The United States
It is desirable to learn lessons from abroad, but well noted that it would be impossible to simply transfer policies from one country to the other. There is no such thing as a perfect finance model. There are many calls to move towards contemporary American free insurance and service market system6. It is argued that if there is no competition, the consumer will continue to be poorly served and second-class treatment will remain. However, many responses listed out the sophisticated problems that have arisen from the American healthcare system.
Patient Choice One of the important justifications of the system in the US is greater patient choice. Under the concept of “money following the patient”, patients would not be constrained by cost considerations when choosing services between private sector providers and public sector providers6. Americans are free in the selection of doctors, standards of services as well as service providers. From the experience of the US, voluntary private insurance permits doctors to offer more expensive services beyond the basic provision. Patients are required to pay out-of-pocket for any extra charges. This kind of rigid payment system actually constrains rather than expands freedom of choice of patients6. Patient choice is expensive and thus is more likely to be restricted, especially when there is cost containment. It is the situation in the US that one of the main functions of HMOs was to introduce a gate-keeping role for GPs and limit the wide choices of specialists inherent in the traditional insurance mechanism11.
Efficiency With free choice and free market, people have the incentive for enjoying maximum services and claiming full benefits offered by the insurance scheme. It leads to a demand side moral hazard problem for over-consumption of services which causes market inefficiency12. Under the insurance market, hospitals are economic agents that aim at maximizing profits and it will create the supply side moral hazard for over-provision of services. Besides, many patients and providers in the US experience many problems with care co-ordination12. In order to prevent abuses and malpractice, mechanisms for checking and auditing would be necessary, which in turn leads to huge administration costs in the US system. Single-payer models in health insurance encourage cooperation and overcome the problem of inefficiency. The main advantage of single-payer system is that one can enjoy universal coverage at a lower cost than is attained by pluralistic funding approaches. It avoids adverse risk selection and ensures that no one is uninsurable
Equity The level of premiumand co-payment would have great impact to equity of the system. The costs of treating uninsured as free care must be absorbed by the insured via cost shifting, higher premiums or taxes39. If the level of payment becomes heavy burdens to lower income group, it creates disincentives for this group to use the system even they experience genuine needs. Due to this marginalization and exclusion, the premium contributed by the lower income group will indirectly subsidize the services consumed by the high income group. The injustice so created makes worse to the equity in access