SOC 3

Chapter 9

"Comprehensive BenefitsAnother important measure of health care systems is whether they offer all of theessential services individuals need. The difficulty lies in defining what is essential.Although all observers would agree that comprehensive health care must includecoverage forprimary care, agreement breaks down quickly when we begindiscussing specialty care. Some individuals, for example, consider coronary bypasssurgery an essential service, but others consider it an overpriced and overhypedluxury. Similarly, some favor offering only procedures necessary to keep patientsalive, but others support offering procedures or technologies such as hip replace-ment surgery, home health care, hearing aids, or dental care, which improvequality of life but don’t extend life.Any system that does not provide comprehensive benefits runs the risk ofdevolving into a two-class system in which some individuals can buy more carethan others can. To those who believe health care is a human right, such a sys-tem seems unethical. Others object to such systems on economic grounds, argu-ing that it costs less in the long run to plan on providing care for everyone thanto haphazardly shift costs to the general public when individuals who can’t affordcare eventually seek care anyway.AffordabilityGuaranteeingaccessto health care does not help those who can’t afford topur-chaseit. Consequently, we also must evaluate health care systems according towhether they make health care coverage affordable, restraining the costs notonly of insurance premiums but also ofco-payments, deductibles, and othercrucial services such as prescription drugs and long-term care. Although the ACAoffers some subsidies and tax credits to help people pay their premiums, it stillleaves millions with many bills for these latter costs.For health care to be affordable, individual costs must reflect individualincomes. As noted earlier, most insured Americans receive their insurancethrough employers. Typically, employers pay part of the cost for that insuranceand deduct the rest from each employee’s wages. Because low- and high-wageworkers have their salaries reduced by the same dollar amount, low-wage work-ers are effectively hit harder: Paying $3,000 per year for health insurance might,for example, force a wealthier worker to scale back his vacation plans but force apoorer worker to put off fixing his roof. For this reason, the US system is con-sideredfinancially regressivein that poorer people must pay a higher percent-age of their income than do wealthier people. In contrast, in countries such asGreat Britain and Canada, health coverage is paid for through graduated in-come taxes. Poorer persons pay alowerpercentage of their income for taxesand therefore for health care than do wealthier persons, creating afinanciallyprogressivesystem. Either way—whether through taxes or lowered wages—the nation’s citizens pay all the costs of health care" "Financial EfficiencyAnother critical measure of a health care system is whether it operates in a finan-cially efficient manner. Currently, the multitude of private and public insurers inthe United States substantially drives up the administrative costs of the health caresystem (Himmelstein et al., 2014). At the same time, the atomized and essentiallyentrepreneurial nature of our health care system makes it virtually impossibleto impose effective cost controls. For example, doctors have responded to financiallimits on Medicare payments by raising the fees they charge to non-Medicarepatients, a process known ascost shifting. Neither of these problems wasaddressed by the ACA.Consumer ChoiceFinally, we need to evaluate health care systems based on whether they offerconsumers a reasonable level of choice. Currently, wealthy Americans can pur-chase any care they want from any willing provider. In addition, Americans whohavefee-for-service insurancecan seek care from any provider as long as theycan afford the copayments and deductibles, and if their plan uses managed care,as long as their insurer approves the care. Finally, those who have Medicaid orMedicare coverage can obtain care only from providers willing to accept the rel-atively low rates of reimbursement offered by these programs, and those whohave no health insurance can obtain care only from the few places willing toprovide care on a charity basis. The ACA, however, does seem likely to increasethe options available for many Americans.As we will see later in this chapter, in Mexico, China, and the DRC, somecitizens have far greater choices in health care than do others, whereas inGermany, Great Britain, and Canada, all citizens have similar levels of health carechoice.HEALTH CARE IN OTHER COUNTRIESWith these measures in mind, we can now look at the health care systems inGermany, Canada, Great Britain, Mexico, China, and the DRC. Germany,Canada, and Great Britain are all considered to be more developed nations, andeach guarantees portable, affordable, and universal health care coverage to its citi-zens. In contrast, both Mexico and China may soon join the ranks of the moredeveloped nations. Mexico is gradually improving its health care system, butChina’s once exemplary record of providing health care to its citizenry has suf-fered recently. Finally, the DRC provides an example of the tremendous diffi-culties often faced by both the public and health care providers in theleastdeveloped nations. Despite their differences, however, most of the nations dis-cussed in this chapter combine socialistic and entrepreneurial elements" "health care systems. In contrast, health care in the United States and the DRC isprimarily organized as anentrepreneurial system, that is, a system based onprivate enterprise and the search for profit. Table 9.1 summarizes the character-istics of these six health care systems.Not surprisingly, each of the systems described in this chapter has changedover time. More interestingly, the changes seem to have moved various nationsat least somewhat towardhealth care convergence, that is, toward becomingmore similar to each other (Stevens, 2010). For example, the United States,Great Britain, and Germany all now utilizediagnosis-related groups(DRGs)to restrain costs.Two major causes of this convergence