Over the past 100 years the provision of health care, or medical services, has become the financial responsibility of the state in every modern industrialized society except the United States. In most of Western Europe this responsibility is discharged by state-run insurance systems financed by taxes on both employers and workers and by moneys from general tax revenues. In Great Britain the payments are made almost entirely out of general revenues. In all these countries the state provides some medical resources as well, guaranteeing each eligible citizen access to medical care. In the socialist countries of Eastern Europe the government is usually the employer of health workers, and it delivers medical care through state-organized, and often state-operated, facilities. In the United States, despite nearly 80 years of agitation and effort, the federal government has accepted only limited responsibility for medical care, and there is as yet no national system. From the beginnings of the nation's history, Americans have valued self-help and have despised dependence. When private interests developed a profitable stake in the U.S. health-care system--either as insurers or purveyors--they reinforced the reluctance of U.S. citizens to admit the government into what was perceived as a private matter. The inability of millions of citizens to pay for even minimal levels of care, however, forced the government to intervene. Today the U.S. medical-care system is a complex mix of public and private payments, is enormously costly, and is characterized by a maldistribution of resources and serious inequities of access. THE U.S. SYSTEM The U.S. medical-care system is the country's largest employer: 9 million people work in the field. Of these, 597,000 are physicians (including doctors of osteopathy); 1.8 million are registered nurses, and 137,000 are dentists. There are just over 6,000 short-term stay hospitals, with over 1 million beds; 500 long-term hospitals with 200,000 beds; as well as about 20,000 nursing homes with nearly 2 million beds. The distinguishing feature of the system is its entrepreneurial nature. Physicians tend to be private practitioners (although 30% of practicing physicians are now full- or part-time members of health maintenance organizations or HMOs). Pharmacies are profit-making, often independent shops. Manufacturers of pharmaceuticals, medical equipment, supplies, and appliances are all in the private profit-making sector. "Voluntary" hospitals, on the other hand--such as community-run hospitals providing short-term care--are nonprofit. Only 10 percent of the total number of hospital beds are in "proprietary" (for profit) hospitals (although some 650 of the nation's 5,900 community hospitals are now run for profit by investor-owned corporations). Long-term hospitals are often government units. Most psychiatric hospitals are run by the states. The federal government operates all veterans hospitals. To pay medical bills, the majority of the population relies on private health insurance, which on the average covers less than 40 percent of the costs. More than 30 million people over age 65, and 3 million others under age 65 who are considered totally disabled, are covered in the government-financed program \TMedicare\t, some part of whose premiums they must pay. Another 25 million receive medical care paid for by \TMedicaid\t, the government-financed program for the "medically indigent." About 13 percent of the population, or 34 million people, are left without any coverage; they cannot purchase private insurance, and are not eligible for government programs. The government does not guarantee receipt of care, even to those eligible for medical services. Everyone is expected to make his or her own arrangements when sick. Government Health Agencies The Department of Health and Human Services is responsible for administering federal health-care activities. It advises Congress and the president on legislative measures and carries out congressional mandates in the health-care field. The Public Health Service (see \Tpublic health\t) is charged with dealing with health matters affecting the lives of U.S. citizens across state boundaries. It carries out epidemiological investigations (the \TCenters for Disease Control\t) and research (the \TNational Institutes of Health\t); is responsible for medical care for American Indians; and, to some extent, funds and stimulates the development of such facilities as neighborhood health centers and migrant health services. Through its subsidiary agency, the \TFood and Drug Administration\t, the Department of Health and Human Services is also charged with controlling and licensing medications (see \THealth and Human Services\t, \Tdepartment\t OF). State and local health departments license and certify health and medical care personnel and institutions and provide some preventive services (in-school vaccination programs, for example) for those unable to purchase them. Health Insurance Health insurance comprises all forms of insurance against financial loss resulting from illness or injury. Depending on the type of insurance, these losses may include the expenses of hospitalization, surgery, and other medical services. In 1989 private health insurance was a $185 billion business. A sizable amount of U.S. medical insurance is sold by the nationally organized, privately operated, nonprofit plans known as \TBlue Cross\t and \TBlue Shield\t. Commercial insurance companies sell various types of medical policies. Both the nonprofit and the commercial programs offer essentially the same types of coverage, which are divided into four categories: hospitalization, surgery, regular medical expenses, and major medical expenses. Hospitalization insurance includes normal and necessary hospital expenses, such as the cost of the hospital room and meals, use of the operating room, X-ray and laboratory fees for tests done while the insured is in the hospital, and some medicines and supplies. Hospitalization benefits are usually limited to a total monetary amount or to a maximum number of days. Surgical insurance covers the cost of operations, up to certain limits that may change according to the city or state where surgery is performed. The limits are based on "customary" charges for various types of surgery within a region; thus insurance payments for an appendectomy will be higher in New York City than in Harrisburg, Pa., for example. The most common health insurance coverage is for hospital care, and usually covers physician services in the hospital as well. More expensive coverage will include