Comparing the Australian and the Norwegian Healthcare Systems - Case Study Example

A Report Comparing the Australian and the Norwegian Healthcare Systems Executive Summary This brief report presents a discussion comparing the healthcare systems in Australia and Norway. Both of the previously mentioned countries are affluent and developed nations that maintain relatively low populations. Norway maintains a population of about 4.9 million people living in 19 counties, while Australia maintains a population of about 17 million residing on a much larger area than Norway, in seven states. Both Australia and Norway take social responsibilities to those who are ill seriously and taxation together with contributory insurance schemes provide for the ill. However, Australia presents a mixed system of public and private care that presents more choices to those that are ill compared to Norway, which has a predominantly centrally planned state sponsored health system. The Norwegian system presents generous support to those who are ill, but long waiting lists for procedures exist despite a higher number of physicians per 100,000 population. Norway presents very limited patient choice and say. Australians have a guarantee of healthcare, no matter how expensive it becomes, and can decide about the quality of care that they receive by selecting their contributions to Medicare or private healthcare schemes. However, in Norway, the GP assigned to a patient decides about what the system will offer to a patient, and it is not easy to change the GP. Longer waiting lists and a lack of advanced diagnostic techniques, including use of MRI and CT scanning, points to a certain rationing and a lack of sophistication in the Norwegian system, despite its generous support for those that are ill. Access to drugs is better in the Australian system. Although the year 2000 WHO Health Report ranked Norway higher than Australia in terms of the performance of its health system, this report is now a decade old. The latest OECD Frequently Requested Healthcare Data points to the fact that the Australian healthcare system is now performing better and offering more choices to those who are ill with shorter waiting lists and access to more sophisticated diagnostic procedures compared to Norway. Life expectancy is higher in Australia, with a lower figure for Potential Years of Life Lost for the population, and the Australian system offers better pharmaceutical / drug assistance. It is certain that economic constraints have forced choices, and the Norwegian healthcare system has had to try to optimise. Thus, although it is likely that things will improve with the development of a parallel private healthcare system in Norway, it will be proper to say that at present the Australian healthcare system offers more to the ill compared to the Norwegian healthcare system. Contents Introduction 1 What Makes a Good Healthcare System? 2 The Healthcare System in Australia 4 The Healthcare System in Norway 8 Comparing the Australian and the Norwegian Healthcare Systems 11 Conclusion 12 Bibliography/ References 15 Introduction Over the last decade or so, health has become a major area of concern for all developed nations because of aging populations, heightened public expectations and demands together with availability of new medical technologies for healthcare (Blank, 2007, Pp. 1 – 2). The pressures to meet rising public expectations are intense in the face of a need to constrain healthcare costs and to allocate judiciously resources that are becoming increasingly scarce. However, an obvious link exists between health policy and the economic resources that are available to a nation, even though other factors, including historical forces and cultural values do influence the type of healthcare system that emerges in a nation (Mooney, 1999, Pp. 1 – 5). Scarce resources force choices that influence the best available for the many users of a healthcare system. Often both the public and the private sector actors influence the funding that fuels the healthcare system and the values espoused by these actors shape what is available. Thus, even among the developed nations, differences do exist in the way in which the healthcare system in a nation cares for the people. According to Matcha (2003, Pp. 11 – 17), it is possible to broadly classify healthcare systems that exist in the developed nations as entrepreneurial, Bismarck, Beveridge model, the state controlled model and a mix of models. Thus, although healthcare systems from around the world do enjoy areas of similarity, they also present important differences, especially in regarding to funding arrangements, delivery of services and effectiveness in terms of the health of those that they serve. The Beveridge model of the healthcare system persists in Norway and Sweden, while Australia presents a more mixed model of public and private healthcare (Matcha, 2003, Pp. 15) and (Willis, 2008, Pp. 4). It makes sense to try to compare the healthcare system in Australia and Norway because although both the previously mentioned countries are affluent, developed nations with relatively small populations, the healthcare systems of the two nations function and deliver somewhat differently. This