NationalHealthSystemsasMarketInterventions

MILTON I. ROEMER

~ D

HE stuctureand functioningof nationalhealth systems

in the modern world are the result of long historical
i
2 developmentsin science and society. Advancesin scit
z ,
5 ence made possible countlesstechnologiesfor the prevention of disease and for its treatmentif prevention
failed. Changesin societyhave fosteredthe application
of many of these technologiesto the needs of people.
r

HEALTH

SYSTEM

EVOLUTION

From the earliesttimes, the provisionof healthservicewas regardedas a

matter of value, warranting some sort of compensation. Like commodities, health care was bought and sold in a market.When religious
groups realized that some people were too poor to pay for care they
obviouslyneeded,charitablehospitalswereestablished,andlaterdispensaries.This was marketinterventionthroughthe motives and resources
of religion.
As industrializationdeveloped,it was propelledby the profitincentives
of capitalism.Scienceadvanced,universitiesgrew,cities multiplied,and
a working class took shape. For workers,acute or chronicillnessmeant
a loss of livelihood, againstwhich sicknessinsurancecould be a protection. This was another marketinterventionby planned group action of
working people, leading eventuallyto social securityfor health care in
some 7o nations.
As doctors and other health care providersbecame more numerous,
governmentsrecognizedthe need for assuringtheircompetence.Specified
education became requiredfor a license to practice-constituting one
more strong interventionagainst free trade in the marketplace.
With vastly increased knowledge on prevention of disease, public
health agencies were organized;they renderedenvironmentaland personal health servicesthat could not be expected in the normal medical
market. To provide comprehensivehealth care efficiently,furthermore,
doctors and otherpersonnelin scoresof countrieswere broughttogether
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in teams stationedin healthcenters,as distinguishedfrom individual

practitioners
functioningas smallautonomousentrepreneurs.
Themorecomplexthatnationalhealthsystemsbecame,themorethey
structureof activitieswas organizedin
calledforplanning.A hierarchial
nearlyeverycountry.Conceptsof equity and social justicegradually
cameto replacea freemarketphilosophyin decisionson manyaspects
of nationalhealth systems.Fortyyears ago, a conservativecapitalist
power,the UnitedKingdom,transformedcomprehensive
healthservice
into a publicgood for everyone.Everyotherindustrialized
countryhas
beenmoving,slowlysometimes,inthesamedirection.Whilemarketplace
values,of course,arestill foundin healthsystems-more in some than
in others-the conceptof health serviceas a social right has gained
ascendancyin most countriesof the world.
MEANING

OF HEALTH

SYSTEMS

What then is a nationalhealthsystem?It is the complexof activities

intendedto resultin theprovisionof healthservices.A healthservice,in
turn,is an actionwhoseprimarypurposeis the protectionor improvementof health.Foodaffectshealth,asdoeshousing,clothing,orathletics,
buthealthimprovement
is not theirprimaryor principalpurpose.Many
featuresof livingand of society,of course,influencehealth-probably
even more than healthservices-as epidemiologistshave known for a
long time. On the otherhand,manyharmfuleffectsof the physicalor
social environmentcan be preventedor amelioratedby appropriate
healthservice.
of health,besideshealthservice,
Becauseof thecountlessdeterminants
the WorldHealthOrganization
emphasizesthe importanceof "intersectoral collaboration"in the driveto achieveHealthfor All. Numerous
sectors,suchas agriculture,industry,employment,housing,education,
even internationalrelations,have enormousimpactson health.Health
workers,therefore,mustattemptto influencepoliciesin allsocialsectors,
insofaras theyimpingedirectlyon health.(SeeFigureI.)
Evenwithinthe healthsectoror healthsystem(definedas the social
machineryproducinghealth services),the tasks are numerousand
difficult.Most nationalhealthsystems,at leastin theory,havebecome
motivatedby conceptsof socialjusticemoreprofoundlythanothersecor housing.Theimplementation
of principlesof
tors suchas agriculture
justice,however,maybe difficult.Weseetheproblemtodayin theincursion of for-profitinvestor-owned
corporationsintothefieldof hospitals,

FIGURE

Determinants
of Health
SOCIAL

PHYSICAL

ENVIRONMENT

ENVIRONMENT
Geography,Climate,
Food, Housing,Water,
etc.

Education,Occupation,
Income, Relationships,
Urbanization,etc.

