In: Operations Management
10. We have now looked at three different health care systems. Compare and contrast the American System with the Bismarck and Beveridge Systems. What are the strengths and weaknesses of each in your mind?
Bismarck Model of healthcare.
Bismarck model was named after Prussian chancellor Otto von Bismarck who created this system as welfare system where government was believed to be responsible for providing healthcare facilities to the common public. Here the expense is indirectly borne by employee and employer in conjunction. Insurance is provided to everybody and obviously insurance companies are non profit based out of law. Even though hospitals and healthcare are directly provided by private entities the control is always with government and hence the costs are quite reasonable.
In most scenarios it generally costs more than the Beveridge model but the level of prudence is more and actions are nimble/agile due to less direct government interference.
Advantages
· There is no particular risk for residents of being uncovered/ uninsured during the time of need, when expensive healthcare bills are faced by them
· Administrative costs are quite low compared to United States due to unique public private partnership
· Primary healthcare is readily accessible for all and the waiting time for the same is very less
Disadvantages
· As the there is a core focus on driving efficiency and optimizing the costs obviously the locations are centralized and hence rural population may face problem accessing the healthcare with ease.
· The individual healthcare costs are basically covered from individuals and partly by public but end of the day employment and personal taxes gets inflated for this reason
· Even though primary healthcare service is widespread and can be obtained with ease by most of the population it gets really difficult to get secondary and tertiary services. This is because the providers are less and demand is quite high
Beveridge Model
This model is completely financed by the government much like the public libraries and police forces, armed forces are totally financed by the government. The complete expenses are paid through citizen’s tax inflow so they don’t have to pay medical expenses directly .It doesn’t discriminate on economic ability and tries to dish out best possible healthcare services. Hospitals and the manpower running them are considered to be government property /employees and hence they receive their paychecks from governments rather than directly from the citizens.
The majority of hospitals and their staff are considered government property and employees, respectively. Private Doctors and clinics also receive their fees from the government instead of from the citizens. According to Physicians for a National Health Program (PNHP), this health care system has low costs per capita because the national government determines what doctors can do and what they can charge for their services..
Advantages
· As it doesn’t discriminate based on economic ability all the citizens have access to equitable healthcare services. Widespread access regardless of affordability is a big positive point for this system
· Cost of the system is heavily regulated due to total government dependence or monitoring. Hence there is no chance of incentivized service rendered to patients.
· Citizens only have to pay their taxes which in turn take care of the medical bills. There is no co-pay or medical bills that they have to attain
Disadvantages
· As the source of government spending for healthcare expenditure is personal taxes it astronomically impacts the personal taxes making it quite high for normal residents.
· As the regulations are very stringent the service lacks agility. Complex procedures are not easy to access for individuals
Now let us come to Healthcare model of United States where in a unique model having elements of almost all four basic models are in force.Previously in states healthcare services were scarce due to very less number of doctors and trained staffs but after the US civil war the federal government and state government has created many healthcare institutions to take care of wounded soldiers. This step picked up the pace and United States healthcare system evolved rapidly
The current Healthcare was as a result of Patient Protection and Affordable Care Act in 2010. This basically tries to address issues brought by private, for-profit insurance companies. These insurance companies left many uninsured due to lack of affordability or preexisting conditions.
Advantages
Equality
Equitable treatment for all life irrespective of rich and poor is of great value in united states healthcare .Universal healthcare system in states helps the poor section of the society get the much needed medical assistance whenever they need it.
Greater public health
It has a holistic approach to curb infectious diseases to stop spread of pandemics and proper vaccinations prevent most of the outbreak at early stage. Hence this system promotes improved public health and stable economy
Efficiency
The process is very standardized and well thought out where redundant activities like are eliminated and doctors can focus on serving the patients in need rather than worrying about their insurance coverage and affordability of treatment. All citizens are covered under universal health cover
Adequate Medical fund
It gives much needed buffer and coverage for all hence saving the system form a medical bankruptcy.
Disadvantages
Tax abuse
The government has to monitor the taxes very rigidly which earns a bad name for itself. The total controlled movement of goods gives the United States a look socialist structure.
Bandwidth chokes of healthcare system
As the system is easy to access there is tendency to make use of it without any critical emergency or need. These conditions which doesn’t even need for a medical attention can choke the bandwidth of the healthcare system easily
Lack of motivation
As the whole system is not incentivized there might be shortage of doctors in the near future
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