the Five cs of universal Health care pHILIp musgrOve
tients; private insurance is legal but is not allowed for
services covered by the public insurance (although this
provision is under judicial challenge); and most providers are private and are paid under a fee schedule negotiated bet ween the government and the national medical
association. Private funding, both insurance and out-of-pocket, is substantial but limited to services not covered publicly and to amenities.
CHILE:
the Public-Private
insurance Model
Until 1973, Chile depended on its ministry of health to provide the only publicly financed health care, in public facilities. Patients paid the remainder out of pocket. The military dictatorship that took power that year per-mitted private health insurance to operate for the first
time. This did not change the degree of coverage but introduced a distinction both in financing and in the services to which people had access.
The higher-income groups could buy insurance individually from the Instituciones de Salud Previsional (
ISAPREs) or be covered through contracts between their
employers or other groupings and an insurer. Everyone
above the poverty level was required to pay 7 percent of
income either to the Fondo Nacional de Salud (FONASA)
for public coverage or to direct that tax contribution to
an ISAPRE. If the private premium cost more than the
tax, the client paid the difference out of pocket. Private
insurers could offer more amenities but could hold down
their costs by choosing not to pay for certain costly services and sending their clients to the public sector, which
was still legally obliged to serve them. Public facilities
could in principle charge the ISAPRE for that care but
seldom recovered much of the cost.
When democracy was restored in 1990, the ISAPRE
industry was too well entrenched politically and financially for the center-left government to shut it down and
Philip Musgrove is a health economist
and deputy editor of Health Affairs, a health
policy journal. He served 8 years at
the Pan American Health Organization
and 12 years at the World Bank.
return to public-only insurance. Instead, during the last
two decades Chile has sought to make universal coverage more complete and more equitable through reforms
that are also politically acceptable to the center-right.
This has meant supporting FONASA with part of the
revenue from income and other taxes, so that privately
insured people can then contribute to financing care
for those with lower capacity to pay. It has also meant
dividing the clients of FONASA into four classes according to income, with differences in which providers they
can consult and how much they contribute in co-pay-ments, but no difference in the services to which they
are entitled. And the ISAPREs are now required to pay
for all the same services as FONASA, even if care is provided in a public facility. Most recently, the government
has introduced explicit guarantees for care for certain
high-cost conditions under the Program of Acceso Universal de Garantías Explícitas (AUGE).
COLOMBIA:
“Contributory and
subsidized Regimes”
The Colombian health system in 1990 was the most complex of any in the “C” countries. It included a variety of social security schemes, numerous private insurers concentrated in the cities and among high-income clients, and a public system
that included municipal and departmental agencies as
well as a central ministry of health. Only about 25 percent of the population had any formal insurance coverage, and much of the rural population faced both physical
and financial barriers to getting care. Rather than trying
to unify these disparate elements, the government began to push for universal coverage by simplifying some
features while adding to the complexity in other ways.
In 1993, a new health law followed the adoption of a
new national constitution in 1991 that sought to guarantee certain rights, including the right to health care. The
new health law introduced two fundamental changes.
It distinguished a “contributory regime,” for those who
could afford a premium, from a subsidized regime for
those who could not, based on a means test, with the
former entitled to a wider range of services but a premium twice as high. It also provided for the national
government to pay the premium for all clients of the
subsidized regime, who were free to join any existing
insurance or any of the new insurance entities, either