areglobalizationand economicpressures. Globalization has expanded access to medical and scientific knowledge.Increasingly, doctors use medical journals and Internet resources from around theworld to learn about new treatments. Similarly, medical and pharmaceutical cor-porations now market new technologies internationally. Thus, doctors in manydifferent countries are adopting the same technologies and placing similar eco-nomic pressures on their health care systems.Second, whether a country’s economy is booming or weakening andwhether its health care system is largely capitalist or largely socialist, the cost ofhealth care can press governments to reduce costs. Countries with largely capitalisthealth care systems may do so byrestrictingthe role of the market in health care,whereas countries with largely socialistic health care systems may do so byencour-agingthe role of the market in health care. The latter situation, in which countriesbegin encouraging the private purchase of health care, the private practice ofmedicine for profit, and the operation of market forces in health care overall, isreferred to as theprivatization of health care. As in the United States, privati-zation reflects aneoliberalperspective.Germany: Social Insurance for Health CareModern Germany is the product of a tumultuous twentieth-century history,including more than a decade of Nazism and the division of the country intwo after its defeat in World War II. Yet despite the destruction wrought bytwo world wars and the economic stresses that accompanied the reunificationof East and West Germany in 1990, the nation is a stable constitutional democ-racy and now enjoys one of the strongest economies in Europe. The grossnational income (GNI) per capita is $44,500, about one-quarter lower than inthe United States (Population Reference Bureau, 2014). (These figures aregiven in“international dollars,”in which $1 equals the amount of goods andservices one could buy for $1 in the United States.)Structure of the Health Care SystemHealth care in Germany is based on asystem of social insurance (Commonwealth Fund, 2013).Social insurancerefers to insurance provided by large social groups (such as regions, occupations,or industries) to their residents or members. This system was adopted in 1883 bypoliticians who hoped that offering workers accessible health care, as well"

"housing and unemployment and retirement benefits, would diffuse politicaltensions that might otherwise lead to a more radical redistribution of powerand wealth in German society (Leith et al., 2009). Social insurance remains thecenter of the current German health care system, although about 10 percent ofGermans now also or instead purchase private insurance.Purchasing CareAs in the United States, nongovernmental insurance formsthe basis of the German health care system (Leith et al., 2009). But whereas inthe United States, insurance providers must compete to survive in a profit-driven market, in Germany about 90 percent of health insurance is providedby nonprofit social insurance groups known assickness funds. As of 2010, allGermans earning less than about $70,000 must join a sickness fund. The costof belonging to a sickness fund is about 15 percent of income (about half paidby the individual for his or her entire family and the remainder paid by theemployer). Because costs are based on income, the system, like Britain’s, isfinancially progressive.Paying Doctors and HospitalsGerman doctors are paid differently dependingon the nature and location of their work. Those who work in hospitals receiveannual salaries. Other doctors typically are paid on a fee-for-service basis. How-ever, increasingly insurers are“bundling”payments, offering a set fee for doctorsand other providers, both in and out of hospitals, who together care for patientswith a specific condition such as diabetes or a hip joint that needs replacing. Thehope is that integrating care across various providers will result in better healthand lower costs. Hospitals receive their operating budgets from the sickness fundsand receive their capital budgets (for items such as new magnetic resonanceimaging machines) from the government.Access to CareAll Germans are required to have health insurance, and allGerman health insurance programs are required to provide a comprehensivepackage of health care benefits. With the exception of minimal copayments,insurance covers all costs of dental care, maternity care, hospitalization, outpa-tient care, prescription drugs, preventive measures such as vaccinations, andincome lost because of illness. As a result, Germans have few incentives to putoff obtaining needed care and see doctors an average of ten times per person peryear, more than twice as often as do US citizens (OECD, 2014). Germans cansee any doctors they like, although they must get referrals from primary caredoctors before seeing hospital-based specialists.Controlling the Costs of CareA major factor driving up costs of health carein Germany is the oversupply of doctors. To control this, Germany forbids doc-tors older than age 68 from working for the sickness funds, forbids doctors fromopening practices in areas where many doctors already practice, and pays doctorsby capitation rather than fee-for-service. Finally, to control drug costs, the sick-ness funds encourage doctors and consumers, through both education and eco-nomic incentives, to adopt more cost-effective drugs." "To control hospital costs, Germany now uses a system similar to the DRGssystem in the United States. In addition, the government can restrain thepurchase and use of unnecessary and expensive technologies because it deter-mines hospitals’capital expense budgets.Two factors still hamper efforts to constrain costs. First, hospitals haveopposed policies designed to shift care when warranted to less expensive outpa-tient settings because the hospitals fear their incomes will fall. Second, the vastnumber of insurance providers in the German system has kept administrativecosts high.Health OutcomesWhether because of its health care system or because of itshigh standard of living and commitment to providing social services to its popu-lation, Germany enjoys a very high standard of health. Although conditions inthe former East Germany remain