I~

~STATUS
Age, Sex, Immunity,
Genetic Background,
etc.

POPULATION'S
PHYSICAL,MENTAL
and SOCIAL
WELL-BEING

HEALTHSERVICES
Health Promotion,Disease Prevention,
Treatment,Rehabilitation,etc.

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FIGURE 2

Modelof a NationalHealthSystem
to HealthStatus
Showingits Components& TheirRelationships

Mo

----------------------------------------------_-------__________________z
ORGANIZATIO

z~~~~~~~~~~~

long identifiedwith non-profitor publicsponsorship.The dependence

of mostcountries,especiallythe lessdevelopedones,on drugsproduced
by multinationalcorporationsearning high profits, causes serious
economicdifficulties.
Yes,evenwithinstrongnationalhealthsystems,the
dynamicsof variouscomponentactivitiesarecomplex.
I spoke of a healthsystemas "themachineryproducinghealthservices,"and in Figure2 I havetriedto show in a verysimplemodelhow
this machineryoperates.The "healthneeds"on the left arefed into the
5-partsystem,and the productemergingconstitutes"healthresults"
hopefullyimprovement.This is, of course,a greatoversimplification,
whichrequiresmorecarefulexplanation.
HEALTH

SYSTEM

COMPONENTS

A morecompleteportrayalof the componentpartsof a nationalhealth

systemis showninFigure3. Themostconspicuousfeatureof anynational
of programs"thatoccupiesthecentral
healthsystemis the "organization

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NationalHealthSystem:Components,Functions,andTheirInterdependence
MANAGEMENT
Planning
Administration
Regulation

RESOURCEPRODUCTION
Manpower
Facilities
Commodities (drugs,etc)
Knowledge

ORGANIZATION
OF PROGRAMS
Ministryof Health--alllevels
Other PublicAgencies
VoluntaryAgencies
Enterprises
Private Market

SERVICEPROVISION
PrimaryHealthPromotion
& Prevention
PrimaryCare--treatment
Secondary MedicalCare
TertiaryMedicalCare
Rehabilitation

ECONOMICSUPPORT
GovernmentalRevenues
Social Security
Insurance(Voluntary)
Charity
Personal Households
ForeignAid

conceptual box in this model. It is more logical, however,and I trustmore

lucid, if we start the analysis with the "production of resources,"and
then proceed through the steps that end with the provision of health
services.

Production of Resources
Essentialfor the operationof any health systemareseveralbasicresources
which somehow must be produced or obtained. The manner in which
these resourcesare acquireddiffersenormously among countries,but in
their simplestform they include (a) health manpower,(b) healthfacilities,
(c) commodities, such as drugs, and (d) knowledge. It may be noted that
financing or money is not regardedas a resource;it is rathera medium
of exchange, convertibleinto resourcesor services,as we will see.
The production of all resources requires inputs from various other
social sectors, such as education, construction, manufacturing,and so

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on. The quantityand qualityof resourcesin a healthsystemdepend

largely,butnot entirely,on thewealthof a country.Somerelativelypoor
countriesmay developabundanthealthresourcesbecauseof a political
will thatassignshighpriorityto the healthsystem.
Healthmanpowerincludesphysicians,pharmacists,nurses,dentists,
technicians,and scoresof othertypesof personnel.Withthe growthof
healthtechnologyand the expenditureof increasingsharesof national
wealthon healthsystems,the numbersand typesof healthmanpower
have expandedenormously.In the less developedcountries,traditional
healers(withor withoutsome formaltraining)stillplay significantbut
decliningroles.Almostall countrieshave also been makingincreasimg
use of a greatvarietyof medicalassistantsor communityhealthworkers-trained forrelativelybriefperiodsandworkingundersupervision
to extendprimaryhealthcareto populationsat relativelylow cost.
Healthfacilitiesarealso of manytypes.Historicallyoldestaregeneral
hospitalsfor treatmentof the seriouslysick, althoughtheir rangeof
functionshas steadilybroadened.Specialhospitalshavebeendeveloped
for the mentallyill, for leprosypatients,for maternityand women's
disorders,forchildren,forgeneralinfectiousdisease,formilitarypersonnel, andforotherspecialpurposes.Whilefoundedoriginallybyreligious
groups,an increasingproportionof hospitalshavebecomesponsoredby
unitsof govenment,by voluntarynonprofitorganizations,andevenby
The organizedfacilityfor ambulatoryhealthserprivateentrepreneurs.
vice is muchyoungerhistorically,but in recentdecadesit has acquired
increasingimportance.Inmostdevelopingcountries,in allsocialistcouncountries,the
tries, and in many industrializedand welfare-oriented
healthcenteror polyclinichasbecomethe conventionalsettingformodernambulatoryservice.
Amonghealthcommoditiesrequiredin everyhealthsystem,drugsand
vaccinesare crucial.Overthe centuries,drugsderivedfrom naturemainly from plants or animals-have graduallybecome replacedby
companies,often
chemicallysynthesizedproducts.Largepharmaceutical
linkedto the chemicalindustry,havecometo dominatethe field.These
firms,basedin a few countries,areresponsiblefor most of the drugsin
the developingworld-both those sold in pharmaciesand those dispensedin hospitalsandhealthcenters.Becauseimporteddrugsarecostly,
drug expendituresmay absorb 30 percentor more of a Ministryof
Health'sbudget.Thedynamicsof medicalsuppliesandmodemdiagnostic andtherapeuticequipmentaresimilar.

