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It's been a while since we've done an international health care system episode. We thought you might need a break. That break ends now. Australia has the only continental, universal health care system, and it's topic of this week's Healthcare Triage.

For those of you who want to read more, go here:

John Green -- Executive Producer
Stan Muller -- Director, Producer
Aaron Carroll -- Writer
Mark Olsen -- Graphics


It's been a while since we've done an international healthcare system episode. We thought you might need a break. That break ends now. Australia has the only continental universal healthcare system, and it's the topic of this week's Healthcare Triage.



Like pretty much every other country we've covered, say, the United States, Australia has a universal healthcare system. It's called Medicare. What is the deal with that? Seriously, do none of these countries have a thesaurus or something? Medicare, Medicare, Medicare. Anyway, Australia's national public system provides coverage for citizens, permanent residents, and even many people with temporary visas. There's a program for visiting students and even people seeking asylum get coverage while their cases are under review. Australia also has a voluntary private health insurance system which complements and supplements the public one. It can give citizens access to private hospitals and some services not covered by the public system. The tax system incentivizes the purchase of private insurance for many individuals and families. Medicare also allows people to get free inpatient care in public hospitals, free access to most medical services, and prescription drugs. The federal government also works with more local governments to provide population health, mental health, some dental care, some physical therapy, and services for veterans. Medicare pays for somewhere between 85% and 100% of outpatient services. It also pays for 75% of the medical fees schedule for private patients who use public hospitals. Whatever isn't covered must be paid for by patients. 


Doctors can charge whatever they want, although incentives are in place to make bulk billing more likely for the elderly, poor people, children and people who live in rural areas. Members of those groups also get a discount on drugs. Their co-pays on prescriptions are around $5.90 Australian, versus $36.10 for everyone else. There are out of pocket maximums. When an Australian has paid out $421.70, then Medicare covered 100% of the fees scheduled for doctors for the rest of the year. When they reach $1,221.90, then 80% of all out of pocket costs are covered for the rest of the year. For people in the special groups I mentioned before, the threshold is lowered to $610.70. Yes, that's complicated. Thanks, Australia.

There are also ways for families to pool such spending and to hit the limits faster. There are pharmaceutical subsidies for those who reach of $1,391 in a calendar year too, for drugs. The threshold is also lower for those in the special groups at $354. 
Australia has one of the cheaper healthcare systems at 8.9% of GDP. Medicare is paid for mostly from general taxes, patient fees, and a 1.5% levy on taxable income. In 2010 - 11, the government funded about 69% of spending. 43% at the federal level, and 26% from states and territories. The rest, for about 31% of healthcare spending, comes from non-government sources. About 18% is out of pocket spending, in co-pays or services not covered by insurance. Private health insurance accounted for about 8% of spending. About half of people have private insurance, which allows them more options in practitioners, hospitals and care that they receive.

Those who opt for private insurance before their 31st birthday get a reduction in premiums for the rest of their lives. Each year an Australian waits to start buying private insurance after they're 30 sees their rates go up 2% from a base rate, again, for as long as they live. Subsidies have been available to many Australians based on income since 1999.

 Doctors, Services and Facilities

Most primary care doctors are self-employed in working groups. About 8% of them are under contract with private agencies. Most work in a fee-for-service system. Most also get incentive payments for meeting standards set by the Royal Australian College of General Practitioners. In other words, they have a pay for performance system to try to improve quality. I know you watched that video, right?

Patients can see any general practitioner they like. GPs do however, need to refer them to specialists. Specialists also work on a fee-for-service basis and many of them work in both the public and private parts of the system. After hours care is available either from primary care docs themselves, or from private companies set up among various practices. Grants are available from the government to run after hours care.

Hospitals come in all flavors. In 2011 about 55% were public, 23% were private day hospitals, and 21% were other types of private hospitals. Private hospitals come in both non-profit and for-profit types. Docs that work in public hospitals are usually salaried, although they can work in other reimbursement settings when seeing private patients. Long-term care is mostly provided by families with some people getting subsidies to help with the expenses. Some homes or care centers are available for those who are very dependent on assistance. Support is both means tested and dependence tested. The majority of long-term care facilities are non-profit. About a third a private, for-profit, and about 10% are run by the government.


Quality is generally measured and reported on by the Australian Commission on Safety and Quality in Healthcare. About 85% of general practices are credited against standards. And, as I mentioned before, pay for performance systems are in place to encourage better care. Some healthcare organizations and professional boards also have quality improvement programs. All citizens and permanent residents can get a personally controlled electronic health record if they want it. A fairly large amount of infrastructure exists to make such records interoperable at many facilities across the continent. Costs are controlled in a number of ways. The market uses generic drugs to keep pharmaceutical spending down. Almost all brand-name drugs are bulk purchased by the government which can also control pricing. New drugs have to prove their cost effectiveness before they're bought. Public spending is under global budgets, but as with some other countries, this can lead to increased wait times for elective things. There are also broadly negotiated fees for many services.


The knocks against the system will be familiar to those who are familiar with the series. Australia is worried about a shortage of professionals, but who isn't? In terms of quality, Australia sometimes comes behind some other countries we've discussed, but certainly beats others - like the US. The private overlay makes some people very concerned by a two-tiered system of care. It's interesting though that only about half of people opt for private insurance. Australia also has a disparities problem, with many indigenous populations having lower quality outcomes and poor health than other citizens. But, life expectancy is high, infant mortality is low, obesity is extremely low, and preventable deaths are rarer than in a lot of other countries. And Australia does it for a reasonably small amount of money.


In summary, Australia has a pretty robust healthcare system, with a private overlay that half of people use for better access and services. If that sounds familiar, it's 'cause it's a lot like other systems we've talked about, including France.