poorer than in West Germany, those differ-ences are rapidly disappearing. Life expectancy in Germany now averages 80,two years more than in the United States (and with far less variation among itscitizenry). Infant mortality in Germany is among the lowest in the world: 3.5 per1,000 live births compared with 6.5 in the United States (Population ReferenceBureau, 2014).Canada: National Health InsuranceLike the United States, Canada is a financially successful democracy made up ofvarious provinces and territories more or less equivalent to US states. Althoughits GNI per capita of $42,600 is about one-quarter lower than in the UnitedStates, its economy is strong. In addition, because of steady immigration,Canada’s population is younger on average than populations in the majority ofmore developed nations, which increases the likelihood of having a relativelyhealthy population.Canada is also, however, a huge country, with vast social differences reflect-ing its vast geographic spaces. Its population is highly concentrated along itssouthern border, as are most health care personnel and facilities. Neither healthstatus nor health care access is as good in rural areas or in its remote northernregions, where many of the residents are poor Native Americans (known inCanada as“First Nations”).Structure of the Health Care SystemThe backbone of the Canadian healthcare system is the Canada Health Act of 1984, which stipulates that health caremust be universal, must cover all medically necessary services, must be portablefrom province to province, must be publically administered on a nonprofit basis,and must be accessible to all regardless of ability to pay. The system is builtaround public insurance paid for primarily by each Canadian province, withassistance from the federal government (Duncan, Morris, and McCarey, 2009;Commonwealth Fund, 2013). For this reason, the Canadian system is referredto asnational health insurance, or (as the previous chapter noted) asingle-payer system. In fact, however, the Canadian system is a decentralized one" "with each province retaining some autonomy and offering a somewhat differenthealth care system. Underpinning the system are payments that the federal gov-ernment gives the provinces yearly to run their health care systems. To receivethese payments, provinces must offer comprehensive medical coverage to all resi-dents through a public, nonprofit agency. Although the details of coverage varyacross provinces, each province must charge residents only minimal fees and mustallow residents to move to another province without losing their coverage.Purchasing CareThrough a combination of federal and provincial taxes, thepublic health insurance systems cover 70 percent of all health care costs, includ-ing most costs for hospital and medical care and some costs for prescriptiondrugs, dental care, long-term care, and mental health services (Duncan et al.,2009). Because the system is based primarily on graduated income taxes, it isfinancially progressive: Wealthier persons pay a higher proportion of theirincome in taxes and therefore pay more toward health care than do others.The remaining 30 percent of health costs are divided about equally betweenprivate insurers and private individuals paying out of pocket. Private insurancetakes two forms. Most commonly, Canadians purchase private insurance tocover services not included in the national health insurance system. In addition,some provinces now allow residents to purchase private insurance that coversservices thatareincluded in the national health system. Such insurance enablesindividuals to buy these services immediately rather than having to wait theirturn in the national health insurance system.Paying Doctors and HospitalsHospital doctors in Canada are paid on salary.Most non-hospital doctors work in private practices and are paid on a fee-for-service basis by the government insurance systems. Doctors submit theirbills directly to the health insurance system using fee schedules negotiated annu-ally between the provincial medical associations and provincial governments.Unlike in the United States, in Canada, doctors who consider these fees toolow can’tbalance bill(or“extra bill,”as it is known in Canada): billing patientsfor the difference between what the patients’insurance will pay and what thedoctor wants to charge. In addition, some provinces control costs by settingannual caps on the total amounts they will reimburse doctors. In practice, thismeans reimbursing doctors less for each service rendered as the total number ofservices rises.Canadian hospitals (almost all of which are nonprofit) annually receive anoperating budget and a capital expenditure budget from their provincial insur-ance system. Hospitals can spend their budgets as they like as long as they pro-vide care to anyone in their region who needs services.Access to CareCanadians average eight doctor visits per person per year com-pared with four visits for US citizens (OECD, 2014). Waiting times for tech-nologically complex care have been a problem in Canada, although rarely inlife-threatening circumstances. However, recent data suggest considerableimprovement (Canadian Institute for Health Information, 2010;" "2009). Most importantly, Canadians are far less likely than US residents to gowithout needed health care for financial reasons or to risk bankruptcy if theydo seek health care. Moreover, although Canadians are less likely to receive cer-tain high-technology procedures, such as coronary artery bypass surgery, this mayreflectoverusein the United States rather thanunderusein Canada. For example,one large study found that after heart attacks, Americans were five times morelikely than Canadians to receive coronary angiography and almost eight timesmore likely to receive coronary bypass surgery, but one-year survival rates forthe two groups were identical (Tu et al., 1997).Controlling the Costs of CareCosts of health care have risen rapidly inCanada, primarily because of population growth and increased prices for drugsand advanced technologies. Nevertheless, costs are far lower than in the UnitedStates (OECD, 2014). The United States currently spends 17 percent of its grossdomestic product (GDP) on health care, whereas Canada spends 11 