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Knowledge,the fourthresource,is producedby observationandresearch.The knowledgeof thepast,of course,is recordedin books,and

mostnew knowledgeis reportedin journalsor at conferences.
Unfortunatelynew knowledgeis often communicated
slowly,especiallyin developingcountriesand in the ruralareasof all countries.Evenwhen
knowledgeis available,its applicationin practicemay be retardedby
in otheraspectsof healthsystems.
deficiencies
Organization
of Programs
Inorderto mobilizetheseveraltypesof resources
to achievecertainends,
they are typicallyorganizedinto programs.As governments
have asfor the generaloperationof healthsyssumedincreasingresponsibility
tems,the majorpublicagencyto play this rolehas beena Ministryof
Healthor somebroaderbodyencompassing
sucha ministry.
Theinitial
functionsof the Ministryof Healthwere usuallyto assurea sanitary
environment
andcarryout otherpreventive
activities.IntimeMinistries
havecome to operatefacilitiesfor medicalcare,to trainpersonnel,to
formulateandenforcetechnicalstandards,
to do epidemiological
surveillance, and to provideother forms of supervisionof healthservices
throughouta system.
In most countries,the geographyand populationrequire,for sound
the subdivisionof the territoryintoprovincesor states,
administration,
andthesein turnintodistrictsor counties.Thebasicformof government
in one country,suchas Canada,mayendoweachprovinceor statewith
greatautonomy;in anothercountryauthoritymaybehighlycentralized;
and in a thirdcountryone mayfinda balancebetweencentralized
and
of power,mostHealth
decentralized
powers.Whateverthe distribution
Ministriesseemto be tryingto maximizethe involvementof local authoritiesin healthprograms,whilealso maintaining
at the top uniform
nationalpoliciesandstandards.
Numerousothergovernmental
agenciesplayrolesin nationalhealth
systems.Ministriesof educationare usuallyresponsiblefor training
physiciansandcertainotherpersonnel.Socialsecurityprograms,including healthinsurance,maybe directedby a specialministryor be within
suchas laboror socialwelfare.Ministriesof laborlook
anotherministry,
Theremaybespecial
afteroccupational
safetyandhealthatworkplaces.
authoritiesfor publicworks,socialwelfare,environmental
protection,
-all of whicharerelevantto certainaspectsof
and for the "interior"