out-of-hospital (office and home) medical care. Major-medical policies protect the insured against catastrophic charges, paying a total sum that ranges from $10,000 to, perhaps, $1,000,000, after the policyholder has paid an initial deductible amount. The policyholder must also pay a percentage (usually 20 percent) of all costs above the deductible amount. Doctors' charges are not always covered entirely by insurance, and patients usually have out-of-pocket expenses in addition, which can be very heavy. Fixed prepayment plans are a relatively new type of insurance, offered by organizations that operate their own health-care facilities or that have made arrangements with a hospital and other health-care purveyors within a city or a limited region. Such plans offer subscribers complete medical care in return for a fixed monthly fee. The physicians' group practices known as health maintenance organizations base their operations on fixed prepayment plans. An increasing number of employers now make such plans available to their employees. Health Costs and Payments Expenditures for health- and medical-care services in the United States have been rising steeply for well over a decade. In 1981, for example, total medical costs were $286 billion; by 1989 they had shot up to almost $600 billion. Of this total, physicians received about 20%, hospitals some 40%. The remainder was spent on private- and government-funded research, on construction and equipment purchases, public-health services, and other health-related expenditures. Private insurance covered about 50% of individual medical costs; federal and state governments spent close to $120 billion for reimbursement of Medicare and Medicaid costs. Insurance coverage is uneven. While most of the population is covered for most of the costs of hospital care, only about half are covered for significant parts of the costs of physicians' care. (A larger number have insurance for some of the costs of in-hospital surgical services.) There is far less insurance covering the costs of home care or of dental services, and practically none, on a private basis, for the costs of nursing-home care. Coverage for home care of the disabled or chronically ill is virtually nonexistent. Except for hospital insurance, most coverage is of the indemnity type, where a fixed sum is paid for a service. In the majority of instances this payment must be augmented by the patient. Thus the fact that an individual may be covered by insurance may not protect him or her against the heavy costs of serious illness. Physician Distribution Of the nearly 600,000 U.S. physicians, only 150,000 are engaged in primary patient care--family medicine, internal medicine, obstetrics, and pediatrics. The majority work in specialized fields, such s the surgical specialties, anesthesiology, or psychiatry. Physicians are scarce in the slums of big cities and in sparsely settled rural regions, and overabundant in the wealthier suburban areas--to the point where some metropolitan regions may have a physician-patient ratio of 1 to 500, and some rural regions may have only one physician for 2,000 people. Increasingly, physicians are choosing not to enter solo practice, because of the accumulated burden of debt acquired in the lengthy process of medical training and the cost of operating independent offices. Many more doctors are now working as salaried staff in hospitals, as members of group practices or corporate-sponsored medical-care firms, or for varied community or business clinics. Cost Inflation in Medical Care The uncontrolled inflation of cost in the medical-care system--double and sometimes triple the general inflation rate--has been ascribed to a number of factors. Increasing numbers of people now seek care, particularly growing numbers of older people. (Although people over 65 constitute only 13 percent of the population, they use over 25 percent of all medical services.) In addition, greater use of laboratory tests and X-ray examinations and of specialists in diagnosis and treatment has driven costs upward. The continuing flow of new, more advanced instruments--which are not only more expensive to buy but require trained operators and costly maintenance--adds even further to escalating medical expenditures, as do the growing number of tests ordered by doctors to protect themselves from malpractice suits. The \TAIDS\t epidemic presents a cost problem that neither private insurance firms nor government agencies have yet effectively confronted. At the end of the 1980s, over 126,000 \TAIDS\t cases had been reported, and it was estimated that at least 1 million more persons had been infected. Costs for the care of \TAIDS\t patients in the near-term future will therefore increase substantially and could, possibly, bring federal programs close to bankruptcy. The increased involvement of the government in paying for medical-care services means that more and more tax money must be appropriated for health-care costs, and the cost-inflation issue has become a chief target of federal legislation. While there is some evidence that the use of the medical-care system by the providers--principally doctors and hospital administrators--is less than efficient or not always appropriate, there is great reluctance to intervene with statutory requirements that would hamper the free exercise of professional judgment. The private nature of the physician-patient relationship--the "free choice" of a doctor, which is a sine qua non of the U.S. medical-care system--has made legislators reluctant to regulate or control the use of medical care by patients. Runaway medical inflation continues, and basic changes in the system to control or remedy defects do not appear to be imminent. Attempts to Reduce Health-Care Costs Hospitals are responding to increasing cost pressures in a number of ways. They have attempted to introduce more-efficient management methods and have joined forces with other hospitals to benefit from joint purchasing and interchange of staff. Proprietary hospitals, in particular, have found greater profits in chain operations: by 1983, for-profit, multihospital systems had built or acquired more than 1,000 hospital units. Many of these had been nonprofit, public facilities. In addition, one-third of the nation's nursing homes are now owned by corporations. Other efforts to reduce costs have involved hospital medical practice. Less-expensive professional workers (such as paramedics and nurse practitioners) have been used in the hope of getting necessary care to patients at a lower cost. On the other hand, "second opinions" on