Comparison of Healthcare Systems in Australia and United States
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This article compares the healthcare systems of Australia and United States on parameters like funding, governance, population health indicators, health system performance indicators, quality and safety of healthcare system, and equity.
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Running head: HEALTHCARE SYSTEMS Healthcare systems Name of the Student Name of the University Author note
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1HEALTHCARE SYSTEMS Intoday’sworldscenario,internationalcomparisonsaremadetoevaluatethe performance of healthcare system being a fairly common approach that support or refute arguments for change in the healthcare system. The healthcare comparisons between countries are made influencing major policy moves and healthcare spending. Moreover, international healthcare system comparisons act as additional lens on quality of care that is provided nationally. Through healthcare comparison report assessment, policy-makers get benchmark allowing them to identify areas performing below or above expectations. More importantly, this comparison provides impetus for understanding the driving force for performance and guide themlookingforpotentialsolutions.However,internationalcomparisonsneedfunding arrangements serving different populations as well as facing challenges in limited resources, demographicchangeand risingcosts. Therefore,to study the existingorganizationsand structures of healthcare systems, the following discussion involves comparisons made between two countries, Australia and United States on the following six parameters. Funding for healthcare systemsis critical for achieving universal health coverage. The developments made in health financing areas determine that whether health services are available for everyone affording health services when required. Taking this parameter into consideration, Australia’s funding systemgives access to comprehensive services that are funded publicly by general taxation. This system is responsible for funding healthcare services in territories and states delivering public health services and local governments providing environmental health programs. It is funded by different government levels from local to national level supported by health insurance (Aihw.gov.au, 2018).Medicareis funded and administered by Australian government consisting of three major healthcare components; medical services pharmaceuticals prescription and treatment given in hospitals jointly funded by Australian and territory/state
2HEALTHCARE SYSTEMS governments. Although, there is Medicare levy, it comprises of small part of total finance having high dependence on out of pockets with 17% of total expenditure. Funding through government dominates with total expenditure of 43% provided by Commonwealth and 25% by other levels of government exhibiting that Commonwealth plays a dominant role in the policy-making process. In Australia,total GDP health spendingduring the year 2015-2016, was $170.4 billion, $6.0 billion (3.6%)billion high than previous years where it was the consecutive fourth year where growth was seen to be below 10 average years - 4.7% (AIHW, 2018). On a contrary, United States healthcare funding system is high as compared to other countries as in this case, Australia putting a strain on overall economy that necessarily does not translate into better health. Like Australia, healthcare funding is paid by Medicaid and Medicare, private insurance plans (through employers) and individual’s own funds or out-of-pocket funding system. Government insurance programs are the largest whereMedicarefunds healthcare for people with long-term treatment, disabled and elderly.Medicaidfund healthcare for the people with disabilities or living under poverty level. Private insurance is purchased from not-for-profit or for-profit insurance companies shared by employees and employers where amount of money spent by employers on health insurance of employee is not taxable for employee.Affordable Care Act (2014)intended to increase affordability, availability and health insurance usage creating incentives for employers providing health insurance. In out of pocket system, people who are not covered under health insurance, people pay from their pockets. However, flexible spending and health savings accounts are offered by employers who choose to pay out of pocket health expenses through these small accounts. In 2016,U.S. GDPhealthcare spending increased to 4.3% reaching $3.3 trillion ($10,348 per person). As a share of nation’s GDP, 17.9% is accounted for health spending (Cms.gov, 2018).
