User:Pdarveau/huso-topic-sm4
The economics of healthcare -- public v. private
[edit]Tags: healthcare, public/private divide, cost structures
The USA follows a private healthcare model, contrary to that of many other Western countries like Canada and the UK. The two systems are often juxtaposed: universal healthcare aims to provide coverage for all, while private is driven by market principle and individual insurance. They are closely linked to the economic state of affairs. Specifically, in the USA, having an income is essential in the insurance needed to afford healthcare, or pay for extraneous treatments.
Cost is one of the greatest factors between the public and private healthcare systems. The most important concept here is taxes -- in countries like Canada, taxes fund the centralized healthcare costs and the creation of public hospitals and clinics. In private models, costs are put on the consumer through insurance or out of pocket expenses. It is intrinsically related to the market-deriven principle of supply and demand -- if there is demand for a medicine of a medical service, it will increase.
Many people point to the unaffordability of healthcare in the states as a huge downfall to the private system. It is true that it is an inherently capitalist system, but the tradeoff, as stated by the World Population Review, is actually positive. The USA has some of the shortest wait times for general and specialist healthcare in the world, certainly compared to the UK and Canada.
The economic implications of this relates most to the national budgets of each country. Public healthcare requires substantial tax and public investment, which during economic downturns, can make a lack of access to healthcare even worse if the budget is not properly managed. Private healthcare shifts this cost to the individual consumer, which largely increases financial burdens on households. While private systems may reduce government healthcare spending, they can create efficiencies due to high out-of-pocket costs, which can reduce economic stability for families, and consumer spending in general if people know they must save for costs like healthcare.
Interestingly, though, is the way in which this impacts the economic workforce. While some say that having a healthcare safety net can increase the efficiency of a workplace, the counter might also be true as exhibited by the USA. If individuals know they must afford healthcare, they are more likely to work and take care of themselves to avoid going into hospitals. This tradeoff is, at the end of the day, based on individual consumer behaviors and attitudes derived from their ability to afford healthcare.