Health Care Financing
Health Care Financing
Who Is Provided Access?
In a market based financed approach to healthcare, all individuals who are financially stable are able to access these services through employers or individually (Hicks & Jacobs, 2014). In a government-financed approach, the focus is aimed at providing healthcare services certain groups who include the low-income population, the elderly, and the disabled. These groups have a challenge in accessing quality healthcare services where the government comes in to help them in accessing these services (Hicks & Jacobs, 2014). An advantage of the market-based approach is that individuals are free to use this approach, as there are no regulations on who should join which is different from the government-financed approach (Hicks & Jacobs, 2014).
How Much Coverage Is Provided?
In a market based financing approach, medical services can be provided to all individuals who are able to afford the services. This also provides the opportunity for individuals to choose their choice of their physicians (Hicks & Jacobs, 2014). In a government-financed approach, the government moderates coverage and although most of the healthcare services are provided, there is a structured way of accessing some of the healthcare services with no option of selecting a physician (Hicks & Jacobs, 2014). Individuals get assigned physicians as well as the healthcare facility to access certain services. There are also limitations for patient appointments to certain healthcare services. Medicare covers do not cover some of the healthcare services, which forces patients to seek additional or supplemental insurance to cover the healthcare services (Hicks & Jacobs, 2014).
How Are The Services Paid For?
In a market-based approach, individuals pay healthcare services from their own private means of financing or from insurance providers (Clements et al., 2012). Medical administrators are able to make claims to the insurance providers based on the insurance coverage provided by the provider. In a government-financed approach, the government through money collected through tax does payment (Clements et al., 2012). The government through Medicaid also provides funds through insurance coverage, which is contributed by the individuals or the government. An advantage of the market-based approach is that the payment process is fast and efficient compared to the government-financed approach, which may take long to deliver funds to the healthcare provider (Clements et al., 2012).
How Does Reimbursement Apply?
In a market-based approach of healthcare financing, reimbursement is based on the medical insurance coverage of the individual receiving the healthcare services. Healthcare insurance providers have different reimbursement plans, which the individuals are able to choose, based on their cover and the plans provided (Clements et al., 2012). Due to the limited number of individuals in a market-based approach, reimbursement is usually fast and effective saving the resources required in providing funds to the healthcare providers. In a government-financed approach, the healthcare insurance providers have regulations to their programs on how reimbursement should be done (Clements et al., 2012). Different insurance plans have different reimbursement plans based on the rules guiding the programs. An advantage of the market-based approach is the fast and effective process compared to the government-financed approach, which is quite a complex and a long process (Clements et al., 2012).
Are There Limitations On Care?
Government financed healthcare has more control to healthcare services provided which may include a limitation to certain healthcare services, which is aimed at reducing the cost of healthcare provision (Hicks & Jacobs, 2014). Since the government has the responsibility of ensuring that all citizens have an access to healthcare services, the government to regulates the services they can finance for their citizens to address the issue of high costs, which may negatively impact the healthcare budget (Hicks & Jacobs, 2014). A market-based approach has no limitation to any healthcare services sought by individuals. This is because the patient’s financial status or insurance cover mainly determines access to healthcare services provided. The market-based approach is the best since patients are able to access any kind of healthcare services available (Hicks ; Jacobs, 2014).
What Guides Care Decisions For Patients?
In a market-based financed approach, the patients with the help of their physician are able to make decisions related to the present health concerns. This is because this approach gives an opportunity to the patients to be involved in the decision-making process, which is different in a government-based financed approach (Numerof ; Abrams, 2016). In a government-financed approach, the physician is responsible for all decisions related to the patient since not all services are available to the patients due to the financing options and the insurance coverage. Patients make decisions based on the recommendations made by the physicians (Numerof ; Abrams, 2016). The market-based approach is the best since it helps the patients participate in the decision-making process, which is important as it has an impact on the outcome of the healthcare process (Numerof ; Abrams, 2016).
What Is The Quality Of Services?
In a market-based approach, the quality of services is high due to the financial aspect associated with this approach. Most of the healthcare services are very expensive which also relates to the quality of the services (Numerof ; Abrams, 2016). The quality of services provided would also influence the number of individuals opting for this approach, which forces the healthcare providers to improve their quality of services. In a government-financed healthcare approach, the quality of healthcare services may be compromised due to the high number of individuals using this approach (Numerof ; Abrams, 2016). Due to the low premiums paid, either by individuals or by the government to support the certain groups, the quality of services provided may be low or limited compared to the market based approach (Numerof ; Abrams, 2016).
Are There Competitive Options?
