Rethinking How We Finance Health Care: Medicine, Costs, Economics, Private Funding (2006)


There are generally five primary methods of funding health care systems:

general taxation to the state, county or municipality
social health insurance
voluntary or private health insurance
out-of-pocket payments
donations to health charities

In most countries, the financing of health care services features a mix of all five models, but the exact distribution varies across countries and over time within countries. In all countries and jurisdictions, there are many topics in the politics and evidence that can influence the decision of a government, private sector business or other group to adopt a specific health policy regarding the financing structure.

For example, social health insurance is where a nation’s entire population is eligible for health care coverage, and this coverage and the services provided are regulated. In almost every jurisdiction with a government-funded health care system, a parallel private, and usually for-profit, system is allowed to operate. This is sometimes referred to as two-tier health care or universal health care.

The management and administration of health care is another sector vital to the delivery of health care services. In particular, the practice of health professionals and operation of health care institutions is typically regulated by national or state/provincial authorities through appropriate regulatory bodies for purposes of quality assurance.[24] Most countries have credentialing staff in regulatory boards or health departments who document the certification or licensing of health workers and their work history.

Health information technology (HIT) is “the application of information processing involving both computer hardware and software that deals with the storage, retrieval, sharing, and use of health care information, data, and knowledge for communication and decision making” (Brailer, & Thompson, 2004). Technology is a broad concept that deals with a species’ usage and knowledge of tools and crafts, and how it affects a species’ ability to control and adapt to its environment. However, a strict definition is elusive; “technology” can refer to material objects of use to humanity, such as machines, hardware or utensils, but can also encompass broader themes, including systems, methods of organization, and techniques. For HIT, technology represents computers and communications attributes that can be networked to build systems for moving health information. Informatics is yet another integral aspect of HIT.

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