Global typologies of Healthcare Systems

• There are four types of healthcare systems that are the most
common to developed countries; three types of healthcare systems
are single-payer. The US is unique in that what system you are a
part of depends upon your age and your income and overall good
fortune.
1) The Beveridge Model
2) The Bismarck Model
3) The National Health Insurance Model
4) The Out-of-Pocket Model
 Global typologies of Healthcare Systems
1. The Beveridge Model
 Named after William Beveridge, the daring social reformer who designed Britain’s
National Health Service. In this system, health care is provided and financed by the
government through tax payments, just like the police force or the public library.
 Many, but not all, hospitals and clinics are owned by the government; some doctors
are government employees, but there are also private doctors who collect their fees
from the government. These systems tend to have low costs per capital, because the
government, as the sole payer, controls what doctors can do and what they can charge.
 Those who live in a nation with this type of system never see a doctor's bill, as all
health care is paid through the government through taxes. And, because the
government controls what pharmaceutical companies and doctors can charge, this
system saves an enormous sum of money. While opponents of single payer care claim
this causes longer wait times due to a lack of physicians, the data does not substantiate
this. England, for example, uses this model, and their quality of care is not
compromised, and most hospital waits are still less than four hours long.
 Global typologies of Healthcare Systems
2. The Bismarck Model
 Named for the Prussian Chancellor Otto von Bismarck, who invented the welfare
state as part of the unification of Germany in the 19th century. Despite its European
heritage, this system of providing health care would look fairly familiar to
Americans. It uses an insurance system — the insurers are called “sickness funds”
— usually financed jointly by employers and employees through payroll deduction.
 Unlike the U.S. insurance industry, though, Bismarck-type health insurance plans
have to cover everybody, and they don’t make a profit. Doctors and hospitals tend
to be private in Bismarck countries; Japan has more private hospitals than
the U.S. In addition, hospitals and doctors may not operate for profit, so overall
costs are again much more affordable than they are under our current US model.
 Although this is a multi-payer model — Germany has about 240 different funds —
tight regulation gives government much of the cost-control clout that the single-
payer Beveridge Model provides.
 The Bismarck model is found in Germany, of course, and France, Belgium, the
Netherlands, Japan, Switzerland, and, to a degree, in Latin America.
 Global typologies of Healthcare Systems
3. The National Health Insurance Model
This system has elements of both Beveridge and Bismarck. It uses
private-sector providers, but payment comes from a government-run
insurance program that every citizen pays into. Since there’s no need for
marketing, no financial motive to deny claims and no profit, these
universal insurance programs tend to be cheaper and much simpler
administratively than American-style for-profit insurance.
The single payer tends to have considerable market power to negotiate
for lower prices; Canada’s system, for example, has negotiated such low
prices from pharmaceutical companies that Americans have spurned their
own drug stores to buy pills north of the border. National Health
Insurance plans also control costs by limiting the medical services they
will pay for, or by making patients wait to be treated.
The classic NHI system is found in Canada, but some newly
industrialized countries — Taiwan and South Korea, for example — have
also adopted the NHI model.
 Global typologies of Healthcare Systems
4. The Out-of-Pocket Model
 The final of the four types of healthcare systems is the one that the majority of US citizens
are covered by: the private insurance system. In this system, individuals are either covered by
their employers, covered by a private policy the policyholder purchases themselves or they
go without coverage at all.
 This is currently the health care system in the United States, and this combined with
shrinking wages, ever-increasing prices and more and more employers switching to a “gig”
model of work leaves millions of Americans with nowhere to go for care other than the
emergency room.
 In some areas of the United States, particularly poorer areas in the South, citizens may go
their entire lives without ever once seeing a doctor. People living in California’s San Joaquin
Valley consume some of the most contaminated drinking water nationwide, yet funding is
largely unavailable for those who need immediate care as a result.
Only the developed, industrialized countries — perhaps 40 of the world’s 200 countries —
have established health care systems. Most of the nations on the planet are too poor and too
disorganized to provide any kind of mass medical care. The basic rule in such countries is
that the rich get medical care; the poor stay sick or die.
In rural regions of Africa, India, China and South America, hundreds of millions of people
go their whole lives without ever seeing a doctor. They may have access, though, to a village
 Global typologies of Healthcare Systems

