France Fights Universal Care's High Cost - WSJ.com
When Laure Cuccarolo went into early labor on a recent Sunday night in a village in southern France, her only choice was to ask the local fire brigade to whisk her to a hospital 30 miles away. A closer one had been shuttered by cost cuts in France's universal health system.
Ms. Cuccarolo's little girl was born in a firetruck.
France claims it long ago achieved much of what today's U.S. health-care overhaul is seeking: It covers everyone, and provides what supporters say is high-quality care. But soaring costs are pushing the system into crisis. The result: As Congress fights over whether America should be more like France, the French government is trying to borrow U.S. tactics.French taxpayers fund a state health insurer, Assurance Maladie, proportionally to their income, and patients get treatment even if they can't pay for it. France spends 11% of national output on health services, compared with 17% in the U.S., and routinely outranks the U.S. in infant mortality and some other health measures.
The problem is that Assurance Maladie has been in the red since 1989. This year the annual shortfall is expected to reach 9.4 billion ($13.5 billion), and 15 billion in 2010, or roughly 10% of its budget.I picked out some of the important highlights but I encourage everyone to read the whole story.In the U.S., hospitals are paid for each individual procedure. This system, called fee-for-service, is suspected of contributing to runaway costs because it doesn't give hospitals an incentive to limit the number of tests or procedures.
Ironically, France is actually in the midst of shifting to a fee-for-service system for its state-run hospitals. The hope is that it will be easier for the government to track if the money is being spent efficiently, compared with the old system of simply giving hospitals an annual lump-sum payment.
Government health care ain't all it's cracked up to be.