How Are Health Care Systems Funded?

Health care systems refer to a particular system that involves different people from different organizations and institutions that only have one goal. This goal is to cater the health needs or to provide health care services to a certain number of people in a particular place. These services are provided by several health care providers which include nurses, doctors, dentists, optometrists and other health professionals out there. These people may be a part of for profit organizations/ non-profit organizations, government-owned organizations or charitable institutions.

So where do these organizations and institutions get their funds to perform their tasks? Basically, there are five ways in which health care systems are funded – taxation, social insurance, private health insurance, out-of-pocket expenses and donations.

Most of the time, individuals and people who own different types of properties are known to be taxpayers. Unlike other types of payments and donations, tax is actually not something that you can decide not to pay because is it has to be paid. Whether you like it or not, you have to pay a certain amount of tax to support the government and its programs. It is something that the government demands to be paid in a certain period of time. A portion or a small part of the collected taxes will then be given to health care organizations run by the government as their funds.

Social insurance on the other hand is another method of funding health care systems. Basically, this is a program that is completely supported by the government. It can be funded by taxes but it can also be funded by premiums which are either 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 they also have their differences. The participation in private health insurance is not compulsory but purchasing an insurance hence, you will have a chance to decide on which insurer you want to go with. Your benefits will also based on a contract while in social insurance, it is based on a statute.

Out-of-pocket expenses refer to the money that is spent which can either be refunded or not. It is basically the amount that the patient has to pay to the health care provider for the medical service provided without anybody else involved like an insurer or the government.

And last not the least funding method, donations.This is considered to a gift given by anyone without expecting anything in return. Most of the time, donations are given for charitable purposes and help other people. Donations can be in any form like money, food, service, toys and other items as long as they are voluntarily given.Health care systems are not only ones that are funded by donations but there are more than you know.

With these five methods, health care systems are able to serve their purpose very well. Different countries actually use a combination of any of the five methods in order to get their funds and provide health care services for their community.