In a market-based financed approach, there are competitive options due to the high premiums paid to the insurance providers and the high cost of healthcare services (Barr, 2016). Due to this, the healthcare providers face a lot of competition from other providers who are after the high revenues brought by the population who use these type of health care financing approach (Barr, 2016). In a government healthcare financed approach, there is no competition as the most of the services covered are limited and the process of accessing the funding is a complex long process (Barr, 2016). This discourages any competitors interested in the using this option. In a market-based approach, consumers are able to compare competitive prices, which is different in government-financed approach where consumers only access what is provided by the Medicare and Medicaid programs (Barr, 2016).
How Much Are Prevention And Wellness Emphasized?
A market-based approach has more emphasis on prevention and wellness since most of the providers have concentrated on helping individuals to stay healthier by using preventive strategies (Barr, 2016). These include incentives to encourage the individuals to access and implement preventive strategies, which are meant to lower the cost of healthcare provision. Government-based approach has also put more emphasis on prevention and wellness with the Medicaid program providing free visits to facilities to help in health improvement of its members. This is meant to lower the cost of addressing more serious healthcare issues to the healthcare insurance providers (Barr, 2016).
How Are Health Care Costs Managed And Controlled?
Market-based approach manages healthcare costs through premium rates transferred to the customers. If the costs of accessing certain healthcare services are increased, the premium rates are also increased with the same level (Numerof ; Abrams, 2016). There are costs which cannot be predicted which may lead to an increase in the medical fees charged. In a government-financed approach, there is a limit on the cost of healthcare provision (Numerof ; Abrams, 2016). For any increase in the cost of healthcare, there must be an evaluation, which is done every year to determine the fees with a consideration of other factors. Government financed is better compared to the market-based approach as funding is more flexible and costs are not transferred to the consumer (Numerof ; Abrams, 2016).
How Are Medical Advances Generated?
In a market-based approach, medical advances are generated thorough insurance companies where they use medical studies, which involve participation of the patients. The providers also provide financial incentives for new medical advancements, which help in a faster progress (Clements et al., 2012). A government-financed approach has a budget in place to direct and guide spending which makes it a challenge for generating medical advances. This budget is aimed at controlling costs and guiding spending on medical research (Clements et al., 2012). Both of the approaches have a disadvantage in that their focus is on reducing the cost of healthcare services, which is aimed at increasing their revenues and neglecting the consumer by not focusing on improving the healthcare services (Clements et al., 2012).
How Is Health Care Reform Established?
In both approaches, the healthcare reform is established after a careful analysis of its financial impact. This is based on the number of insured population compared to the quality of healthcare services provided to the individuals (Hicks ; Jacobs, 2014). This is the responsibility of the federal government, which aims to protect the consumer whether using a market-based approach, or a government financed approach. Most of the healthcare reforms will focus on the insurance providers as well as the plans available to individuals (Hicks ; Jacobs, 2014).
In a market-based approach, the consumers are provided with a range of different services, which are based on quantity rather than quality. One of the components, which require the most reform in order to finance a health care system that covers all, or most, people is the access to financing (Barr, 2016). Due to the competitive nature of this approach, access has been limited to the employed and those who have a high economic status in the community. The high cost is directly related to the freedom this approach has which includes the freedom to choose a physician that one wants and the freedom to choose certain medical procedures (Barr, 2016). This has locked out a large population, which include low-income families and the unemployed. One of the strategies to address this issue is to come up with a plan to allow every citizen to be able to access quality health care services regardless of their social status in the community (Barr, 2016).
The government-financed approach is a program meant to ensure that the minority have access to quality healthcare services regardless of their status in the society (Hicks ; Jacobs, 2014). However, this approach is based on regulations and rules set out by the government, which is not flexible, and individuals using this approach do not have the freedom to make certain decisions (Hicks ; Jacobs, 2014). One of the regulations include specification of those viable for the healthcare insurance coverage provided by Medicare and Medicaid programs who include the elderly, children, pregnant women, and the disabled (Hicks ; Jacobs, 2014). One of the components, which require the most reform in order to finance a health care system that covers all, or most, people is the coverage provided (Hicks ; Jacobs, 2014). The government-financed approach has limited coverage to certain healthcare services, which discourages and leaves other individuals out with no option since the market-based approach may have high premiums (Hicks ; Jacobs, 2014).
Barr, D. A. (2016). Introduction to US health policy: The organization, financing and delivery of health care in America. Baltimore: Johns Hopkins university press.
Clements, B. J., Coady, D., Gupta, S., ; International Monetary Fund. (2012). The economics of public health care reform in advanced and emerging economies. Washington, D.C: International Monetary Fund.
Cleverley, W. O., ; Cleverley, J. O. (2018). Essentials of health care finance. Burlington, MA: Jones ; Bartlett Learning.
Hicks, L. L., ; Jacobs, P. (2014). Economics of health and medical care. Burlington, Mass: Jones ; Bartlett Learning.
Numerof, R. E., ; Abrams, M. N. (2016). Bringing value to healthcare: Practical steps for getting to a market-based model. Boca Raton: CRC Press/Taylor ; Francis Group.