3HEALTHCARE SYSTEMS TheAustralian health systemand system governanceis multi-layered sharing funding and responsibility by individuals, governments, private health insurers and health providers. Primary careis the primary level of care provided by GPs referring toMedicare services providing subsidised or free benefits. Acute care is provided in public or private hospitals. Public hospital provides treatment free to public patients subjected to long waiting hours. On the other hand, private hospitals work towards catering to the needs of patients who want private accommodation or choice of doctor including specialist services. Funding and regulation of health system is shared between Commonwealth, territory and state governments (Aph.gov.au, 2018). Commonwealth has responsibility at various levels. Medicare is the national scheme providing subsidised or free access to diagnostic, medical and allied services underMedical Benefits Schedule (MBS). General taxation revenue and 1.5% of Medicare levy fund Medicare that offset high-out-of pocket health costs. Pharmaceutical Benefits Scheme (PBS) subsidises the universal access to prescription medicines. The purchasing of vaccines, aged care services subsidization, medical research grants, veteran services, Aboriginal and TSI healthcare services, health professional education and national coordination for leadership and responding to health emergencies (Aph.gov.au, 2018). Territories and states are have the responsibilityfor administration , management of public hospitals, preventive services delivery, funding and management of mental health and, dentalclinics,communityservices,ambulanceandemergencyservices,patienttransport schemes, subsidy, handling regulation and food safety and monitoring of other premises of health. Finally, territories, states and Commonwealth shares responsibilities under theCouncil of Australian Governments(COAG) that includes public hospital services funding, preventive
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4HEALTHCARE SYSTEMS services, shared palliative care, mental health services and national health emergency responds (Aph.gov.au, 2018). On a contrary, the U.S. health system governance is different from Australian system comprising of federal government, The U.S. Department of Health and Human Services (HHS) beingtheprincipalagencyforprovidinghealthcareservices.HHScomprisesofmany organizations; Centres for Medicare and Medicaid services, Centres for Disease Control and Prevention(CDC)andNationalInstitutesofHealth.HealthResourcesandServices Administration Food and Drug Administration (FDA) and Agency for Healthcare Research and Quality are also present that is similar to Australian healthcare system mentioned above (International.commonwealthfund.org, 2018). Publicly financed healthcareis funded by Medicare through premiums, payrolls, federal general revenues that are tax-funded.Privately funded healthcareaccount for 39% is also similar too Australia’s private insurance system which is tax-exempt and voluntary premiums shared by workers and employers on employer-specific basis.Primary careaccounts for one third of U.S. physicians operating in group or small self owned practices including nurses and clinical staffs paid by practice. In U.S. physicians are paid through negotiated fees, capitation and administrative set fees.Outpatient specialist carework in both hospital and private practice provide access to various specialists.Hospitalsalso include private hospitals who are paid through per-dim charges or per-service, bundled or per-case payments where hospitals are held accountable for services following discharge and readmissions.Mental health servicesare also provided that work through provider type and payer.Long-term careis provided by myriad of nonprofitsandprofitproviderspaidthroughprovidertypeandpayer.Fromtheabove comparison, it can be deduced that U.S healthcare costs are high and as compared to Australia
5HEALTHCARE SYSTEMS ranking last overall. The U.S. quality of healthcare rank fifth, however in terms of equity, efficiency and citizen healthiness ranked last (International.commonwealthfund.org, 2018). Population Health Indicators likeInfant Mortality Rate (IMR), Maternal Mortality Rate (MMR), and Life Expectancy at birthare also compared between the two countries. Among the MMR 2017 country rank list, Australia ranks 120thposition (6 deaths/100,000 live births) whereas United States ranks 112 (114 deaths/100,000 live births) for the year 2015. This suggests that MMR is more in U.S. as compared to Australia indicating poor management during childbirth or complicated pregnancy for a specified year being worst in the list of developed countries. This also indicatesthat funding is poor in case of child and maternalhealth (aihw.gov.au, 2018). Infant mortality rate (IMR) for Australia as per 2015 statistics include 4.6 deaths/1,000 live births for males and 3.9 deaths/1,000 live births for males on an average of 4.3 deaths/1,000 live deaths. On a contrary, IMR for males is 6.3 deaths/1000 live births and 5.3 deaths/1,000 live births for females on an average 5.8 deaths/1,000 live deaths. This statistics clearly depict that there is lack of healthcare services, poor maternal health, postnatal and prenatal care contributing to increase IMR in U.S. as compared to Australia that shows better statistics (Abs.gov.au, 2018). Life expectancy at birthfor females in Australia and U.S. is 84.1 and 81.1 (years) ranked 12thand 43th respectively. Based on this statistics, it can be concluded that life expectancy in Australia is 4% more as compared to U.S. In case of life expectancy at birth for males in Australia is 81.85 ranking 11thand 78.64 for U.S. ranking 40thin the world. This ranking suggests that it is again 4% more than U.S. This parameter also shows that better medical services are available in Australia than U.S (Abs.gov.au, 2018).
