features of a Bismarck social health insurance system?
Universal insurance: all of the population have health insurance coverage
Community rating: financing of health insurance coverage is primarily through payroll and other taxes rather than premiums based on health risk of the insured person
Regulated private health care provision: hospitals tend to be privately run, prices set by the government
What are the rules a Bismarck model has to follow?
Minimum standards: every insurance contract required to meet minimum standard of care
Open enrolment: insurers may not reject any eligible customers
Community rating: insurers cannot set premiums using risk rating
Compulsory participation: customers are mandated to have insurance coverage at all times
What is risk selection?
When insurers seek low-risk customers and avoid high-risk customers in the hope of reducing expected expenditures.
How can risk selection be eliminated?
Set up a national fund to reimburse sickness funds with greater numbers of sick customers. But then no incentive for insurance funds to operate efficiently. Risk adjustment: the practice of compensating sickness funds with high-risk customers using payments from funds with low-risk customers based on predicted costs, not actual costs.
What is a Beverage system?
System run on taxation, zero price at the point of use, State ownership. Tighter cost control, potential for lower service quality.