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health.Themilitaryestablishment
of almosteverycountrymaintainsits
own medicalservice.
Stillotherorganizedprogramsfunctionoutsideof government-usually for quitefocusedpurposes.Voluntarynonprofitagenciesmay concentratetheireffortson certaindiseases,suchas tuberculosisor cancer;
on certainpopulationgroups,suchas childrenor the elderly;on certain
services,suchas bloodbanksor homenursing.Voluntaryagenciesmay
also operatehealth insuranceprograms.Associationsof professional
theirmembersin negotiationswithgovernment
personneloftenrepresent
andtheymonitorethicalbehavior.
Stillanotherformof non-governmental
agencywitha roleinthehealth
systemis the industrialenterprisethat provideshealthservicesfor its
workersandsometimestheirfamilies.Whatevermaybe the motive-to
discourageunionizapromotea healthyworkforce,to paternalistically
tion, or to reducethe insurancecosts of worker'scompensationfor
industrialinjuries-such servicesarerelevantin a healthsystem.
Finally,the entireprivatemarket,in which medicalcare,drugs,and
otherhealthservicesareprovided,mustbeconsideredpartof thiscompoin theusualsense,private
nentof healthsystems.Whilenot "organized"
servicesareboughtand sold througha processgovernedby supplyand
demand,price, and some degreeof competition.The strengthof the
privatemarketin a healthsystemtendsto be reciprocalto thatof public
programs;if Ministriesof Healthandotherorganizedagenciesareweak,
the privatemarketis usuallystrong,andviceversa.
EconomicSupport
Supportingthe developmentof all healthresources,theirorganization
into programs,and ultimatelythe provisionof services,requiresevery
nationalhealthsystemto have sourcesof economicsupport.To some
extentin everycountry,privateindividualsfinancehealthservices,typidonations
callyforthetreatmentof personalhealthproblems.Charitable
areanothersourceof support,and thesemaytakethe formof donated
or voluntaryhealthinsurance
laboras wellas money.Non-governmental
is anothersourceof greatimportancein certaincountries.
of course,generaltaxationis a sourceof economic
Undergovernment,
supportfor the healthsystemin all countries.The exacttypesof taxation-on land, on income,on purchases,on selectedproducts(e.g.,alcohol and tobacco)-vary widelyin theiruse for healthpurposes.The

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politicallevels(national,provincial,local)at whichthey arecollected,

alsovaryin theirrelativeimportance.
Everywhere
tax revenuesareused
for generalprevention,andin mostcountriesalsoforhealthmanpower
training,for facilityconstruction,for medicalcareof the poor,andfor
manyotherhealthpurposes.WithexceptionsincertainAfricancountries
anda few others,thepercentof all nationalhealthexpenditures
derived
frompublicrevenueshas beenrising.This has contributedto greater
sharesof total nationalwealth(grossnationalproductor GNP)being
devotedto thehealthsector.
Mandatoryinsurance
orsocialsecurityis a specialformof government
strategycontributing
moneyto healthsystemsupportin about70 countries.Thismethodestablishesoneor moreearmarked
funds,whichmay
only be used for financingthe healthcareof personswho havemade
paymentsand, usually,theirfamilies.Becauseof theirseparatestatus,
socialsecutityfundsdo notusuallyrequireparliamentary
orgovernmental decisionfor theiruse, nor do theycompetewith otherprogramsof
government
dependingon generalrevenues.SocialSecuritymaybe conceived as organizedself-helpby workersand employers.For these
reasons,the use of socialsecurityfundsfor healthpurposeshas been
politicallyattractiveand has steadilybroadenedoverthe last century,
protectinglargerproportionsof nationalpopulationsfor a widerrange
of healthservices.
In manycountries,stillanotherformof economicsupportforhealth
systems-often for hospitalconstructionand operation-comesfrom
attractsmoneydisproporpubliclotteries.Thisgamblingunfortunately
tionatelyfromlow-incomepeoplewho can leastaffordto spendit. A
finalsourceof healthsystemsupportis foreignaid,goingto developing
countriesfrom internationalagenciesor from certainaffluentindustrializedcountries;as a percentage
of thecostsof nationalhealthsystems
in developingcountries,thesefundsareseldomverylarge-usuallywell
under5 percent.
Therelativeproportionsof theseseveralsourcesof economicsupport
influencehealthsystempoliciesin manycrucialways. Supportfrom
privateindividualsobviouslychannelsresources,programsandservices
to thosewho havethe moneyto spend,muchmorethanto thosewith
the
thegreatesthealthneeds.Fortunately
forhealthsystemdevelopment,
shareof nationalwealth(GNP)beingdevotedto allhealthpurposeshas
it hasbeen
beenrisingin almostall countries.Overthelasthalf-century,
expandingin developingcountriesfromz or 3 percentto 4 or 5 percent;

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in developed countriesit has risen from 4 or 5 percentto 8 or iO percent

(in the United States to i i percent). Within those health expenditures,
the proportion derivedfrom governmentand other collectivizedsources
has also been increasing, implying an extension of principles of health
equity. Even though private-marketspending has risen in the last few
years, the long-termtrend has clearly been toward the public side.