6HEALTHCARE SYSTEMS Health System Performance Indicatorsare also compared between the two countries. Low birth weight infantsin Australia as per 2015-2016 statistics is 1.4% as per Agpar scores depicting low scores it terms of birth weight weighing less than 1500 grams. On a contrary, in U.S. low birth weight accounts for 8.07% weigh below 2500 grams with 9.63% preterm born. This suggests that children are born in poor and unequal environments in U.S. as compared to Australia (Carinci et al., 2015). Obesityin Australia is 29% and 36.2% in United States respectively suggesting that it is major health issue in the country as compared to Australia giving rise to co-morbid conditions like coronary heart disease (Walls et al., 2012). In terms ofdiabetes, about 9.4% or 30.3 million people suffer from it as per 2015 statistics with 1.25 million suffering from type one diabetes. In Australia, 1.2 million (6%) people suffer from diabetes as per 2014-2015 statistics. This depicts that U.S. has high diabetes prevalence than Australia (Guariguata et al., 2014). As per 2016 statistics, 2.5 million people or 10.8% Australians hadasthmaduring the year 2014-2015 that increased since 2008 (9.9%). Females has high asthma rates than males in 2014-2015 being asthma common and consistent over the years. In U.S. about 300 million people suffer from asthma showing that there is high prevalence in the country as compared to Australia as per 2017 statistics (Ford, 2015). This also shows that about many children and women were prone to condition.Hypertensionin U.S. is 54% or 75 million suggesting one in three adults suffering from it increasing cost of healthcare. About 11.3% or 2.6 million Australians have reported hypertension with highest prevalenceamong malesthan femaleswith 12.0% and 10.7% respectively. In this parameter, it also suggests that U.S. has high hypertension prevalence than Australia (Venuthurupalli et al., 2018). As perAmerican Cancer Society, in 2015 about 1.5 million people suffered from cancer, although a drop by 22%. Cancer in Australia is reported to
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7HEALTHCARE SYSTEMS be410,530 people suffering from the disease. This parameter explains that cancer prevails more in U.S. than in Australia (Siegel et al., 2015). Taking the quality and safety of healthcare system into consideration, as declared by American researchers, Australian healthcare system ranked best among the developed countries as compared to United States. The mixed public-private system is the second best among the developed countries. The above statistics on MMR and IMR states that U.S. has the highest rate andexperiencedsmallestreductionduringtherecentyearsdespiteofspendingtwice, performance in quality of healthcare is lacklustre. The healthcare system of Australia and U.S. is similar having mixed private-public structure where both private and public is providing funding delivering healthcare. However, there are differences in management, orientation and quality of healthcare delivery (Squires & Anderson, 2015). Australian healthcare system believes in the fact that every person should have equal rights to health promoting equity. However, equity is in much debate. This equity is non-existent among U.S. healthcare system, as they believe that independence is associated with monetary success. Americans believe that people should be responsible for their health. This ideology has led to the inequality in healthcare with around 45 million people without any insurance coverage (Moses et al., 2015). On a contrary, Australian healthcare system opposes American system where equity is supported for public sector as compared to private sector. The privatized system has led to high quality of care and efficient service delivery with low waiting lists being the highest spender of money in healthcare. However, service delivery and quality of care is not efficient in Australia with long waiting hours making access to resources difficult. The access to healthcare is lacking as expensive healthcare costs makes it greatly inaccessible for Americans (Mossialos et al., 2016).
8HEALTHCARE SYSTEMS Therefore, from the above discussion, it can be concluded that although, healthcare spending is more in America, Australia provides better equity to healthcare services, although limited as compared to U.S. This is quite evident from the high rates of MMR, IMR, diabetes, obesity, hypertension when compared to Australian healthcare system. The mixed market of Australia although has short healthcare services efficiency, they produces more access and equity for their people as compared to U.S.
