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August 24, 1994, Vol 272, No. 8 >
ARTICLE | August 24, 1994

Paying for Health Care FREE

Thomas Bodenheimer, MD, MPH; Kevin Grumbach, MD
[+] Author Affiliations

Edited by Drummond Rennie, MD, Deputy Editor (West), JAMA.

Address correspondence to San Francisco General Hospital, 1001 Potrero Ave, San Francisco, CA 94110 (Dr Grumbach).


JAMA. 1994;272(8):634-639. doi:10.1001/jama.1994.03520080076049
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References

At the center of the debate over health system reform in the United States lies the decision of how to pay for health care. Health care financing in the United States evolved to its current state as a series of social interventions. Each intervention solved a problem but in turn created its own problems requiring further intervention. In this article, we discuss the historical process of health care financing as solution-creating-new-problem-requiring-new-solution. The four basic modes of paying for health care are out-of-pocket payment, individual private insurance, employment-based group private insurance, and government financing. These four modes can be viewed both as an historical progression and as a categorization of current health care financing (Table).

Out-of-Pocket Payments  Fred Farmer broke his leg in 1892. His son ran 4 miles to get the doctor who came to the farm to splint the leg. Fred gave the doctor a couple of chickens to

REFERENCES

1 +
Levit KR, Lazenby HC, Levit KR, Cowan CA.  National health expenditures, 1991. Health Care Financing Rev . 1992;;14( (2) ):1-30.
2 +
Levit KR, Olin GL, Letsch SW.  American's health insurance coverage, 1980-91. Health Care Financing Rev . 1992;;14( (1) ):31-57.
3 +
Evans RG. Strained Mercy . Stoneham, Mass: Butterworths; 1984;.
4 +
Arrow KJ.  Uncertainty and the welfare economics of medical care. Am Econ Rev . 1963;;53:941-973.
5 +
Shapiro RY, Young JT.  The polls: medical care in the United States. Public Opinion Q . 1986;;50:418-428.
6 +
Starr P. The Social Transformation of American Medicine . New York, NY: Basic Books; 1982;.
7 +
Fein R. Medical Care, Medical Costs . Cambridge, Mass: Harvard University Press; 1986;.
8 +
Law SA. Blue Cross: What Went Wrong? New Haven, Conn: Yale University Press; 1974;.
9 +
Source Book of Health Insurance Data, 1990 . Washington, DC: Health Insurance Association of America; 1990;.
10 +
Reinhardt UE.  Reorganizing the financial flows in US health care. Health Aff (Millwood) . 1993;;12( (suppl) ):172-193.
11 +
Light DW.  The practice and ethics of risk-rated health insurance. JAMA . 1992;; 267:2503-2508.
12 +
Aaron HJ. Serious and Unstable Condition: Financing America's Health Care . Washington, DC: The Brookings Institution; 1991;.
13 +
Harris R. A Sacred Trust . New York, NY: The New American Library; 1966;.
14 +
Bodenheimer T, Grumbach K.  Financing universal health insurance: taxes, premiums, and the lessons of social insurance. J Health Polit Policy Law . 1992;;17:439-462.
15 +
Pechman JA. Who Paid the Taxes, 1966-85 . Washington, DC: The Brookings Institution; 1985;.
16 +
Cantor JC.  Expanding health insurance coverage: who will pay? J Health Polit Policy Law . 1990;;15:755-778.
17 +
US Dept of Health and Human Services. Health: United States, 1992 . Washington, DC: US Government Printing Office; 1993;.
18 +
Reinhardt UE.  Are mandated benefits the answer? Health Manage Q . 1988;;10: 10-14.
19 +
Butler SM.  A tax reform strategy to deal with the uninsured. JAMA . 1991;;265: 2541-2544.
20 +
Todd JS, Seekins SV, Krichbaum JA, Harvey LK.  Health Access America: strengthening the US health care system. JAMA . 1991;;265:2503-2506.
21 +
Himmelstein DU, Woolhandler S.  A national health program for the United States: a physicians' proposal. N Engl J Med . 1989;;320:102-108.
22 +
Bodenheimer T, Grumbach K. Understanding Health Policy: A Clinical Approach . Norwalk, Conn: Appleton and Lange; 1995;.

Figures

Tables

Interactive Graphics

Video

Country-Specific Mortality and Growth Failure in Infancy and Yound Children and Association With Material Stature

Use interactive graphics and maps to view and sort country-specific infant and early dhildhood mortality and growth failure data and their association with maternal

1 +
Levit KR, Lazenby HC, Levit KR, Cowan CA.  National health expenditures, 1991. Health Care Financing Rev . 1992;;14( (2) ):1-30.
2 +
Levit KR, Olin GL, Letsch SW.  American's health insurance coverage, 1980-91. Health Care Financing Rev . 1992;;14( (1) ):31-57.
3 +
Evans RG. Strained Mercy . Stoneham, Mass: Butterworths; 1984;.
4 +
Arrow KJ.  Uncertainty and the welfare economics of medical care. Am Econ Rev . 1963;;53:941-973.
5 +
Shapiro RY, Young JT.  The polls: medical care in the United States. Public Opinion Q . 1986;;50:418-428.
6 +
Starr P. The Social Transformation of American Medicine . New York, NY: Basic Books; 1982;.
7 +
Fein R. Medical Care, Medical Costs . Cambridge, Mass: Harvard University Press; 1986;.
8 +
Law SA. Blue Cross: What Went Wrong? New Haven, Conn: Yale University Press; 1974;.
9 +
Source Book of Health Insurance Data, 1990 . Washington, DC: Health Insurance Association of America; 1990;.
10 +
Reinhardt UE.  Reorganizing the financial flows in US health care. Health Aff (Millwood) . 1993;;12( (suppl) ):172-193.
11 +
Light DW.  The practice and ethics of risk-rated health insurance. JAMA . 1992;; 267:2503-2508.
12 +
Aaron HJ. Serious and Unstable Condition: Financing America's Health Care . Washington, DC: The Brookings Institution; 1991;.
13 +
Harris R. A Sacred Trust . New York, NY: The New American Library; 1966;.
14 +
Bodenheimer T, Grumbach K.  Financing universal health insurance: taxes, premiums, and the lessons of social insurance. J Health Polit Policy Law . 1992;;17:439-462.
15 +
Pechman JA. Who Paid the Taxes, 1966-85 . Washington, DC: The Brookings Institution; 1985;.
16 +
Cantor JC.  Expanding health insurance coverage: who will pay? J Health Polit Policy Law . 1990;;15:755-778.
17 +
US Dept of Health and Human Services. Health: United States, 1992 . Washington, DC: US Government Printing Office; 1993;.
18 +
Reinhardt UE.  Are mandated benefits the answer? Health Manage Q . 1988;;10: 10-14.
19 +
Butler SM.  A tax reform strategy to deal with the uninsured. JAMA . 1991;;265: 2541-2544.
20 +
Todd JS, Seekins SV, Krichbaum JA, Harvey LK.  Health Access America: strengthening the US health care system. JAMA . 1991;;265:2503-2506.
21 +
Himmelstein DU, Woolhandler S.  A national health program for the United States: a physicians' proposal. N Engl J Med . 1989;;320:102-108.
22 +
Bodenheimer T, Grumbach K. Understanding Health Policy: A Clinical Approach . Norwalk, Conn: Appleton and Lange; 1995;.

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