Health systems refer to a particular system that involves different people from different organizations and institutions that have a single objective. This objective is to meet the health needs or provide health care services to a certain number of people in a certain place. These services are provided by various health care providers including nurses, doctors, dentists, optometrists, and other health professionals. These individuals may be part of for-profit/non-profit organizations, government organizations, or charities.
So where do these organizations and institutions get their funds to carry out their tasks? Basically, there are five ways that health care systems are financed: taxes, social security, private health insurance, out-of-pocket costs, and donations.
Most of the time, individuals and people who own different types of property are known to be taxpayers. Unlike other types of payments and donations, taxes aren’t really something you can decide not to pay because you have to. Like it or not, you have to pay a certain amount of taxes to support the government and its programs. It is something that the government requires to be paid at a certain time. A portion or a small portion of the taxes collected will be given to government-run health care organizations as their funds.
Social insurance, on the other hand, is another method of financing health care systems. Basically, this is a program that has the full support of the government. It can be financed by taxes but it can also be financed by premiums that are paid by the people involved or by other people on behalf of the people involved.
Private health insurance is similar to social insurance in some ways, but it also has its differences. Participation in private health insurance is not mandatory, but when buying insurance you will therefore have the opportunity to decide which insurer you want to go with. Your benefits will also be based on a contract while on social security, it will be based on a statute.
Out-of-pocket expenses refer to money spent that may or may not be reimbursed. It is basically the amount that the patient has to pay to the health care provider for the medical service provided without anyone else getting involved, such as an insurer or the government.
And last but not least, the financing method, donations, which is considered a gift given by anyone without expecting anything in return. Most of the time, donations are given for charity and to help other people. Donations can be in any form, including money, food, services, toys, and other items, as long as they are given voluntarily.Health care systems are not just funded by donations, there is more to it than you might think.
With these five methods, health care systems can serve their purpose very well. Different countries actually use a combination of any of the five methods to get their funds to provide health care services for their community.