percent.How does the Canadian system restrain health care costs? Most important, asingle-payer system dramatically reduces administrative overhead (Himmelsteinet al., 2014). In a single-payer, nonprofit system, no one need spend money sell-ing or advertising insurance, paying profits to stockholders, sending bills to mul-tiple insurers and individuals, or tracking down those who don’t pay their bills.Nor is money spent collecting funds to run the system because those funds arealready collected from the public through existing taxation systems.The single-payer system also saves money by centralizing purchasing power.As the sole purchasers of drugs in Canada, the provinces have substantial leverageto negotiate with pharmaceutical companies regarding drug prices. Similarly, asthe sole payer of doctors’bills, the provinces have considerable bargaining powerwhen negotiating with doctors over how much to reimburse doctors per service.Finally, as the sole payer of hospital budgets, the government can implementefficient regional planning and avoid unnecessary duplication of expensive facili-ties and services.Nevertheless, costs have risen substantially. Paying doctors on a fee-for-service basis makes it more difficult for Canada to control medical costs.When, for example, the provinces banned balance billing, doctors responded byincreasing the number of services they performed (with the provinces respondingby reducing the amount they reimbursed for each service). Finally, Canadian hos-pitals, like US hospitals, have reduced their costs by shifting toward outpatientservices and shorter patient stays, thus moving some costs from the health caresystem to family caregivers.Health OutcomesDespite continuing problems in access to health care, out-comes compare very favorably with those in the United States. Infant mortalityin Canada is 5.1 per 1,000 births compared with 6.4 in the United States, andaverage life expectancy is three years longer in Canada. Of course, these healthoutcomes tell us more about social conditions than about the quality of healthcare. Nevertheless, these data suggest that the Canadian health care system,although certainly not perfect, is superior to the US system." "Great Britain: National Health ServiceAs the home of the Industrial Revolution, Britain for many decades was a lead-ing industrial power. Along with its industrial strength came a strong labormovement as workers united to gain political power within Britain’s parliamen-tary government. As a result, a commitment to protecting its citizens, including acommitment to universal health care coverage, has long been central to Britain’sidentity. Beginning in the 1980s, however, the nation’s economy declined whilehealth care costs rose. To restrain those costs, subsequent governments instituteda series of reforms designed to introduce market principles into the health caresystem while retaining universal health coverage (Lopes, Coppola, and Riste,2009). Currently, GNI per capita in Britain is $35,800, about one-quarterlower than in the United States.Structure of the Health Care SystemAccording to the esteemed Common-wealth Fund, Great Britain has the world’s top health care system (Davis et al.,2014). Whereas Canada provides its citizens with national healthinsurance, GreatBritain since 1948 has provided care through itsNational Health Service(NHS)(Commonwealth Fund, 2013). In Canada, the government providesinsurance so individuals can purchase health care from private practitioners. InGreat Britain, on the other hand, the government directly pays virtually allhealth care costs. As a result, the two systems look quite similar to health careconsumers but differ substantially from the perspective of hospitals, health careworkers, and the government. This section focuses on the structure of theNHS in England, one of the three countries that (along with Scotland andWales) comprise Great Britain.Purchasing CareUnlike US citizens, most English citizens rarely see a medicalbill, an insurance form, or any other paperwork related to their health care. TheNHS uses tax revenues to pay virtually all costs for a wide range of health careservices, including medical care, visiting nurses for the homebound, homemakersfor chronically ill persons, and some aspects of long-term care.The NHS receives its funds almost solely through general taxation, withsmall supplements from employers and employees. As in Canada, because thehealth care system is paid for through graduated income taxes, it is financiallyprogressive.Paying Doctors and HospitalsAs in Germany, almost all medical specialistswork as salaried employees of the NHS at hospitals or other health care facilities,although they can earn extra income by seeing private patients. In contrast, mostEnglish general practitioners work as private contractors, increasingly in largegroup practices. General practitioners are paid by capitation.Capitationrefersto a system in which doctors are paid a set fee per year for each patient in theirpractice, regardless of how many times they see their patients or what services thedoctors provide. In such a system, doctors lose income when they provide moreservices. In addition, general practitioners receive financial supplements if they" "have low-income or elderly patients; practice in medically underserved areas; ormeet government targets for preventive services, such as immunizing more thana certain percentage of children in their practices.The vast majority of hospitals in England belong to the government(although some now include beds for private patients). The hospitals operatesemi-autonomously, but regional NHS officials and hospital administratorswork together to ensure that each hospital can offer quality care to patients.Access to CareUnder the NHS, individual financial difficulties no longer keepEnglish citizens from receiving necessary medical care. Waits can be uncomfort-ably long for nonemergency care, but any case delayed more than 18 weeks isreported to national authorities for further action. In addition, the NHS hasreduced substantially the geographic inequities that for generations made medicalcare inaccessible to many rural dwellers, although access to care remains a prob-lem in poor, inner-city neighborhoods. Britons average