brief research paper presents a comparison for the healthcare system for Australia and Norway. What Makes a Good Healthcare System? Despite the fact that perspectives do count, a good healthcare system that caters to the health needs of a large number of people should provide access to medical care without discrimination when a need exists for such an access (Gillies, 2003, Pp. 193 – 200). Healthcare is a universal problem for anyone in a nation and although the macro level results that present statistics related to spending per person, spending as a proportion of the GDP, access, type of healthcare services and procedures available, together with life expectancy, etc. do help with developing a picture, the quality of micro level interactions and affordability are important. A healthcare system should be able to meet the needs of individual patients and better still, prevent the need for individuals to seek medical care by promoting good health in a nation. Ideally, the socioeconomic status of individuals should not deter from the provision of best possible care at a time of need, but individuals should be encouraged to act responsibly to avoid becoming a burden on the nation. Gillies (2003, Pp. 194 – 200) goes further to state that any decent healthcare system should keep people healthy if possible by preventing illness and disease, make them healthy as cheaply as possible while providing quality healthcare when they are in need with due regard for the burden that individuals have the capacity for carrying and provide lifelong care for all. Modern healthcare systems should make it possible for individuals to maintain a quality of life and quality of care, while emphasising on the basics of healthcare. Life expectancy in a nation is a measure of the healthcare system performance, and life expectancy relative to the spending on healthcare as a percent of GDP measure efficiency in the delivery of healthcare. Available choices for healthcare, waiting times for surgical or other procedures, a capacity for consulting doctors of choice and options available to individuals for deciding about their care together with regard for capacity to pay makes a difference for individuals served by a healthcare system. According to the previously mentioned author, primary care in a decent healthcare system should be able to identify a need for specialist attention quickly and such attention should be available. Evidence, rather than political ideology should shape the way in which healthcare system functions and ideally, a healthcare system should not need individuals to depend on family with the system alone catering to the needs of any individual in need of care despite the value of the family in a society. The Healthcare System in Australia As mentioned previously, the Australian healthcare system presents a mix of public and private healthcare. However, tensions’ existing amongst groups within the country about what services the government should provide free and what needs handing over to the private sector in the country to present constant debate (Willis, 2008, Pp. 4 – 10). The Australian Health Ministers’ Advisory Council (AHMAC) consisting of representatives from Federal and state / territory governments advises the parliament about the mix relating to public and private healthcare and the political decisions relating to the healthcare system depend on the majority thinking in the Australian parliament. All governments, including the Federal government, state or territory governments and local governments in Australia provide some form of healthcare, but Medicare, a compulsory, universal health insurance scheme funded by general and progressive individual taxation based on income covers all Australians. Thus, although the Medicare scheme covers all Australians, they can access better quality in healthcare by paying to private concerns, if they want to do so. Willis (2008, Pp. 4 – 10) states further that the Medicare scheme funds public hospitals and provides payments to medical practitioners to provide care. All Australians are eligible for up to 85% of the scheduled fees for healthcare services set by Medicare, and this means that they have to pay about 15% themselves. However, the Family Safety Net scheme reimburses 100% of costs to families once healthcare expenses exceed a certain threshold. Thus, everyone has a guarantee of receiving healthcare, no matter how expensive this becomes, despite the fact that Australians must pay a certain proportion out of their own pockets if the costs are not burdensome. According to the previously mentioned author, the Federal government in Australia funds the Pharmaceutical Benefits Scheme (PBS), which provides Australians with a guarantee of access to all medicines listed under this scheme prescribed by all those with prescribing rights. Those in difficult financial circumstances pay low rates for all medicines covered under the PBS scheme, while those Australians who can afford to pay for their medicines pay higher rates. The state and territory governments in Australia provide free ambulatory and in-hospital care to citizens who reside within their jurisdictions, including all emergency and outpatient care, elective surgery and medications