 Note - Reid’s “Beveridge” model corresponds to what PNHP would call a single
payer national health service (UK); “Bismark” model refers to countries
that PNHP would say use non-profit “sickness funds” or a “social insurance
model” (Germany); and “National health insurance” corresponds to single payer
national health insurance (Canada, Taiwan). Reid’s “out-of-pocket” model is
what PNHP would call “market driven” health care. Some countries have mixed
models (e.g. Sweden has some features of a national health service such as
hospitals run by county government; but other features of national health
insurance such as physicians being paid on a FFS basis). This explains why Reid
might classify the Scandinavian systems as “Beveridge” while PNHP classifies
them as “single payer national health insurance.”
 Ethiopian Healthcare Systems
 The government is the major provider of health services in Ethiopia. According to
the national welfare monitoring survey (CSA 2012b), two ‐thirds of all patients
have visited government facilities compared to 27 percent who visit private for-
profit and nongovernmental organization (NGO) providers. The main reason for
the choice of provider is access, as measured by closeness to the facility. Four out
of five visited the health facility because either it is closer to home or they have
no other choice of facility. The role of private health clinics and medical services
is growing in importance, particularly in urban areas. In addition, about 200 NGO
health clinics and eight NGO hospitals are operating throughout the country,
particularly in rural areas.
 The HSDP harmonization and alignment manual (FMOH 2007b), the compact
signed in 2008 between the Government of Ethiopia and most of the development
partners active in the health sector, and the joint financing arrangement, frame the
alignment and harmonization efforts toward the principles of “one plan, one
budget and one report,” the SWAp mechanism. Since 2008, a pooled fund—the
MDG performance fund—has been in place. In addition to other activities, the
MDG fund finances equipment, commodities, and supplies for the HEP, and the
capacity building of the HEWs through integrated refresher training.
 Ethiopian Healthcare Systems
 HSDP IV has introduced a three-tier health service system (FMOH 2010).

Figure 1: Ethiopian Health Tier System

 Ethiopian Healthcare Systems
1. The primary care level has three kinds of service points – health
posts, health centers and primary hospitals.
 Each Health Post (HP) is staffed with two HEWs, and is
responsible for a population of 3-5,000 persons. The HEWs are
expected to spend less than 20% of their time in health posts, and
more than 80% of their time is meant to be spent on community
outreach program visits to households, especially mothers and
children. The HEWs provide 96 hours of training to households on
the selected packages of HEP and follow the household’s practices
before certification and graduation of the household. HEWs also
provide selected health care services, including family planning,
EPI, OTP, clean delivery and essential newborn care services,
diagnosis and treatment of malaria, diagnose and treatment of
pneumonia, and management of diarrhea and dehydration using
ORS.
 Ethiopian Healthcare Systems
 Primary Hospital provides inpatient and ambulatory services to an average
population of 100,000. In addition to what a HC can provide, am primary hospital
provides emergency surgical services, including Caesarean Section and gives
access to blood transfusion service. It also serves as a referral centre for HCs
under its catchment areas, and is a practical training centre for nurses and other
paramedical health professionals. A primary hospital has an inpatient capacity of
25-50 beds. On average, a Primary Hospital has a staff of 53 persons.
2. The secondary care level is comprised of General Hospitals.
A General Hospital provides inpatient and ambulatory services to an average of
1,000,000 people. It is staffed by an average of 234 professionals. It serves as a
referral centre for primary hospitals. It has an inpatient capacity of XX beds and
serves as a training centre for health officers, nurses and emergency surgeons, as
well as other categories of health workers.
3. The tertiary care level is comprised of Specialized Hospitals.
A specialized hospital serves an average of five million people. It is staffed by an
average of 440 professionals. It serves as a referral general hospitals and has an
inpatient capacity of XX beds.
 Ethiopian Healthcare Systems
 The current Ethiopia health care financing strategy focus on financing of primary health care
services in a sustainable manner. It envisions reaching universal health coverage by 2035.
The prioritized initiatives are mobilizing adequate resources mainly from domestic sources,
reducing out-of-pocket spending at the point of service use, enhancing efficiency and
effectiveness, strengthening public private partnership and capacity development for
improved health care financing.
 A strategy on health Insurance was developed since 2008. To increase access to health care
and reduce household vulnerability to out of pocket(oop) health expenditure. Table 1 source
of health financing in Ethiopia

 As shown in the table above, this is the source of health financing that can be seen in
Ethiopia, which explains that the donors, households(oop) and Government have almost
equal expenditure. To minimize financial disasters, the government has developed an
affordable health insurance strategy. The strategy identified two types of Health insurance
Provided with essential health care regardless of their economic status and ability.
 Social Health Insurance(SHI) is a formal sector affordable only for rich people.
 Community-Based Health Insurance(CBHI) is for rural & urban informal sector.