five doctor visits per per-son per year compared with four visits for US citizens (OECD, 2014). Access tohigh-technology care and expensive new drugs, however, remains lower than inthe United States. That said, in the United States access to treatments is limitedonly by the ability to pay, whereas in England a national panel of medical expertsdecide which services should be offered to citizens, based on their effectiveness,and then sets the prices for those services. Those prices are considerably lowerthan average prices in the United States and must be honored by drug manufac-turers, private practice doctors, and anyone working under NHS auspices. Forexample, until it was taken off the market in 2011, many US health insurers(includingMedicare) paid up to $100,000 per patient per year for the anti-cancer drug Avastin, even though strong evidence suggested it was ineffective(Kolata and Pollack, 2008). In contrast, the NHS decided against covering itfrom the start, arguing that NHS money would be better spent on less expensivedrugs with better track records. In sum, both the US and UK systems limit accessto care, but in very different ways with very different consequences.Controlling the Costs of CareGreat Britain spends about 9 percent of its GDPon health care, almost half the percentage spent by the United States (OECD,2014). Like Canada, Britain has made its health funds go further than they other-wise would through national and regional planning and by keeping salaries rela-tively low. Because the government owns a large proportion of health carefacilities and employs a large proportion of health care personnel, it can base deci-sions about developing, expanding, and locating high-technology facilities on arational assessment of how best to use available resources and can avoid the unnec-essary proliferation of expensive facilities. Similarly, because it is such a large buyer,the NHS can negotiate drug prices effectively with pharmaceutical firms.In addition, England has attempted to restrain government health careexpenditures by promoting privatization: Private companies can now run pri-mary care practices funded by the NHS; private hospitals can compete forNHS contracts against public hospitals; and NHS hospitals can now offer a vari-ety of services on a cash basis. In addition, officially commissioned groups of" "have low-income or elderly patients; practice in medically underserved areas; ormeet government targets for preventive services, such as immunizing more thana certain percentage of children in their practices.The vast majority of hospitals in England belong to the government(although some now include beds for private patients). The hospitals operatesemi-autonomously, but regional NHS officials and hospital administratorswork together to ensure that each hospital can offer quality care to patients.Access to CareUnder the NHS, individual financial difficulties no longer keepEnglish citizens from receiving necessary medical care. Waits can be uncomfort-ably long for nonemergency care, but any case delayed more than 18 weeks isreported to national authorities for further action. In addition, the NHS hasreduced substantially the geographic inequities that for generations made medicalcare inaccessible to many rural dwellers, although access to care remains a prob-lem in poor, inner-city neighborhoods. Britons average five doctor visits per per-son per year compared with four visits for US citizens (OECD, 2014). Access tohigh-technology care and expensive new drugs, however, remains lower than inthe United States. That said, in the United States access to treatments is limitedonly by the ability to pay, whereas in England a national panel of medical expertsdecide which services should be offered to citizens, based on their effectiveness,and then sets the prices for those services. Those prices are considerably lowerthan average prices in the United States and must be honored by drug manufac-turers, private practice doctors, and anyone working under NHS auspices. Forexample, until it was taken off the market in 2011, many US health insurers(includingMedicare) paid up to $100,000 per patient per year for the anti-cancer drug Avastin, even though strong evidence suggested it was ineffective(Kolata and Pollack, 2008). In contrast, the NHS decided against covering itfrom the start, arguing that NHS money would be better spent on less expensivedrugs with better track records. In sum, both the US and UK systems limit accessto care, but in very different ways with very different consequences.Controlling the Costs of CareGreat Britain spends about 9 percent of its GDPon health care, almost half the percentage spent by the United States (OECD,2014). Like Canada, Britain has made its health funds go further than they other-wise would through national and regional planning and by keeping salaries rela-tively low. Because the government owns a large proportion of health carefacilities and employs a large proportion of health care personnel, it can base deci-sions about developing, expanding, and locating high-technology facilities on arational assessment of how best to use available resources and can avoid the unnec-essary proliferation of expensive facilities. Similarly, because it is such a large buyer,the NHS can negotiate drug prices effectively with pharmaceutical firms.In addition, England has attempted to restrain government health careexpenditures by promoting privatization: Private companies can now run pri-mary care practices funded by the NHS; private hospitals can compete forNHS contracts against public hospitals; and NHS hospitals can now offer a vari-ety of services on a cash basis. In addition, officially commissioned groups of" "importance of eradicating syphilis and attempting to reduce the stigma of seekingtreatment for syphilis by defining the disease as a product of the corrupt formerregime rather than a matter of individual guilt. Those identified as likely to havesyphilis were tested and treated if needed. These methods—coupled with testing,among others, persons applying for marriage licenses, newly drafted soldiers, andentire populations in areas where syphilis was especially common—dramaticallyreduced theprevalenceof syphilis in China.Physician ExtendersThe