needed by patients (Willis, 2008, Pp. 6 – 7). However, a waiting list exists for elective surgery, even though the waiting periods must not compromise patient safety and long waiting lists exist for publically funded dental care. Local governments contribute to preventive healthcare by maintaining food standards, affecting public health measures, including garbage and sanitation, together with health promotion efforts that involve education and promotion of healthy living environments. According to Willis (2008, Pp. 7 – 10), Australians have a choice to seek higher quality of care or alternatives to what is available under the public healthcare system by seeking private healthcare for which Medicare pays 75% of the fees, and it is possible to seek 100% coverage for private healthcare by paying more for healthcare insurance coverage. Thus, Australians have a wide variety of healthcare options to choose from, depending on their state of health and desire for quality of care by contributing more towards their healthcare insurance. Clearly, those who are young and healthy will not want to pay high coverage for excellence in healthcare, but those with higher risks will want to cover themselves for the best. Thus, while guaranteeing healthcare access to all, the healthcare system in Australia encourages individual responsibility for health and the creation of a healthy environment in which no one is denied meaningful and real healthcare when in need. Even complementary and alternative healthcare regulated by the government is available to Australians should they desire to avail themselves of this option (Willis, 2008, Pp. 155 – 157). Although the mix of funding for the Australian healthcare system has resulted in much cost shifting and blame shifting between the Federal and state / territory governments, it is worth noting that the healthcare system in Australia has worked well for Australians (Courtney, 2004, Pp. 6 – 8). In the year 2000, the Australian Institute of Health and Welfare noted that during the twentieth century, Australians experienced an increase in expected life expectance of almost 30 years for males (60%) and 23 years for females (40%). Healthcare expenditure as a percentage of the GDP has increased progressively, up from 7.0% in 1999 to about 8.5% in the year 2008. However, the original Australians, the Aborigines and other indigenous groups lag behind the rest of Australians in presenting benefits received from the healthcare system, with a life expectancy that was lower by about 20 years compared to the mainstream. Perhaps the unhealthy lifestyle and a tendency for alcoholism exhibited by these groups are to blame for their predicament. According to the World Health Organisation World Health Report of 2008, surveys in Australia suggest that a high number of people reported safety risks, poor care coordination and deficiencies in care for chronic conditions, despite the fact that Australia ranked number 2 in terms of life expectancy and seventeenth in terms of healthcare equality. World Health Organisation World Health Report of 2000 ranked Australia 12 in overall goal attainment and 32 in terms of overall health system performance, behind Singapore, which ranked 6, Norway, which ranked 11, UK, which ranked 18, but ahead of USA, which ranked 37 (WHO, 2010, “The World Health Report”). The OECD Health Data (2010, “Frequently Requested Data”) puts Australia as having the highest number of MRI scanners per million of population among all OECD countries and a lower figure for Potential Years of Life Lost (PYLL), a summary measure of premature mortality, than the United Kingdom or Norway. The Healthcare System in Norway Chew-Graham (2008, Pp. 166 – 167) states that until very recently the public sector healthcare system has been the only professional healthcare service in Norway. Although the private sector is gradually growing in size, the public sector still provides most health services in the country using public funds. A three-tier system of healthcare exists in Norway based on the Municipal Healthcare Act, the Social Care Act, the Hospital Act and the National Insurance Act. The Norwegian State provides specialist healthcare services, including hospitals and the local authorities manage the patient list system, which allocates patients from a defined segment of the population to the care of a GP who then acts as a gatekeeper to the system and request for specialist care for patients as needed. Norway has a population of about 4.9 million people living in 19 counties and this country endorses the principle of equality in access to healthcare for all people, with planning for the healthcare system entrusted to the central government (Eberhardt, 2005, Pp. 95 – 98). According to the previously mentioned author, municipalities provide for primary care, while central government maintains the secondary care system through five Regional Health Enterprises (RHEs). Patients can now select any Norwegian hospital for non-acute care and regulations for the pricing and reimbursement of pharmaceuticals now exist in the country. Establishment of private hospitals has been of relevance to Norway because the waiting lists for surgical procedures in public hospitals are