9HEALTHCARE SYSTEMS Appendix Figure 1- Australia’s healthcare funding (Source- www.aihw.gov.au)
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13HEALTHCARE SYSTEMS Figure 7- USA asthma rates (Source- www.cdc.gov)
14HEALTHCARE SYSTEMS Figure 8- Australia asthma rates (Source- www.aihw.gov.au)
15HEALTHCARE SYSTEMS References Abs.gov.au,(2018).Deaths,Australia,2015.Retrieved3February2018,from http://www.abs.gov.au/AUSSTATS/abs@.nsf/Previousproducts/3302.0Main %20Features52015? opendocument&tabname=Summary&prodno=3302.0&issue=2015&num=&view= AIHW. (2018).Health & welfare expenditure.Australian Institute of Health and Welfare. Retrieved3February2018,fromhttps://www.aihw.gov.au/reports-statistics/health- welfare-overview/health-welfare-expenditure/reports aihw.gov.au.(2018).Classificationofmaternaldeaths.AustralianInstituteofHealthand Welfare. Retrieved 3 February 2018, from https://www.aihw.gov.au/reports/mothers- babies/maternal-deaths-in-australia-2012-2014/contents/classification-of-maternal-deaths Aihw.gov.au. (2018).Health expenditure Australia 2015–16.Aihw.gov.au. Retrieved 3 February 2018,fromhttps://www.aihw.gov.au/getmedia/3a34cf2c-c715-43a8-be44- 0cf53349fd9d/20592.pdf.aspx?inline=true Aph.gov.au. (2018).Health in Australia: a quick guide – Parliament of Australia.Aph.gov.au. Retrieved3February2018,from https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/ Parliamentary_Library/pubs/rp Carinci, F., Van Gool, K., Mainz, J., Veillard, J., Pichora, E. C., Januel, J. M., ... & Haelterman, M. (2015). Towards actionable international comparisons of health system performance:
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16HEALTHCARE SYSTEMS expert revision of the OECD framework and quality indicators.International Journal for Quality in Health Care,27(2), 137-146. Cms.gov. (2018).Historical - Centers for Medicare & Medicaid Services.Cms.gov. Retrieved 3 February2018,from https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and- Reports/NationalHealthExpendData/NationalHealthAccountsHistorical.html Ford,E.S.(2015).TrendsinmortalityfromCOPDamongadultsintheUnited States.Chest,148(4), 962-970. Guariguata, L., Whiting, D. R., Hambleton, I., Beagley, J., Linnenkamp, U., & Shaw, J. E. (2014).Globalestimatesofdiabetesprevalencefor2013andprojectionsfor 2035.Diabetes research and clinical practice,103(2), 137-149. International.commonwealthfund.org. (2018).United States : International Health Care System Profiles.International.commonwealthfund.org.Retrieved3February2018,from http://international.commonwealthfund.org/countries/united_states/ Kim, S., Sargent-Cox, K. A., French, D. J., Kendig, H., & Anstey, K. J. (2012). Cross-national insights into the relationship between wealth and wellbeing: a comparison between Australia, the United States of America and South Korea.Ageing & Society,32(1), 41-59. Moses, H., Matheson, D. H., Cairns-Smith, S., George, B. P., Palisch, C., & Dorsey, E. R. (2015).Theanatomyofmedicalresearch:USandinternational comparisons.Jama,313(2), 174-189.
17HEALTHCARE SYSTEMS Mossialos, E., Wenzl, M., Osborn, R., & Sarnak, D. (2016).2015 international profiles of health care systems. Canadian Agency for Drugs and Technologies in Health, pp. 11-20. Mossialos, E., Wenzl, M., Osborn, R., & Sarnak, D. (2016).2015 international profiles of health care systems. Canadian Agency for Drugs and Technologies in Health, pp. 162-171. Nathan, R. A., Thompson, P. J., Price, D., Fabbri, L. M., Salvi, S., González-Díaz, S., ... & Murphy, K. (2015). Taking aim at asthma around the world: global results of the asthma insight and management survey in the Asia-Pacific region, Latin America, Europe, Canada, and the United States.The Journal of Allergy and Clinical Immunology: In Practice,3(5), 734-742. Siegel, R., Ma, J., Zou, Z., & Jemal, A. (2014). Cancer statistics, 2014.CA: a cancer journal for clinicians,64(1), 9-29. Squires, D., & Anderson, C. (2015). US health care from a global perspective: spending, use of services, prices, and health in 13 countries.The Commonwealth Fund,15, 1-16. Venuthurupalli, S. K., Hoy, W. E., Healy, H. G., Cameron, A., & Fassett, R. G. (2018). CKD Screening and Surveillance in Australia: Past, Present, and Future.Kidney international reports,3(1), 36-46. Walls, H. L., Magliano, D. J., Stevenson, C. E., Backholer, K., Mannan, H. R., Shaw, J. E., & Peeters,A.(2012).Projectedprogressionoftheprevalenceofobesityin Australia.Obesity,20(4), 872-878.