second innovative strategy for which China has wonacclaim is its use of physician extenders in addition to medical doctors trainedin Western and (rarely) traditional medicine. In urban areas,street doctorsoffer both primary care and basic emergency care, as well as health education,immunization, and assistance with birth control. Street doctors have little formaltraining and work in outpatient clinics under doctors’supervision.In rural areas,village doctorsplayed a similar role. Novice village doctorswere selected for health care training by their fellow workers based on their apti-tude for health work, personal qualities, and political“purity.”After about threemonths of training (supplemented yearly by continuing education), village doc-tors returned to their rural communes, where they divided their time betweenagricultural labor and health care. Beginning in the late 1970s, however, villagedoctors were largely replaced byassistant doctors, who receive three years ofpostsecondary training in Western and traditional Chinese medicine and whocan provide both primary care and minor surgery. Unfortunately, there are fartoo few assistant doctors, and so rural areas remain seriously underserved.Purchasing CareAs China’s economy has changed from a largely socializedand centrally controlled system toward a more decentralized, economically het-erogeneous model, so has its health care system (Chen, 2001; Wang et al., 2007).For the majority of urban residents, these shifts have brought few changes. As inthe past, the government pays most costs of health insurance and health care forgovernment employees, military personnel, and students. Public industries andurban industrial collectives also pay for care for their workers. The growing andnow significant numbers of urban residents who work in private enterprises,however, often lack any health insurance.For rural Chinese—about 60 percent of China’s population—recent yearshave brought dramatically reduced access to health care (Wang et al., 2007).Before the 1980s, rural residents received their care at little or no cost throughthe agricultural communes where they lived and worked. Within these commu-nes, members shared all profits and costs, including those for health care. Eachcommune had between 15,000 and 50,000 members, several village doctors, anda clinic staffed by assistant doctors.Beginning in the early 1980s, most agricultural communes reverted to theiroriginal noncommunal village structures, with each family given land to farm bythe village. Families now keep their profits but are responsible for their own wel-fare if costs exceed profits. Because of this shift in financing, the former commu-nes no longer earn sufficient revenues to continue providing health care. Many" "village doctors returned to full-time agricultural work, and most assistant doctorsmoved to township or city clinics. Almost all rural residents now receive theirprimary health care on a fee-for-service basis, and financial difficulties haveforced some to cut back on needed care. In addition, waning government sup-port for large-scale public health activities has allowed previously conquered dis-eases to reemerge. For example, schistosomiasis, a debilitating and sometimesdeadly disease once eradicated by mass campaigns that killed the snails thatcarry it, is again endemic in some rural areas (Yardley, 2005).Paying Doctors and HospitalsCurrently, non-hospital doctors in Chinawork primarily on a fee-for-service basis, and hospital doctors work on salary.In addition, many townships (made up of six or more rural villages) have a clinicwhere doctors work on salary but are allowed to divide among themselves anyprofits that the clinic generates. As a result, doctors have an incentive to orderunnecessary tests and procedures (Wang et al., 2007).Unlike most medical care, hospital care has remained largely a public enter-prise. Almost all hospitals receive their operating and capital budgets from federalor local governments. In recent years, however, budgets have been cut and greatpressure has been placed on hospitals to generate income through selling drugsand services and by starting other enterprises. As a result, hospital patients runconsiderable risk of receiving unnecessary (and potentially dangerous) drugs, sur-geries, and other treatments (LaFraniere, 2010).Access to CareBecause of the changes in China’s health care system, prices forhealth care have risen and access has diminished, especially in rural areas, wherefewer hospital beds and doctors are available per capita. Although primary careremains affordable, even for those who lack health insurance, there are very fewprimary care doctors per person. As a result, people often turn to hospitals—whichcan be prohibitively expensive—even for very basic care (LaFraniere, 2010).To equalize access to care, the government has established a national fund tosupplement the health care budgets of poorer regions and an insurance programfor childhood immunizations. Those who, for a small premium, purchase thisinsurance receive free immunization for children up to age seven and freetreatment if a child develops one of the infectious diseases the immunizationprogram is supposed to prevent. More than half of all children in the countrybelong to this program. Finally, a similar insurance program offers prenatal andpostnatal care to women and infants; it is not known how many are covered bythis program.Health OutcomesAlthough China’s economy is developing rapidly, it stillspends only about 5.2 percent of its GDP (about $400 per person) on healthcare, considerably less than that spent in the more developed nations (OECD,2014). Nevertheless, China’s commitment to equalizing both income and healthcare has allowed it to attain health outcomes far greater than its economic statusor investment in health care might predict. Although median income in Chinaremains similar to that in many otherless developed nations, China boasts" "health outcomes only slightly below those of the more developed nations.Whereas in 1960 infant mortality was 150 deaths per 1,000 and life expectancywas 47 years, currently infant mortality is 21 per 1,000 and life expectancy is 74,only four years lower than in the United States (Population Reference