Comparison of Healthcare System of Australia, Canada, and Sweden

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This discussion presents a comparative analysis of the financial system of Australia and two other OECD member states namely Sweden and Canada. The financial results revealed that Sweden has the highest allocation, followed by Canada while Australia ranks last among the three OECD states. It was also discussed that Australia has a Medicare plan which promotes affordable healthcare for fundamental diagnosis and treatments across the nation. Accordingly, some challenges were highlighted and their possible recommendations also mentioned.

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Running Head: HEALTH FINANCIAL MANAGEMENT 1
Health Financial Management
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HEALTH FINANCIAL MANAGEMENT 2
Health Financial Management
Comparison of the Healthcare System of Australia, Canada, and Sweden
This discussion presents a comparative analysis of the financial system of Australia
and two other OECD member states namely Sweden and Canada. OECD is an
intergovernmental economic organization which brings together 36 nations with the main
objective of stimulating development and world trade. Among the founding principles is the
need for improving the quality and affordability of healthcare among its member countries
(Mossialos, Wenzl, Osborn & Sarnak, 2016). However, the current scenario does not reflect
equality of healthcare systems as postulated in the organization.
Notable similarities among these three healthcare systems are discussed below; To
start with, the financial structure of the Australian healthcare system is funded as follows;
government allocation, non-government organizations’ contributions, health insurance
corporations, and direct payments during treatment (Mossialos et al, 2016). Here, government
expenditure represents the largest share in funding healthcare systems, with a program called
Medicare. Similarly, the healthcare system of Sweden is largely government-funded, with
little contributions from the private health insurers (Karanikolos et al, 2016). The country
also receives funds from NGOs and individuals who pay for medical services. Canada relies
on the government-sponsored healthcare system, also known as Medicare (Karanikolos et al,
2016). The country has established a programme called universal healthcare which funds
fundamental health needs. In addition, the country has private health insurance which pays
for services that are partially or not covered by Medicare.
On the other hand, some slight differences in the financial structure of these
companies are discussed as follows; there is no standardized proportion of government
allocations for healthcare expenses among the three countries. For instance, the Australian
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HEALTH FINANCIAL MANAGEMENT 3
government provides 67% funding through Medicare while the remaining 33% is catered for
by private insurance companies (OECD, 2019). On the other hand, the Swedish government
pays for 97% of medical costs in the country, leaving only 3% for the private sector. Lastly,
the Canadian government provides up to 75% funding while the private sector caters for 25%
(OECD, 2019). In this category, Australia has the least healthcare funding system provided
by the government. As such, it might be one of the reasons why quality of health in Australia
is below Canada and Sweden.
Financial Analysis of the Healthcare Systems of Australia, Canada and Sweden
According to the information obtained from OECD, there are apparent differences
which can be noted in terms of funds allocation. Sweden is the highest spender on healthcare
systems with a total of USD 5,003 annually (OECD, 2019). The results also indicated that
Canada spends USD 4,506 while Australia allocates USD 4,177 on an annual basis.
Fig 1.0 showing top healthcare spending by OECD countries (OECD, 2019)
Considering that the quality of healthcare is directly proportional to the value of
funds allocated, then it implies that Sweden has the best medical services, followed by
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HEALTH FINANCIAL MANAGEMENT 4
Canada while Australia ranks last among the three nations. From these results, it can be
concluded that the Swedish government has a superior healthcare system as compared to
Australia and Canada. These funds are majorly derived from taxation and budget allocations
by the central government.
One major similarity among the three nations is that the highest proportion of
healthcare financing is raised by the government through taxation. For instance, the
Australian government allocates almost 10% of its budget to healthcare. These funds are
raised through a 2% Medicare levy paid by Australians except for low-income earners. For
high-income earners, there is an additional levy of 1.5% which is imposed for health
insurance (Carpenter, Islam, Yen & McRae, 2015). Accordingly, the Swedish government
raises 71% of its healthcare funds through local taxation. Here, the government authorizes
county councils to deduct a given percentage of income tax hence pooling resources for
supporting healthcare provision in the country (Molarius et al, 2014). Lastly, the Canadian
government also supports its healthcare operations through taxations and budget allocation of
11.5% of the country’s GDP. In Canada, the Central government is involved in regulating the
taxation rates charged in each province towards the Medicare program.
