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Single Payer Universal Health Insurance 10 24 09


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PNHP single payer overview

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Single Payer Universal Health Insurance 10 24 09

  1. 1. Single Payer Universal Health Insurance for the USA William C. Hsiao, Ph.D. FSA K.T. Li Professor of Economics Harvard School of Public Health PNHP 2009 Annual Meeting October 24, 2009 Cambridge, MA
  2. 2. Single Payer <ul><li>Definition: </li></ul><ul><li>Single risk pool </li></ul><ul><li>Single benefit package </li></ul><ul><li>Single payer of providers </li></ul><ul><li>Typically government runs it </li></ul>
  3. 3. Single-payer and Non-Single Payer-Advanced Nations Canada, UK, Taiwan, New Zealand, Germany, Japan USA Singapore Single Payer Non-Single Payer Australia
  4. 4. A Closer Examination of Single Payer <ul><li>Single payer is a means to ends. What are the ends? </li></ul><ul><ul><li>Risk-pooling: pool together health risks of all citizens </li></ul></ul><ul><ul><li>Equity in distribution of financing burden: uniform premium rate scaled by income </li></ul></ul><ul><ul><li>Equity in benefit: single benefits package </li></ul></ul><ul><ul><li>Manage health expenditure: single payer of providers </li></ul></ul><ul><ul><li>Manage quality of patient care and some patients’ abuse of services: uniform electronic record </li></ul></ul><ul><ul><li>Manage providers: uniform electronic records to create provider profile </li></ul></ul>
  5. 5. An Example: Taiwan <ul><li>Universal coverage, risk pooling, equity in finance: </li></ul><ul><ul><li>Mandate all employers and individuals </li></ul></ul><ul><ul><li>Employers pay 60%, employees 30%, gov’t 10% </li></ul></ul><ul><ul><li>Poor—100% premium subsidy; farmers, self- </li></ul></ul><ul><ul><li>employed and veterans--partial subsidy </li></ul></ul><ul><li>Equal access: uniform comprehensive benefit package, includes Chinese medicine, home care. </li></ul><ul><li>Providers: paid on fee-for-services basis with uniform fee schedule </li></ul><ul><li>Single payer—government (Bureau of NHI) </li></ul>
  6. 6. Taiwanses Single-Payer Organized <ul><li>Uniform administrative procedures for patients’ access (Smart Care) and claim payment  reduce paper work and administrative expenses </li></ul><ul><li>Uniform electronic patient records  improve the continuity and effectiveness of health care and reduce repetition of tests </li></ul><ul><li>Uniform claim records  Can produce complete profile of providers’ medical practice and billing; reduce fraud, over-charges, over-treatments and billing. </li></ul>
  7. 8. Advantages of Single-Payer (Bend the Curve) <ul><li>Reduce cost shifting </li></ul><ul><li>Reduce Administrative Expenses of: </li></ul><ul><ul><li>Insurance plans </li></ul></ul><ul><ul><li>Providers </li></ul></ul><ul><li>Reduce (or eliminate) risk selection and adverse selection </li></ul><ul><li>Manage health expenditure inflation rate </li></ul><ul><ul><li>Impose overall budget on health care expenditure </li></ul></ul><ul><ul><li>Technology diffusion </li></ul></ul><ul><ul><li>Resource allocation </li></ul></ul><ul><ul><li>Control aberrant patients and providers </li></ul></ul>
  8. 9. Behind The Bill: Who Pays What UCLA Medical Center (Los Angeles) Oregon Health and Science University (Portland) Jamaica Hospital (Queens, NY) Johns Hopkins Hospital (Baltimore) Grinnell Regional Medical Center (Grinnell, Iowa)
  9. 12. Disadvantages of Single-Payer (USA) Patients Fewer choice of insurance plans Physicians • Income • Monitor medical practice Hospitals Revenue Pharmaceutical and Medical Devise Companies Rate of diffusion for new products Profits Society: Technological Advancement ?
  10. 13. Technological Advancements <ul><li>In manufacturing and service sectors </li></ul><ul><ul><li>Improve efficiency about 1-2% annually </li></ul></ul><ul><li>In health sector </li></ul><ul><ul><li>Cost 2% more annually </li></ul></ul>
  11. 14. Political and Technical Feasibility of Single-Payer in the USA <ul><li>A Modified German model </li></ul><ul><ul><li>Several insurers in a state, each has to offer a standard benefit package </li></ul></ul><ul><ul><li>Uniform fee schedule </li></ul></ul><ul><ul><li>Uniform patient and claim electronic records </li></ul></ul><ul><ul><li>Integrated delivery system for selected chronic diseases </li></ul></ul><ul><li>Medicare model with contract to private insurers for administration at state level. </li></ul>
  12. 15. A Simple Fact: One Person’s Expense Is Another’s Income <ul><li>Expenditure (Price x Quantity) </li></ul><ul><li>= Providers’ Income </li></ul><ul><li>Premium payment = </li></ul><ul><li>Insurers’ income and profit </li></ul>
  13. 16. THANK YOU