Preker, Alexander Shalom
(1991)
Public financing of health care in eight Western countries: The introduction of universal coverage.
PhD thesis, London School of Economics and Political Science.
Abstract
The public sector of all western developed countries has become increasingly involved in financing health care during the past century. Today, thirteen OECD countries have passed landmark legislative reforms that call for compulsory prepayment and universal entitlement to comprehensive services, while most of the others achieve similar coverage through a mixture of public and private voluntary arrangements. This study carried out a detailed analysis of why, how and to what effect governments became involved in health care financing in eight of these countries. During the early phase of this evolution, reliance on direct out-of-pocket payment and an unregulated market mechanism for the financing, production and delivery of health care led to many unsatisfactory outcomes in the allocation of scarce resources, redistribution of the financial burden of illness and stabilisation of health care activities. This forced the state to intervene through regulations, subsidies and direct provision of services. Expansion in prepayment of health care gradually occurred through private insurance, social insurance and general revenues in response to different socio-economic, political and bureaucratic forces. Although improving health may have been the ultimate goal, offering universal access to affordable health care was the way the countries examined achieved this objective. Universal comprehensive coverage was associated with a decade of stable public expenditure on health care compared with GDP, total government expenditure and government consumption expenditure. There were no disproportionate increases in health care expenditure or displacement of public funds away from social programmes that depended on cash transfer payments. Nor do the countries that offer such social protection have higher public debt or poorer economic performance compared with the rest of the OECD. Measures of health status are unfortunately still not sufficiently developed or standardised to permit a detailed analysis of this aspect of outcome through cross-national comparisons. Furthermore, the countries examined may be more vulnerable to political backlash because of the high visibility of their government involvement in health care financing.
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