Performance Measures in Australia as Compared to Sweden and Canada
From the evaluations of the management of healthcare systems in these three
countries, the following performance measures can be discussed. Firstly, Australia’s
Medicare program is superior to the services offered by Swedish and Canadian systems
because it is a comprehensive package which pays for 100% practitioner fee, 85% specialist
fee, and 75% fee in private hospital (de Cos & Moral-Benito, 2014). In addition, the
Medicare provides other concessions and benefits to veterans, disabled persons, and the

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HEALTH FINANCIAL MANAGEMENT 5
indigenous population. Accordingly, the Medicare offers competitive packages with a health
expenditure to GDP ratio of 9.5%, a score above the OECD’s average value.
Australia’s Medicare is fairly matching with Canada’s Medicare and Swedish
universal health services in that all the programs provide affordable medication to citizens.
The packages facilitate fundamental diagnosis and medication of patients up to an established
limit per year. On the other hand, Australia’s Medicare is considered to be poorly performing
in acute care and emergency services. The packages which are covered by this program are
essential costs which apply to nonfatal diseases (de Cos & Moral-Benito, 2014). However,
universal health coverages in Sweden and Canada provide partial considerations to
emergency healthcare, home care, and elective care. Thus, it is advisable for the Australian
government to make adjustments to the system in a bid to improve service provision.
Financial Implications for the Healthcare System in Australia, Sweden, and Canada
With the existing healthcare systems in these three countries, citizens are compelled
to pay taxes or medical levies while also remitting insurance premiums to private companies
(Morgan & Astolfi, 2015). Going with this trend, healthcare providers have also increased the
costs of medication to accommodate the risks of treating patients under the Medicare
packages or universal healthcare programs. In the end, there are excess funds and high prices
associated with healthcare while the social determinants of health remain unchanged. That is,
insurance coverage has surprisingly become lucrative ventures for practitioners and lobbyists
while the insureds barely receive quality healthcare (Yaya & Danhoundo, 2015). Instead of
focusing on healthy living and health education, the existing healthcare systems are
encouraging enormous wastages in healthcare. This has resulted in social inequalities in
Australia, Sweden, and Canada because patients are discriminated according to their health
insurance cards. The increasing medical costs are also associated with economic disparities,
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HEALTH FINANCIAL MANAGEMENT 6
rationing of healthcare, and insufficiency of funds for conducting social programs (Moreno-
Serra, 2014).
Challenges of the Healthcare System
Healthcare systems like Medicare are usually established to subsidize the costs of
treatment and improve the quality of care. However, the systems are often affected by
structural complexities which hinder the realization of such objectives. The first one entails
demographic changes in a country. Usually, an ageing population increases the costs of
medical cover and social care (Gori, Fernandez & Wittenberg, 2015). This is the exact
scenario witnessed in stable countries like Australia, Sweden, and Canada. Therefore, it
would be necessary to make regular adjustments to the healthcare system in order to raise the
costs of medical cover (Gori, Fernandez & Wittenberg, 2015). In doing so, the patients will
be charged higher costs thus creating economic disparities and social inequalities.
Secondly, there are challenges in dealing with the private and public funding of
healthcare. In economies where healthcare financing is derived from a mix of private and
public sources, the government might be influenced to adopt market mechanisms to sustain
the increasing budgetary requirements (Corallo et al, 2015). As a result, prices will be set
according to the market of medical services and other factors like GP surcharge thereby
causing inefficiency of the system. Thirdly, healthcare systems in Australia, Sweden, and
Canada can be affected by technology costs. Even though technological innovations are
improving the quality of diagnosis and patient care, the same breakthroughs are creating
constraints on the national budget due to maintenance issues (Martin et al, 2015). Thus, it can
be prudent to adopt technologies which promote healthcare as well as the sustainability of
resources. Lastly, healthcare systems in Australia have been challenged by equity issues.
