Health economics concepts and applications

Health Economics

A) How does the health system in the country you have chosen compare to that of the United States?

United Kingdom's National Health Service - NHS which became operational since 1948 is a model for the rest of the world envisaged to be a British Govt. supported, free service, based on community care equipped with general practitioners and community health centres at its hub. Over the years it has grown to be adjudged as the biggest governmental organization through the Department of Health - DoH across Europe with a workforce in excess of 1 million. Among the most important reform within the NHS is the shifting of the service planning authority and funding from the central establishments in London to regionally-based primary care trusts. The objective behind this move is devising healthcare services by keeping the patients in mind and placing them above all as per a report by the NHS. Strategic planning for NHS was entrusted to 28 new health authorities renamed as Strategic Health Authorities - SHA. (British Health System Shifts Authority to Local Agencies)

Every SHA's jurisdiction is nearly 1.5 million people and formulates plans for bettering local health services assuring that the quality of services is better and the main concern of the nation are integrated into local health service plans. British Govt. has assured that 75% of the NHS budget will be given to local health authorities. Decision is also taken by the primary care trusts as regards which secondary services to contract for. Secondary care is a specialized service under which comes mental health, integrated care, hospitals covered under NHS, and ambulance services. Individuals having acute mental ailments as well as severe psychotic ailments normally are recommended by their primary care physicians to specialists for mental health treatment as per the NHS. (British Health System Shifts Authority to Local Agencies)

While the British healthcare is a national system of publicly owned hospital and community services financed from the proceeds of central taxation, where the hospital physicians and nurses are Govt. employees under national terms and conditions of service, the U.S. healthcare system on the other hand is the most privatized one in the Western world with Corporations being its spine. These Corporations are responsible for operating hospitals, recruiting doctors, selling medicines and insurance, operating long-term care facilities. Having 4% of the world's population, the U.S. makes an expenditure of $1 trillion annually on healthcare, 35-40% of the worldwide spending. Costs towards healthcare accounts for 16% of U.S. GDP and 19% of net public spending; it is the biggest sector of the U.S. economy and is ranked 15th by WHO as regards global health standards. (Bad Medicine)

Whereas the healthcare system in the two nations differ -the NHS in UK being 'socialized medicine' while the U.S.A. being a 'market-driven' one dramatic resemblances are present between the two. For instance, while payments towards health insurance are deducted from the salaries of working Americans, similarly in case of 'national insurance' it is deducted from salaries of British workers. Employers, in case of both the nations, deposit this money either in favor of the insurance companies, or the Government, for buying insurance. While there are a lot of healthcare managers in America through a numerous federal and state agencies and private insurers, the British Govt. could apparently operate as a big integrated manager. Nevertheless, they are divided into regional health authorities and local primary care groups as well. In the past the existing procedure, which developed to put a check on unrestrained spending towards national healthcare, has seen endless waiting lists. Nevertheless, due to rising political arm-twisting to the extent that managed care concepts of cost efficiency and evidence-based cure have come to be central to the NHS policies which are presently surfacing. (a British-American psychologist on core assumptions of managed and suggestions for clinical program development)

B) What can you say about health care costs, access, delivery and quality?

Healthcare costs:-

In U.S. healthcare cost is high according to a survey where respondents were most probable to state problems for payment of steep medical bills. The data on OECD countries state that U.S. have the highest proportion of healthcare spending paid by the patients on their own. On the contrary able to pay prescription drugs seem to be a less critical problem in the UK where less than 10% stated that they had problems. 29% of the respondents belonging to U.S. stated that they paid in excess of $750 in the previous year and 8% mentioned that they dished out in excess of $2,000. UK provided the maximum protection against insurance coverage - 44% of British citizens stated that they did not have to pay anything for healthcare during last year and less than 1% stated to have incurred expenses of more than $750. The corresponding figures of U.S. speak that just 8% of the U.S. adults reported as not having paid anything.

Access to healthcare:-

In U.S. more than 1 out of 4 individuals reported at least certain problems in having access to healthcare for themselves or their next of their kin - which is once again higher compared to UK, where 15-20% of respondents reported problems. 1 out of 7 U.S. adults reported a period during the last 1 year when they failed to avail medical care they urgently needed. There were also reported problems in UK as regards visiting medical specialists or consultants. Availing the services of specialist doctor appears to be the most widespread problem. There were also differences between the two nations on the source of access problems. Access problems in the U.S. were stated to be mostly related to funds, with more than 50% respondents narrating lack of sufficient money or insurance to pay for care. In UK, long waiting times to receive medical car is a crucial hindrance while availing the required care. Waiting times to avail non-emergency care constitutes to be the longest in UK, where 33% of the respondents had to keep waiting for 4 months or more to receive non-emergency surgery as against 1% in the U.S.

Quality Ratings:

High quality ratings were given for U.S. As well as UK and in case of no country did more than 37% of respondents rate the healthcare they received as excellent. The experiences of the public with physician care varied as regards reported time devoted with the doctor and discernment of the sufficiency of that time. U.S. citizens were most probably to indicate that their visits with the doctor were very short duration; however they also had visits of longer duration with the doctors compared to other respondents. (the Cost of Health System Change: Public Discontent in Five Nations)

Can you describe any one market related to health care, for eg. Pharmaceuticals, labor market (training, supply, etc.) for doctors, nurses, etc.

Pharmaceuticals market:-

The UK market for Over-the-Counter - OTC pharmaceuticals continues to be rising in comparison to the properly developed markets of the U.S. The pharmaceuticals market is intricate and has a number of varied market sectors, the largest being analgesics and ache relief, coming next are cough cold and flu remedies. The market is influenced significantly by international pharmaceutical companies like Smithkline Beecham, Roche and Pfizer. (the UK OTC Pharmaceuticals Market: UK pharmaceutical market report) the pharmaceutical market is one of the most dynamic sectors of UK and global economies with the industry being extremely competitive, and pioneering R&D is crucial for success. It is forecasted that the total UK market for pharmaceuticals will rise by 6.7% to 7.7% annually between 2002 and 2006 with the prescription-only medicines showing highest levels of growth. (the Pharmaceuticals Industry Market Review)

US on the other hand hold a unique position being the largest market in the world and the sole nation with a market-based pharmaceutical sector. Due to U.S.'s free market for prescription medicines, its people have access to more treatments compared to any other people in the world. Nearly every pharmaceutical and biotech company sees U.S. As the launching pad for new products, making the country as the hub of global innovations. (Bio-Pharmaceutical Study Finds Significant Link between Innovation and Market-based Drug Pricing)

D) Demographics, for example future demands and needs of the health care system depending on mortality rates, population aging, decreases in birth rates, etc.

In nations where Infant Mortality Rates - IMR are fairly high but showing a declining rate, majority of the life expectancy during birth results from helping babies survive the early years of their lives. Due to increased healthcare facilities, reductions in maternal mortality also play a part for increased life expectancy at birth. While the nation's infant, childhood, and maternal mortality attain low levels, longevity gains at older ages come to be more marked contributors to increased life expectancy with life expectancy for U.S. being at 19%. On the other hand the residual life expectancy of a woman of 80 years in UK is roughly 50% higher in the present era compared to 1950 figures. (Global Ageing: The Challenges of Success) in the UK, the collective demands of an ageing population, mounting costs of healthcare and rising expectations are pulling the various healthcare services to burst at its seams. As a result, the Govt. has been eager to encourage self-medication, where probable, in an endeavor to save money and time as optimizing convenience for the consumer. (the UK OTC Pharmaceuticals Market: UK pharmaceutical market report)