Management
A second form of support for the operationof a health systemis management, which is meant to include several forms of social control-planning, administration,regulation,and legislation.Each of these processes
may be carried out with different degrees of rigor in various health
programs. All four of them are operative to some extent in programs
under both public and private auspices.
Planningmay be done at centralor local levels of health systems or at
both levelswith respectto differentfunctions. It appliesmost often to the
production of resources,but may also be applied to the developmentof
organized health programs or the provision of specificservices.In many
ways, planning may be used to influencethe performanceof the private
medical market.
Administrationencompassesmany functions -the exerciseof authority, organization of resources, delegation of responsibility,supervision,
communications,coordination,and evaluation.Sometimesthe term "administration"is used interchangeablywith "management,"but-whatever the terminology-the purpose is to mobilize human and physical
resourcesto reach a goal with maximum efficiencyand effectiveness.
Regulation involves the enforcement of certain standards of performance. It may apply in an organizedprogram, but is used more often to
monitor and control performancein the open market. Much regulation
is by government-for example, surveillanceover the method of manufacturing drugs by a pharmaceutical company. It may also be nongovernmental, such as the regulation of physicians' services by the organized medical staff of a voluntary hospital. Despite much political
rhetoricto the contrary,abuses in the free marketof health care have led
to increasingtypes of regulationin most health systems.
Legislationis the instrumentof governmentused for crystallizingand
clarifying health policy, so that it may become known to everyone.
Whether a country is ruled by a parliamentarygovernment, a military
dictatorship,or some other political structure,variouslaws may be estab-

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lishedto governthehealthsystem.Theselawsmayfacilitatetheproduction of resources,authorizevariousprograms,providefor socialfinancing of healthservices,controlthe qualityof performance

of healthcare
providers,or prohibitbehaviorinjuriousto health.
Provisionof Services
Operationof thefourcomponentsof a healthsystemjustdescribed
leads
to the finalcomponent:provisionof healthservicesto people.Thisincludesall formsof service-healthpromotion,diseaseprevention,
diagnosis,treatment,and rehabilitation.
In termsof the complexityof the
specificactivity,the servicesmay be designatedas primary,secondary,
andtertiary.
The typesof personnel,facilities,worksettings,andpatient-provider
relationships
differsubstantially
amongthe healthsystemsof countries.
Theydifferalso amongvariousprogramsin one country.A healthprogramaddressedto poor peopleusuallyprovidesservicesin a manner
quitedifferentfromconditionsin a freeprivatemarketservingthe affluent.Healthservicesfor militaryestablishments
areprovidedthrough
in allcountries.InLatinAmericancounhighlyorganizedarrangements
trieswith SocialSecurityprograms,coveringperhapszo or 30 percent
of theirpopulation,the insuredworkersaretypicallyprovidedservices
of higherqualitythan other personsservedby Ministryof Health
facilities.
Primaryhealthcare,accordingto WHO(WorldHealthOrganization)
principles,includesa wide rangeof preventiveservices,alongwith the
treatmentof uncomplicated,
commonailments.WHO doesnot intend
to haveits restricted
"care"l
SincetheAlmaAta
meaningof "treatment."
Conferenceon PrimaryHealthCarein 1978, almostall nationshave
adoptedWHO'sconceptof primaryhealthcare(PHC)-to embraceall
basicstrategiesof healthpromotionanddiseaseprevention.
Thepersonnel andsettingforprovidingPHC,of course,differgreatlyamongcountries.

butI believeit should

Secondarycarehas beenvariouslyinterpreted,
includespecializedmedicalservicesto theambulatory
patient,relatively
commonplacehospitalcare,non-medicalspecialistcare(suchas physiotherapyor prescribingeyeglasses),and low-intensitylong-termcare.
Tertiarycare refersto servicesrequiringhighlyspecializedskills and
sophisticatedtechnology,typicallyin a teachinghospital.Finally,rehabili-

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tationcan provideservicesthat help the disabledpatientto returnto a

sociallyindependentlife.
Healthservicesfor certainpopulations,suchas aborigines,or certain
illnesses,suchas mentaldisorders,areoftenprovidedunderquiteseparatearrangements.
Healthresourcesandmethodsof programorganization are usuallyquite differentfrom circumstancesin the rest of the
system. Typicallythese servicesare more highly organized,publicly
financed,andmanagedin a mannerorientedto thespecialcircumstances.
*>