the necessity for hospitalization or surgery have been more effective in improving quality than in reducing costs. Hospital peer review, in which doctors reach judgments on the nature and length of hospital care provided by their colleagues, has had a similar effect. Health maintenance organizations operate on a budget that is the sum total of their patients' fees and therefore cannot afford to prescribe too-lengthy hospital stays or unnecessary surgery. Legislation passed in the 1970s provided financial incentives to encourage the formation of HMOs, in the hope that they would prove an effective means of holding costs down. In the late 1980s, 650 HMOs had enrolled 30 million people. Despite these various efforts, medical-care costs are still more than the economy can tolerate. In 1983, Medicare instituted a new hospital payment system in which each Medicare patient is classified, according to his or her illness, into one of 467 illness categories, and hospitals receive a preset sum for treatment, regardless of the actual number of "bed days" of care used by the patient. This novel method of payment provides an incentive to keep costs down, but it may also discourage the treatment of severely ill patients. HEALTH-CARE SYSTEMS IN EUROPEAN COUNTRIES Sweden offers all of its residents (including non-citizens) a complete range of health services that are financed out of employers' payroll fees and local income taxes. The patient, however, pays a nominal sum for each visit to a physician and for each prescription. (Free dental care is provided for all children; the system pays a percentage of the costs incurred by adults.) Some 10,000 physicians practice in Sweden. Of these only about 5 percent are in private practice. Hospitals and other health facilities are publicly owned by the 23 county councils and three large municipalities that constitute the Swedish system of local government. Swedish medical care is available to the entire population on an equal basis. The price is high, however--health care consumed 10 percent of the gross national product in 1983--and the tax burden on all Swedes is exceptionally heavy. In the British \TNational Health Service\t (NHS) nearly all facilities are publicly owned and managed through local or regional health authorities. Physician and hospital payments are taken from national funds, largely tax revenues. Every resident of Britain is entitled to medical care, and this feature distinguishes the NHS from other non-socialist European systems, which are insurance programs and serve only premium-paying clients. Although there is a small charge for prescribed medications, pharmaceutical costs have been kept relatively low because the Service negotiates bulk purchases from its suppliers and monitors prescribing practices. Britain has one of the lowest rates of surgery in the world (it is half that of the United States), but there are long delays in admission to hospital for elective surgery. Spending about 6 percent of the gross national product, the NHS has managed to maintain a much lower level of cost than other systems, but it pays a price in deteriorating facilities. At some point there will have to be a heavier investment in capital improvements. Other European countries repeat, in varying degrees, the government involvement of Britain and Sweden in the health-care system. In the \TUSSR\t, medical care is free for all citizens. The quality of care that most citizens receive, however, is said to be inadequate by Western standards, and--as also in Britain--the average patient may have to wait for nonemergency treatment. ISSUES AND POSSIBLE SOLUTIONS Few would disagree that, for those who can afford it, the U.S. health-care system offers medical technologies as advanced and treatments as effective as, if not better than, those anywhere in the world. In its piecemeal attempts to open the system to all who require its services, however, the United States has come face to face with its fundamental inequities and its uncontrollable cost. To its critics, the causes of the inadequacies are clear--the system is fragmented, the public and private sectors are unrelated and unconnected, and there is no national commitment to equity and no government responsibility for assuring equitable access to medical care. The results are rapid inflation of cost on the one hand and, on the other, profitability--rather than medical need--as the benchmark for distribution of services. A possible solution is the adoption of a national health-insurance system resembling those in other advanced industrialized countries. Although a rapid shift to a national health-care system is unlikely, demands grow for more equitable health-care access, effective cost controls, and eligibility standards for health-care programs that are uniform nationwide. Even before a national system is implemented, the nation must meet the following challenges. It must find ways of allowing medical-care access to all citizens and of improving the quality of care being delivered. It must develop acceptable ethical decisions on long-term care for sick or handicapped people of whatever age whose condition is pitiful or hopeless. It must adjust the service models of medical care in order to better provide needed services for the aged, young children, and the mentally afflicted. And it must increase and emphasize preventive services at all levels, including the national, to eliminate health hazards in the environment. In addition to the more obvious hazards (such as toxic chemicals), these would include the social and economic factors contributing to alcoholism, drug abuse, venereal disease, teenage pregnancy, and poor nutrition. \TGeorge\t A. \Tsilver\t, M.D. Bibliography: Anderson, O., Health Services in the U.S. (1985); Department of Health and Human Services, Health: United States, 1983 (1983); Feder, Judith, Holohan, John, and Marmor, Theodore, eds., National Health Insurance (1981); Fein, Rashi, Medical Care, Medical Costs: The Search for a Health Insurance Policy (1986); Fuchs, Victor, The Health Economy (1986); Gray, B., ed., The New Health Care for Profit (1983); Hiatt, Howard H., America's Health in the Balance (1987); Kleinman, Arthur, The Illness Narratives (1988); Luft, Harold, Health Maintenance Organizations (1981); Silver, George A., A Spy in the House of Medicine (1976); Starr, Paul, The Social Transformation of American Medicine and the Public Interest (1983); Stevens, Rosemary, American Medicine and the Public Interest (1971) and In Sickness and in Wealth (1989). See also: \Tmedicine\t; \Tnursing\t; \Tpharmaceutical industry\t.