long. Eberhardt (2005, Pp. 96 – 98) goes further to state that a National Insurance Fund (NIF) has existed in Norway since 1967 that provides for free hospital care when needed, free medical care during pregnancy and delivery, economic compensation for employed persons during illness and maternity leave with 100% salary for 42 weeks or one year with 80% salary. In addition, the NIF provides for subsidised medical consultations and subsidies for necessary medication for chronic diseases together with a disability pension for formerly employed persons with chronic disabilities. Oral health services are free for children up to the age of 18, but adults must pay for these. Patients are required to cover expenses on dental care and services provided by opticians. It is possible for Norwegians to opt out of the government healthcare system and pay out of pocket to go to a foreign country for medical treatment, especially when waiting lists are long. Benefits for the sick and the disabled are very generous, with payments available even for spa treatments but a requirement exists for small copayments for outpatient treatments. Patients can only switch GPs twice a year if there is no waiting list for a requested GP and physicians are usually salaried persons employed by the state, with a few receiving annual grants and a fee-for –service compensation set by the state (Tanner, 2008, Pp. 18 – 19). According to the previously mentioned author, waiting lists are a severe problem with the Norwegian healthcare system and these may represent a defacto rationing of services. In addition, under the Norwegian system, it is possible to deny care if it is judged to be cost ineffective. Healthcare spending in Norway has progressively increased from 7.5% of the GDP in 1990 to 8.5% of the GDP in 2008, with a per capita expenditure of US$3844 in the year 2007, compared to US$3353 for Australia in the same year (The OECD Health Data, 2010, “Frequently Requested Data”). According to the previously mentioned reference, public expenditure on healthcare in Norway as a proportion of total healthcare expenditure stood at 79.8% in comparison to 67.5% in Australia for the same year. There were 3.9 practicing physicians in Norway per 1000 heads of population compared to 2.97 in Australia, despite the fact that Australia produced more medical graduates per 100,000 head of population compared to Norway. There were more hospital beds in Norway per 1000 heads of population compared to Australia (4 in Norway, compared to 3.9 in Australia), but Norway lags significantly behind Australia in the use of MRI and CT scans. Life expectancy for all population is higher in Australia at 81.5, compared to 80.6 for Norway and public expenditure on pharmaceuticals per capita was higher in Australia at US$480 compared to US$383 in Norway. However, the WHO in its year 2000 rankings had placed Norway higher, with a rank of 11 in terms of overall system performance compared to Australia, which ranked 12 (WHO, 2010, “The World Health Report”). Comparing the Australian and the Norwegian Healthcare Systems Although the WHO rankings had placed Norway higher than Australia, (11 compared to 12 for Australia), in its year 2000 report, it is important to note that this report is now a decade old. Thus, it makes sense to try to compare the Australian and the Norwegian healthcare systems based on the more recent OECD data and data available in the Cato Institute report (Tanner, 2008, Pp. 18 – 19) and (OECD Health Data, 2010, “Frequently Requested Data”). As discussed previously, it is proper to assess a healthcare system from a user perspective, and although the Norwegian healthcare system presents generous benefits, the Australian system presents more choices and smaller waiting lists compared to the Norwegian system. The Australian healthcare system denies no one, but in Norway, the system can say no to treatments judged less cost effective. The use of information technology and MRI / CT scanning is more evident in Australia compared to Norway, with Australians living longer with lower Potential Years of Life Lost (PYLL). Public support for a provision of drugs to the ill is more evident in Australia compared to Norway. Thus, clearly Australia has a better healthcare system than Norway, even though Norway provides the sick more terms of maintaining an income. Conclusion It is clear from the previous discussion that both Australia and Norway take national responsibility to those that are ill seriously, with national health insurance schemes and public taxation funding public healthcare systems. However, the centrally planned Norwegian healthcare system presents an almost exclusive government responsibility that results in fewer choices for the sick, compared to the Australian system that provides for choices by permitting a mix of the public and the private. Despite the generosity displayed to those who are ill in Norway, the waiting lists are long and patients have a limited say in their treatment. Australia too has waiting lists, but the private healthcare system that offers far more for slightly higher medical insurance costs for those who are at a higher risk presents a safety net. 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