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Efficiency Challenges in Public and Private Healthcare Systems

Feb 25, 2023 | 0 comments

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Feb 25, 2023 | Essays | 0 comments

The terms private and public are descriptive words used in healthcare systems. The private in healthcare means the process where the business, individuals and charitable organizations gets involved in while the public refers to the involvement of the government (Grover, 2007).

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The current healthcare system does not operate efficiently and this calls for improvement in the system to increase efficiency of the system. However, the efficiency of the system cannot be improved if there is no standard mechanism of measuring the efficiency and the probable actions that should be taken or put in place to improve it.

Measuring of the efficiency in the healthcare system is also challenging because of lack of standard framework to measure the efficiency, technical issues which have not been resolved and notable differences to data access (Long, 1998).

According to (Grover, 2007), for the healthcare to perform highly, efficiency is one the factors that need to be employed. Inefficiency in the healthcare system is manifested in different dimensions. For example, the spending in the healthcare has little impact on the outcome of the beneficiaries. Furthermore, high cost for healthcare is also evidenced in some places and satisfaction of the patient or health improvement is minimal nowadays.

Moreover, it is evidenced in many hospitals that some costly physicians produce low quality services and the low priced physicians produce the highest quality of services (Long, 1998). This calls for ways to measure the efficiency of the healthcare system. However, it is challenging to measure the efficiency of the healthcare because there is limited scientific evidence on the authenticity and validity of the measuring criteria. In addition, the implication of the reporting the efficiency measures to the public can be detrimental. According to United States, & United States. (2002) it is challenging to define the healthcare efficiency because of the following reasons:

  • The relative nature of the term efficiency. There is a great influence on the perspective of the healthcare delivery elements .Furthermore; definition of the efficiency is different by payers, purchasers, consumers, plans and consumers.
  • All these category of people have different perspective on what forms and constitutes appropriate cost and quality.
  • Efficiency also comes in different types. These include productive, technical and social efficiency. Productive and technical efficiency cannot be described alongside social efficiency. Moreover, some efficiency types are viewed as contradicting the healthcare practitioner’s values. For instance, the perception of the physicians of their obligation as a priority over the needs of the individuals in the society.
  • Lack of a true definition of efficiency. There is lack of evidence to certainly assert how many and what healthcare services input will produce the best efficiency with what kind of benefits and risks.
  • The rewards such as financial are often not associated with the actual outcome of the healthcare. For example, the patients pay for the healthcare which can be measured in monetary terms or visits to the hospital. However, the outcome of the healthcare is not factor in the purchasing equation.

In comparison of the healthcare of the United States with other industrialized countries we find some similarities and differences. For example united states spend highest on the healthcare in relation to her gross domestic product (GDP) than any other country. For instance, in the year 2010 alone united states spent 17.9% of her GDP on healthcare. This translated to $8402 per person (Grover, 2007).

According to United States, & United States. (2002), the most trusted organization to source data for comparison of healthcare among the industrialized nations is the Organization for Economic Co-operation and Development (OECD). This organization’s journal documents the inefficiency of the US healthcare system in relation to other countries. These inefficiencies are evidenced by the way US conducts its operations for example the manner in which they counts the number of live births. Although the efficiency of the healthcare cannot be measured, OECD derives the statistics from the observable measures as health status proxies to provide comparative analyzed results. However, the reality which is depressing is that the observable realities are just mortality derivatives. Three statistics of the OECD in which they use to base their analysis in its report includes the life expectancy, infant mortality and the premature death.

There has been growing discontent among the populations in United States over their expenditures on healthcare and access to necessary services which is inverse. This is in sharp contrast with other industrialized nation which has a universal decent medical care access at a cheap cost compared to United States (Long, 1998). The US escalating healthcare cost which is  lined to exclusively the healthcare organization system, delivery and funding which has gone through a process of evolution in United states.

Furthermore, in comparing the healthcare systems of many industrialized nations, there is no common feature amongst them. Every system is unique .However; According to Oandasan, I., & Canadian Health Services Research Foundation. (2005), the systems of the healthcare in many nations are struggling with the intense pressure of the aging persons, exponential increase in medical costs and over reliance on high tech procedures and solutions which are extremely expensive. Similarly, all the industrialized nations battle with the way to balance the three common and shared problems in the modern health care. These include cost, quality and access.

As discussed above, industrialized nations have made the decisions to employ different approaches to address their healthcare concerns. The paper will examine the systems of heath care in United States and Canada and try to make comparisons. In United States, the health care system is offered majorly through the private sectors while in Canada the system in place for administration of the health care is through provincial government system.


Canada employs the capitals economy which is similar to the economy of United States. Moreover, her healthcare system uses a system of free-for-service which is administered by the entities of the government (Oandasan, I., & Canadian Health Services Research Foundation, 2005). In this system, the coverage for the healthcare services is universal. Moreover, all the citizens of Canada are covered. The ten provinces of Canada administer and manage themselves but the differences are very few. The costs for the plan are mostly paid by the provincial government through premiums subscription and payment of taxes. Moreover, the government of Canada further funds the system by provision of additional funds to each provinces of Canada by grant systems and funds transfer generated and gotten through corporate income taxes and personal revenues. However, as much as the healthcare system in Canada is social and universal, the plan does not cater for drugs taken at homes, cosmetic surgery and the dental care (National Pharmaceuticals Policy, 2011).