This completesour analysisof the structureandfunctionsof a national

health system.We should now considerbrieflythe differenttypes of
systemthat operatein the world.Amongthe approximatelyi6 countrieson earth,no two systemsareexactlyalike,butone can understand
thembetterby clusteringthe systemsinto certainmajortypes.
DETERMINANTS

AND TYPES

OF HEALTH

SYSTEMS

Thecombinedcharacteristics
of all fivehealthsystemcomponentsdefine
the type of healthsystemfound in each country.The determinantsof
thesecharacteristics
mustbe soughtin past history,geography,culture,
andothersocialconditions.Examinedtoday,however,thehealthsystem
can be identifiedquitewell by two socialfeatures-economicandpolitical.Moreprecisely,thesystemis shapedbythewealthor economiclevel
of thecountryandbythepoliticalideologygoverningitshealthsystem.
The economiclevelsof countriescan be quitereadilyscaledin terms
of theirgrossnationalproduct(GNP)percapita.TheGNPindextellsus
nothingaboutthe distributionof incomein a country,but this, in fact,
is dependenton politicalideology,whichis a separatequestion.Countries
withrelativelyhighGNPspercapitaare,of course,mainlyindustrialized,
and thosewith low per capitaGNPsaremainlyagricultural.
Deviation
fromthisrelationship
hasoccurredin severalpetroleum-exporting
countries,which currentlyhave relativelyhigh GNPswithoutbeingindustrialized.
Thepoliticalideologyof a healthsystemcan be scaledalonganother
axis, yieldinga matrixof systemsportrayedin Figure4. The scalingof
this dimensionis not so readilyachievedas that of the economiclevel,
but I believeit is validto baseit on the degreeof marketinterventionin
the operationof the healthsystem-ranging fromminimalto maximal.
Marketintervention
replaces,in effect,the "unseenhand"of freetrade

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FIGURE 4

Typesof NationalHealthSystems
ClassifiedBy EconomicLevel& HealthSystemPolicies
ECONOMIC
LEVEL

(MarketIntervention)
SYSTEMPOLICIES
HEALTH

(GNPper
Capita)
Entrepreneurial Welfare-Onented
Universal&
Socialist&
&Permissive
Comprehensive CentrallyPlanned
UnitedStates
Affluent&
Industnalized