Bureau,2014). Although large and increasing differences in health status remain betweenrural and urban dwellers, China now stands on the cusp of theepidemiologicaltransition, with chronic and degenerative diseases increasingly outpacing infec-tious diseases as the leading causes of death.Nevertheless, some regions of China continue to face health problems thathave long characterized the less developed nations, such as insufficient access toclean drinking water. The rise of a market economy has contributed to theseproblems as pressure to develop profitable industries has increased water and airpollution and decreased occupational safety, especially in rural areas (Chen,2001). Similarly, pressures on the health care system to control costs and generateprofits has led to a decreased emphasis on preventive care and increased emphasison profit-generating treatments and diagnostic procedures.Despite these problems, however, China does offer some lessons in how toimprove health in the less developed nations. As Chapter 4 described, three fac-tors seem to explain how China (like Sri Lanka, Costa Rica, Vietnam, and Cuba)achieved excellent health outcomes at low cost (Caldwell, 1993; Riley, 2007).Not surprisingly, health outcomes improved when access to medical careimproved. But improved health outcomes depended even more on emphasizingfamily planning; raising education levels among men; and, especially, raising edu-cation levels among women. Once women’s educational levels increased, theirpower in the family increased, giving them greater control over family planning.Women’s lives thus were less often cut short by childbirth, and their babies wereborn healthier. In addition, as women’s status rose, they and the children whodepended on them more often received a fair share of the family’s food, thusreducing malnutrition and increasing life expectancies.Mexico: Moving toward Equitable Health CareUnderstanding Mexico’s health care system is particularly important for US citi-zens because Mexico shares a long and permeable border with the United States.People routinely travel across the border in both directions for work or pleasure,bringing their diseases with them. In addition, both MexicansandUS citizenssometimes cross the border to the other country to seek health care, althoughMexicans more often travel north to seek medical care for life-threatening healthconditions, and US citizens more often travel south to seek inexpensive cosmeticsurgery, dental work, or medical drugs.Mexico has only recently entered the ranks of the more developed nations andstill has much in common with thelessdeveloped nations. As Mexican industry hasdeveloped, many have moved off the land, and now more than three-quarters ofMexico’s population live in cities. Those cities contain both middle-class neigh-borhoods that enjoy health and living conditions similar to those found in themore developed nations and impoverished slums that lack such basic facilities as" "running water and sewer systems. These slums are inhabited primarily by migrantsfrom rural areas. Rural areas, especially those inhabited primarily by Indians,generally are poor, and about 40 percent lack sewer systems (Pan American HealthOrganization, 2012). GNI per capita remains only $16,100—considerably higherthan in China but far lower than in the United States or in the European nationsdiscussed in this chapter (Population Reference Bureau, 2014).Structure of the Health Care SystemUnlike any of the other countriesdescribed in this chapter, Mexico has a three-part system for health care: (1) pri-vate health care and health insurance for the wealthiest, (2) a government-provided insurance program for salaried workers (Social Security), and (3) aseparate government-provided insurance program for everyone else (SeguroPopular) (Frenk et al., 2006). This three-tiered system is a product of Mexico’sunique history, in which revolutionary fervor and conservative sentiments havealways counterbalanced each other and in which the social and economic divisionbetween Indians (who now make up less than 10 percent of the population) andothers (who are primarily a mix of Spanish and Indian) has remained important.Over the centuries, Mexico has experienced several revolutions—some vio-lent and some at the ballot box. Throughout the twentieth century, these revo-lutions resulted in gradual improvements in the health care available to Mexico’scitizens. In 1917, Mexico’s new constitution first gave the federal governmentresponsibility for health care. The government soon began providing funds forrural clinics staffed by health aides and, by the 1930s, began requiring all newphysicians to work for a year in a rural community.The next major change in the health care system occurred in 1942, whenthe government established the Social Security program and opened a networkof modern health clinics and hospitals around the country for Social Securitymembers. However, that program covers only salaried workers—about half thepopulation—leaving many others with no access to health care or with crushingdebts if they seek such care. Consequently, in 2003, Mexico passed a law aimedat reforming this system (Knaul et al., 2012). Under the 2003 law, all Mexicansnot eligible for Social Security can instead obtain membership in anothergovernment-run health insurance program, known as Seguro Popular (PublicInsurance). Membership is free for the poorest 20 percent of Mexicans and avail-able on a sliding scale to all others. Less than a decade later, more than 50 millionpeople had enrolled in the program, giving Mexico essentially universal healthinsurance coverage (Knaul et al., 2012).Nevertheless, inequities remain within the system (Knaul et al., 2012). SocialSecurity provides a more comprehensive package of health benefits than doesSeguro Popular, and urbanized and wealthier regions continue to have more andbetter health care providers and facilities than do rural and poorer regions underboth Social Security and Seguro Popular. Although these inequities are diminish-ing, the system as a whole remains underfunded, so problems are likely to continue.Purchasing CareMexicans typically pay only small copayments or other feesfor their health care. Fees are waived for the poorest Mexicans."

