Development and Finance from issue 2010/3

Tamás Novák - Erika Garaj

Health Care Reform as an Investment – The US Example

- Abstract -

JEL I-18


In European health care traditionally marked by numerous governmental functions, the role of the private sphere is increasing. There are fields where private property is stronger than in others: for example in dentistry, psychotherapy, long-term care for the elderly. In addition to the private providers, private property appears in many other examples: outsourcing the management of health care providers to private entities (e.g. the practice of German public hospitals), outsourcing or insourcing operations, and involving private capital in investments (private capital investments in NHS hospitals in the UK). The US reform continues to grant a major role to private insurers, while another actor has been introduced to the insurance market, namely the state, which will act directly and more intensively as a regulatory authority in the operation of health insurance markets in the next decade, and try to control the activities of companies and insurers alike by means of tax measures. Regrettably, Europe and the US are witnessing somewhat contrary processes in organising and regulating the health system and the health insurance market, even though it is clear that the new rules might push the future deficit up considerably and set a precedent for expanding health care even further, to even more expensive levels.

Tamás Novák, associate professor (Budapest Business School)
Erika Garaj, PhD, senior lecturer (SOTE University)

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