West Germany
Canada

GreatBritain
New Zealand

Japan

Norway

~~~~~2

Developing&
Transitional

Thailand
Philippines
SouthAfrica

Brazil
Egypt
Malaysia

VeryPoor

Ghana
Bangladesh
Nepal

India
Burma

9
Gabon

Barbados
Nicaragua

Cuba
NorthKorea

Sn Lanka
Tanzania

10

Soviet Union
Czechoslovakia

8
China

11

12

Kuwait
SaudiArabia

Libya

ResourceRich
13

14

15

16

and competition with planning; it replaces individual purchases with

group financing;it replacesisolatedvendorswith teams of providers;and
so on. In a word, it replacesentrepreneurialautonomywith social organization, and this may occur to varyingdegrees.
Even with the relativelysimple classificationsused in Figure4, the i 6
conceptual cells may be sufficientlydistinctto clarifyhow the main types
of health system work. In all but one of the I 6 cells the names of various
(3 I) countriesare given, simply as examples. If everycountryin the world

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wereplacedin one or anothercell, some cellswould doubtlesscontain

manycountriesandothersonlya few.Moreover,thecountriesin various
cellswouldchangefromyearto year,as economicandpoliticalinfluences
modifiedtheirhealthsystems.
To explorethe matrixin Figure4 somewhatfurther,we mayconsider
simplythescalingalongeachdimension.Thus,economicallythetoprow
refersto countrieswith GNPsof $ ooo percapitaor moreperyear.The
secondrow refersto countrieswith annualGNPs per capitabetween
$ ooo and$5oo. Thethirdrowrefersto countrieswithunder$ oo GNP
countriesall haverelativelysmall
per capitaper year.The resource-rich
populationsandpercapitaGNPsof morethan$5,ooo or even$2o,ooo
peryear.
The gradationsalongthe politicaldimensioncannotbe so quantitacolunmrefersto countriesin which
tivelyprecise.The "Entrepreneurial"
most of the healthsystem,as reflectedin overallexpenditures,
operates
role in the systemis relatively
througha privatemarket.Government's
weak. In the secondcolumnfor "Welfare-oriented"
countries,market
interventionhas been substantialwith respectto the financingof the
system.Healthcarefor most,nearlyall,of thepeopleis a publicresponsibility.A privatemedicalmarketcontinues,however,andmuchgovernmentmoneyis spenton paymentsto privateproviders.
Inthethirdcolumnforcountrieswith "Universal
andComprehensive"
health systems,governmenthas intervenedin the marketeven more
extensively.Boththe financingandthe provisionof healthserviceshave
becomehighlyorganized.The total populationhas becomeentitledto
virtuallycompletehealthserviceas a civicright at leastto theextentof
availableresources.The fourthcolumnfor socialistcountriesrefersto
healthsystemswhichhavebeenalmostcompletelyremovedfrommarket
hasbecomeresponsibleforallhealthservices;all
dynamics.Government
health resources,physicaland human,have come undergovernment
control.Privatebuyingandsellingof healthcarehasnot beenprohibited,
andit exists,but to a verysmalldegree.
TRENDS

Thesecommentson the majortypesof healthsystemin the worldare

There are some exceptions to any
inevitably over-simplifications.
generalization,and yet the matrix may help to put some orderinto
numerousnationalhealthsystemsthatotherwiseappearlike a jungle.
Of course,no healthsystemis static;everysystemis continuallychang-

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ing.Thisis in responsenotonlyto economicandpoliticalforces,butalso

to changesin the demographyof the population,the capabilitiesof
of peoplein publicafincreasedinvolvement
technology,urbanization,
fairs,andmanyothersocialcircumstances.
Theeffectof thesepressures
is to drivevirtuallyallhealthsystemsin thedirectionof greaterorganization.Thisappliesto all fivecomponentsof healthsystemstructure.
With mountinggovernmentsupport,the productionof healthresources-manpower,facilities,andknowledge-is expanding.Ratiosto
populationof hospitalbeds,doctors,nurses,andothersarerising.The
productionof drugsbyprivateindustryis increasing
dueto strengthened
economicsupportto purchasethem,eventhoughthissupportis mainly
frompublicsources.
Organizedprogramsaregrowingunderbothpublicandprivateauspices.Economicsupportis becomingmorecollectivized,
mainlythrough
governmentrevenues,but in some countries(France,WestGermany,
LatinAmerica,MiddleEast,Japan,SouthKorea,Philippines,
etc.)largely
throughsocialinsurance.Privatespendingis also increasingin certain
countries,bothdevelopedanddeveloping.
Managementis certainlybecomingmoresophisticated,
especiallyin
planning,regulation,andlegislation.Theprovisionof servicesin nearly
all countriesis shiftingfrom solo practitioners
to organizedteamsof
healthpersonnel,workingusuallyin clinicsor healthcenters,as wellas
in hospitals.
and
Somepeoplefearthat all this organizationyieldsimpersonality
insensitivityto the feelingsand needsof eachperson.Bureaucracy
is,
indeed,a hazardof any largeorganization.The benefits,however,in
accessibilityto healthcare,in qualityassurance,in economy,and in
equity are of overridingimportance.The increasingorganizationof
healthsystemsis helpingmorepeopleto obtainthosebenefits.Thechalthepersonalinterests
lengeis to achieveHealthforAllwithoutsacrificing
of anyhumanbeing.
Thispaperis basedon a Rosenstadt
Acknowledgment:
Lecture,
presented
atthe
of Toronto(Toronto,Ontario,Canada),MarchI 5, I98 8.
University
ABSTRACT
Nationalhealthsystemshavedevelopedinallcountries;
theirfeatureshavebeen
in the freemarketof healthservice.
shapedlargelyby organizedinterventions

ROEMER

* HEALTH

SYSTEMS

AS MARKET

INTERVENTIONS

77

throughanalysisof fivemajorcompoAnyhealthsystemcan be characterized

nents:(i) its productionof resources,(2) organizationof programs(including
a residualprivatemarket),(3) sourcesof economicsupport,(4) modesof management,and (5) patternsof providingservices.The diversetypes of health
systemsin the worldmay be categorizedin a matrixderivedfromtwo dimensions: (a) the economiclevel (foursteps),and (b) the politicalideologyof the
healthsystem,scaled(alsofoursteps)fromhighlyentrepreneurial
(minormarket
to socialist(nearlycompletemarketintervention).
Everynational
intervention)
healthsystemwouldfitintooneof the i6 cellsof thismatrix,althoughpositions
changeas a resultof economicandpoliticaldynamics.