"Health OutcomesAlthough Mexico remains rife with social and economic in-equities and resulting inequities in health, it has nevertheless achieved notable im-provements in health outcomes for much of its population. Consequently, by somemeasures, Mexico appears to have completed the epidemiological transition—cancer and heart disease now kill more Mexicans than do infectious diseases, andlife expectancy is 76, only two years less than in the United States (PopulationReference Bureau, 2014). Infant mortality, child mortality, and maternal mortalityall decreased substantially between 2000 and 2010 (Knaul et al., 2012).These health outcomes have been achieved at relatively little cost. Mexicospends less than $1,000 per person on health care—about 6 percent of its GDP,compared to 16 percent in the United States (OECD, 2014).Democratic Republic of Congo: When Health Care CollapsesCurrent conditions in the DRC are the result of more than a century of corruptand unstable governments. During the 1880s, King Leopold II of Belgiumgained control over what was then known as the Congo Free State, holding itas his private property. Although Belgian administrators helped to develop basicinfrastructure such as roads and hospitals, they also exploited natural resources forBelgium’s benefit, used brutal force when it suited their purposes, kept virtuallyall power in Belgian hands, and flamed ethnic conflict among different Congo-lese ethnic groups to keep them from uniting against Belgian control.Belgium relinquished control over the DRC in 1960. Since then, the coun-try has been governed primarily by a series of corrupt, ruthless dictators (oftenfunded by the United States for its own purposes). To make matters worse,beginning in 1998, the country was torn by a ferocious civil war that was fueledby inter-ethnic conflict and competition over valuable minerals. The numbers ofdead from that war approach those from World War II, and the widespread useof mass rape as a weapon stunned the world.Although the civil war officially ended in 2003, the violence continues, andthe central government’s control over the military, paramilitary groups, and thepublic remains fragile. Moreover, years of warfare led to environmental destruc-tion, the abandonment or destruction of agricultural lands, and large-scale move-ment of citizens away from rural war zones into substandard, temporary housing incities. All these factors have fed malnutrition and disease, including preventableoutbreaks of cholera; measles; malaria; and, most ominously, Ebola virus disease(Doctors Without Borders, 2014). The DRC remains one of the world’s poorestnations, with a GNI per capita of only $680 (Population Reference Bureau, 2014).Structure of the Health Care SystemOn paper, the health care system in theDRC consists of a network of hospitals, primary care clinics, and public healthworkers distributed around the country’s numerous health districts (Inungu,2010). These days, however, it is difficult to even talk about a health care systemin the DRC. During the civil war, many doctors fled rural areas or fled thenation altogether, many hospitals were damaged or destroyed, and man" "pharmacists lost access to basic medications. Although conditions have improvedsince then in urban areas (primarily because of disease-specific health programssponsored by the World Bank, World Health Organization, and other interna-tional nonprofit organizations), the situation remains dire. In areas where conflictcontinues, health care personnel have been harassed or threatened, and manyclinics have been abandoned (Doctors Without Borders, 2014).Purchasing CareAlthough treatment in state-run clinics and hospitals is sup-posed to be offered at low prices, in reality, patients and their families are oftenexpected to pay for everything, including medicines, bandages, and other supplies.Moreover, even the lowest of fees are too high for many Congolese to pay. Othersmay decide against going to a doctor because they know they can’t afford any med-icines that the doctor might prescribe (Doctors Without Borders, 2014).Because of both cultural traditions and a lack of access to Western medicine,many Congolese rely on homemade herbal remedies or seek care from tradi-tional midwives or traditional healers calledngangas(Inungu, 2010).Ngangasarebelieved able to determine whether an illness was caused by natural or supernat-ural forces and to prescribe appropriate treatments, such as wearing a talisman toward off evil or drinking an herbal potion. Some of the treatments used by tra-ditional practitioners undoubtedly help (if only through aplaceboeffect), butothers undoubtedly harm.Paying Doctors and HospitalsIn theory, doctors and hospitals receive regularsalaries and budgets from the federal government. In practice, many doctors havebeen paid little or nothing for years, so they support themselves by charging feesto patients and their families (Michon, 2008). Most hospitals now receive most oftheir funding from international nonprofit organizations and donations from themore developed nations.Access to CareAs this discussion suggests, most citizens of the DRC—especially in rural areas—have extremely limited access to modern medical care.Many of the rest rely on temporary facilities staffed by international aid workers.Meanwhile, the wealthiest Congolese can travel to South Africa or elsewherewhenever they need care (Inungu, 2010).Health OutcomesBy all measures, health outcomes in the DRC are abysmal.Average life expectancy is only 48 years, far below that in most nations aroundthe world. Similarly, 114 of every 1,000 babies die in infancy—18 timeshigherthan in the United States (Population Reference Bureau, 2014).IMPLICATIONSA critical approach to health care reform suggests that for true structural changesto occur in the US health care system, we must be willing to challenge thepower dynamics underlying the current system—something that did not happen"