While there exists a Medicare program for all citizens, healthcare providers have introduced
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HEALTH FINANCIAL MANAGEMENT 7
premium packages for the affluent population. As a result, the system has reported health
inequality and social disparities in Australia.
Recommendations
Firstly, the government should implement policies for efficiency gains and
subsidization of healthcare as a way of alleviating the issues associated with demographic
changes (Cashin, Chi, Smith, Borowitz & Thomson, 2014). Secondly, the government needs
to evaluate its technologies and introduce automated systems which do not require additional
expenses for maintenance. This way, it will be possible to reduce the budgetary constraints of
supporting innovation and repair of technological equipment. Thirdly, the government should
encourage public funding in its healthcare systems as opposed to private funding (Cashin et
al, 2014). This is because, public funding is not affected by market forces which might
suddenly shift and cause budgetary constraints. Lastly, it would be appropriate to standardize
all the packages of Medicare program. This will improve the effectiveness of the system and
efficiency of service delivery.
Conclusion
According to the comparative analysis of the healthcare systems of Australia,
Sweden, and Canada, it has been established that both nations have universal healthcare
packages aimed at improving the quality of patient care. The financial results revealed that
Sweden has the highest allocation, followed by Canada while Australia ranks last among the
three OECD states. It was also discussed that Australia has a Medicare plan which promotes
affordable healthcare for fundamental diagnosis and treatments across the nation.
Accordingly, some challenges were highlighted and their possible recommendations also
mentioned. It was perceived that such adjustments in the Medicare program can help
Australia to attain the level of Sweden and Canada in healthcare provision.

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HEALTH FINANCIAL MANAGEMENT 8
References
Carpenter, A., Islam, M. M., Yen, L., & McRae, I. (2015). Affordability of out-of-pocket
health care expenses among older Australians. Health policy, 119(7), 907-914.
Cashin, C., Chi, Y. L., Smith, P. C., Borowitz, M., & Thomson, S. (2014). Paying for
performance in health care: implications for health system performance and
accountability. McGraw-Hill Education (UK).
Corallo, A. N., Croxford, R., Goodman, D. C., Bryan, E. L., Srivastava, D., & Stukel, T. A.
(2014). A systematic review of medical practice variation in OECD countries.
Health Policy, 114(1), 5-14.
de Cos, P. H., & Moral-Benito, E. (2014). Determinants of health-system efficiency:
evidence from OECD countries. International journal of health care finance and
economics, 14(1), 69-93.
Gori, C., Fernandez, J. L., & Wittenberg, R. (Eds.). (2015). Long-term care reforms in
OECD countries. Policy Press.
Karanikolos, M., Heino, P., McKee, M., Stuckler, D., & Legido-Quigley, H. (2016). Effects
of the global financial crisis on health in high-income OECD countries: a narrative
review. International journal of health services, 46(2), 208-240.
Martin, D., Miller, A. P., Quesnel-Vallée, A., Caron, N. R., Vissandjée, B., & Marchildon, G.
P. (2018). Canada's universal health-care system: achieving its potential. The Lancet,
391(10131), 1718-1735.
Molarius, A., Simonsson, B., Lindén-Boström, M., Kalander-Blomqvist, M., Feldman, I., &
Eriksson, H. G. (2014). Social inequalities in self-reported refraining from health
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care due to financial reasons in Sweden: health care on equal terms? BMC health
services research, 14(1), 605.
Moreno-Serra, R. (2014). The impact of cost-containment policies on health expenditure.
OECD Journal on Budgeting, 13(3), 1-29.
Morgan, D., & Astolfi, R. (2015). Financial impact of the GFC: health care spending across
the OECD. Health Economics, Policy and Law, 10(1), 7-19.
Mossialos, E., Wenzl, M., Osborn, R., & Sarnak, D. (2016). 2015 international profiles of
health care systems. Canadian Agency for Drugs and Technologies in Health.
OECD. (2019). Health Spending. Retrieved from https://data.oecd.org/healthres/health-
spending.htm
Yaya, S., & Danhoundo, G. (2015). Introduction: special issue on innovations in health care
system reform in OECD countries. The Innovation Journal, 20(1), 1.
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