About the hospital expenditures, those are regulated and determined by the central government. The doctors’ salaries are surrendered by the government according to the determination through negotiation between the doctor’s associations and the provincial governments (Grover, 2007).

The social healthcare system of Canada which is universal which ensures every Canadian citizen have access to healthcare also has its advantages and disadvantages. The main advantage which is conspicuous is that it ensures that healthcare coverage is universal. Moreover, despite the fact the health care cost is also rising in Canada, the cost of administration is appreciably lower because of the use of one payment source in each province (Long, 1998).

According to United States, & United States. (2002), the disadvantage of the system is that hospital expenditures control by the system has created a scenario whereby some forms of the latest technology such as the cardiac surgery have led to overflowing waiting lists and the patients face delays. Moreover, the physical conditions of some facilities in the hospitals have deteriorated because of insufficient funding to maintain them.

In comparing the health system of Canada, there are many differences which come out. According to Oandasan, I., & Canadian Health Services Research Foundation (2005), the data of 1989 stipulates that the healthcare expenditure per capita of united states was $2354 compared to Canada which had $1683.Moreover, the healthcare in united states took a budget of 11.8% of the gross domestic product of the country compared to Canada where it was 8.7% of the gross domestic product. It is important to note that the GDP of united stets is far much higher than that of Canada. Therefore, this shows that their expenditure was higher.

It is very difficult or close to impossible to compare how the health cares in a certain country in relation to the other. However, the simplest way to bring out the differences is by analyzing the statistics of the nation such as the infant mortality which are the deaths which occur in the first year of life, life expectancy and the prenatal mortality which are the deaths that occur within the seven days of birth (Grover, 2007). From the statistics, Canada has the highest life expectancy and the lowest percentage of infant mortality (Oandasan, I., & Canadian Health Services Research Foundation, 2005). This brings the conclusion that higher expenditure does not result to a better healthcare.


The Obamacare is a common term used to refer to The patient protection and Affordable Act (PPACA) which was signed by president Obama in 2010. The healthcare law has since received criticism and support alike since it was enacted, passed and signed into law (Tate, 2012)

The law has does the following things to the citizens of United States as discussed below. The main purpose which was stated since the formulation of the law was to increase the number of citizens of America covered by health insurance and reduce the healthcare cost. However, the most parts which people usually talks about in the Obamacare is that there will be no exclusion of anyone from getting insurance and everybody will have to obtain the insurance (Tate, 2012).

According to Tate, (2012), the companies of insurance cannot refuse to cover the citizens of America like they used to do before and furthermore they cannot revoke the insurance cover they had on the citizens of the America. Moreover, there will be no forcing of people to pay extra for the coverage because of the conditions which are pre existing. However, there will be a set limit on the amount the insurance companies can get profit legally and eventually they will have to cover all forms of preventive care. All these changes the Obamacare is introducing among others have the main aim of containing the health care spending of the United States which is skyrocketing (Tate, 2012).

Since the law was passed almost three years ago, from the outward analysis, it seems that that no significant change has taken place due to the introduction of the law. However, the law promises that most significant changes will be realized after the first ten years. However, some of the noticeable changes which have affected the insurance companies in the united states and the slowing down of the health care spending for the last three years (Tate, 2012).

However, the bone of contention in the law which has led to many disputes was the mandate of every individual that required most citizens of America to get a health insurance cover which is essential at least at minimal. Moreover, this is the part of the law that prompted ACA to file a case at the Supreme Court (Tate, 2012).

From the discussion of the Obamacare law, the pros has been identified and discussed clearly. However, the cons to the law are also discussed below. More than forty five million Americans do not have the health insurance. However, the law requires every citizen t have a minimal health cover by the year 2014 when the law will go into effect (Tate, 2012). What is the projected number that will have taken the health insurance by the year 2014?

The government of the states and the federal government have put in place exchanges that are expected to start in October. Exchanges are simply open markets where business which are medium or small and the people can shop for the insurance and also compare the benefits and prices. This will be done online on the web sites (Tate, 2012).

However, the big question is the affordability of the insurance covers. The government has subsidized it for the people with moderate source of income where they can get the money or discounts to help them in payment. However, the low income earners will get the Medicaid care.

According to Tate (2012), the conservatives have been upbeat because of the radical nature of the Obamacare law in transforming the health sector. Furthermore, they claim the system is costly to the many citizens of America in terms of the required minimal health insurance cover. In addition, the conservatives have opposed the law out of political reasons. It is political game of supremacy between the Republicans and the Democrats.


Grover, J. (2007). Healthcare. Detroit: Greenhaven Press.

Long, M. J. (1998). Health and healthcare in the United States. Chicago, Ill: Health Administration Press.

United States., & United States. (2002). Help Efficient, Accessible, Low Cost, Timely Healthcare (HEALTH) Act of 2002: Report together with dissenting views (to accompany H.R. 4600) (including cost estimate of the Congressional Budget Office). Washington, D.C: U.S. G.P.O.

Oandasan, I., & Canadian Health Services Research Foundation. (2005). Teamwork in healthcare: Promoting effective teamwork in healthcare in Canada : policy synthesis and recommendations. Ottawa, Ont: Canadian Health Services Research Foundation.

Healthcare reform, including: health care reform, medical cannabis, publicly funded health care, comparison of the health care systems in Canada and the United States, single-payer health care, the citadel (novel), national pharmaceuticals policy. (2011). S. l: Hephaestus Books.

Tate, N. (2012). ObamaCare survival guide.

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