Health system financing Flashcards
what are the two processes of collecting resources
- Progressive
- regressive
Define what is a progressive way of collecting resources
- the proportion of income that is used to pay for care increases as income rises
Define what is a regressive way of collecting resources
- the proporiton of income that is used to pay care increases as income drops
- everyone pays the same amount
What are the ways to calculate total health expenditure (THE)
- absoulte number
- or percentage of GDP (this one is used most)
What are the different forms of financing GDP
- Taxation
- social insurance
- out of pocket payments (private)
What are the differnet forms of healthcare service provision
- Public
- Private
Name the types of health care access
- comprehensive
- selective - only allowed access to certain times
What questions should you ask when looking at health care fianicing
- is the country a high, middle or low income country
- what percentage of the health expenditure is the share of a countrys GDP
- how are the funds collected or how is the system financed
- how are services provided
What are the two ways to fund a health care system
- Privately fianced
- publicily fianced
- mixed
How can you privately finance a healthcare system
- out of pocket payments - co-payement and user fees and full payment
- Private health insurance - group/individual schemes and MCOs
How can you publicily finance a healthcare system
- Social insurance = single fund or multiple funds
- Taxation based systems = general taxes and hypothecated taxes
if you have less out of pocket payments you are
protecting the population more
What are the types of health insurance
- Private health insurance = voluntary
- Social insurance = compulsory
- community insurance - voluntary
What does the model of private health insurance assume
- the fee people pay will cover the administration costs and profit margins
What is the negative of private health insurance
based on ability to pay
How does private health insurance increase demand
- risk aversion - wont take everyone
- potential income losses - people will take health care insurance to prevent income losses
- lack of other protection options - have no where else to get medical care
What are the negatives of a private health insurance market
- Adverse selection - due to information asymmetry - might not diclose chronic illness to a provider therefore health insurance uses ratings
- those who are poor cannot get cover
- moral hazard due to absence of prices in the point of use - protecting against overuse
- diseconomies of scale - only have a certain number of providers therefore there is a fragmentation of resources
What is a rating in private health insurance
Price varies based on
- experience
- customer or group rating based on risks - such as age
What are the market defences that private health care insurance use to protect themselves
- deductibles - first bill to be paid by the insurer
- co-payments - every time you access the health service you have to pay a co fee
- disease or service exclusion lists - excludes specific diseases to be treated
- managed care - to monitor and supervise interactions between patients and doctors - can see if the doctor is giving you too much care
Describe how social insurance works
- linked with employment and the workplace
- therefore a healthy workforce can be seen as a profit maximising strategy
- compulsory - some have an income threshold option(in some countries high earners can opt out)
What are the advantages of social insurance
- everything from the wages that is collected is spent in healthcare
- evidence sugessts that spending per capita on health service is higher than in tax based systems
- increase equitable allocation of resources - access to the services is the same for rich and poor
What are the disadvantages of social insurance
- it is a form of employment tax
- the amount raised will vary folllowing employment rates
- risk of adverse selection if more than one social insurance fund
What happens in a community insurance
- Voluntary health insurance
- usually targets the informal sector or rural areas where people are not covered or there are user charges
- has been promoted as a form of financial protection for the most vulnerable and uncovered population
- usually cover a basic package of services
- micro-funded by government or NGOs
what are taxes
- compulsory payments directed by the state that do not confer any direct individual entitlement to specific goods or services in returns
describe a tax based health system
- Known as the beveridge model or the semashko model
- funded through taxation (direct and indirect taxes, general taxation and earmarked taxes, national or local taxes)
- universal and typically free at the point of use
- typically publicly administrated and decentralized
What is vertical equity in healthcare financing
- Whether people with different levels of income make appropriately different payments
What is horizontal equity in healthcare financing
- the extent to which people with the same income make the same payments
How can you measure the progressivity of healthcare financing
- Kakwani’s progressivity index
What is the progressivity of healthcare financing
- is a measure of vetical equity or in other words oh how payments vary by income
What is a proportional financing system
- The proportion of income paid does not vary with the level of income
What are out of pocket payments
- payments that are made directly by a patient to healthcare provider
What is the downside to having a high level of out of pocket payments
- if there is a high level then you are exposing the population to a market where they dont have enough information to particpiate
- causes high inequality
Name the type of out of pocket payments
- direct private payments
- co-payments
- user fees
- informal payments
Describe the type of out of pocket payments
- direct private payments = e.g. direct payments for private consultations with doctors
- co-payments = are direct payments made by the users of the health services as a contribution to their cost (usually covered by the insurance company) (flat rate)
- user fees = direct payments made by users of health services as a contribution to there cost (flat amount)
- informal payments - unofficial payments or envelope payments or under the table payments or gratitidue payments or bribes - are additional payments in a kind or cash made by users mainly to healthcare workers to ensure prompt attention or a minimum standard of care
