Country Profile: Belgium

Population 10,400,000

Government Federal parliamentary democracy

Health Care Model Bismarck

GDP 395B (2010 est.)

%GDP spent on health care 9.5

Per capita income $37,900

Health care expense per capita 3,563 (adj.)

Health care expense per capita normalized to income of 50K 4,700

Life expectancy (m/f) 77/82

Health life expectancy (m/f) 69/73

Overview

• Goals: Increasing access, ensuring quality of care, sustainability of system
• Universal access
• Choice of provider
• Broad set of benefits
• Mix of public and private funding
• Economic efficiency of delivery comparable to other European nations
• Regulated at national level
• Preventive care and health promotion delivered at regional and community levels

Structure

The Belgian health care system is organized around a "principle of solidarity" that recognizes no distinction between rich and poor, healthy and sick, with no selection of risk. Based on the Bismarck concept of social insurance, the system covers more than 99% of the Belgian population with more than 8000 services. Treatment decisions are made by doctor and patient, and patients are free to choose their own doctor. 

Health policy decisions are split between Belgium's federal government, regions, and communities. The national government regulates and finances the system; among other responsibilities, regions and communities deliver public and preventive health and coordinate primary and palliative care.

Financing

Financing occurs through a combination of progressive taxation, social security taxes, a consumption tax, and out-of-pocket payments (20%). Six private, noncommercial sickness funds provide compulsory health insurance to all Belgians regardless of economic status, medical condition, or risk; a federal agency supplies a budget to the sickness funds. Patients make a co-pay to physicians or hospitals, which bill the sickness fund for the remainder. Occasionally, patients make an out-of-pocket payment.

Delivery
Although primary care is typically the first point of contact for a patient and the health care system, there is no formal referral system. Thus for many patients, the specialist is the initial contact. Ambulatory care practices are private and paid via fee-for-service.

Belgium offers two forms of hospitalization: general (acute, specialty, and geriatric) and psychiatric. Alternatives include day hospitals and long-term care facilities, as well as community services of the elderly and the mentally ill.

While communities have responsibility for most public health services, including education and preventive care, they have on occasion collaborated with the federal government to coordinate and finance public health activities such as immunization and breast cancer screening.

Generally, the federal government sets policy and sets targeted taxes. For example, Belgian taxes on cigarettes and alcohol are designed at the federal level to discourage consumption. However, Belgium's Flemish, French, and German communities establish policies for their particular health needs.

Challenges

Belgium's health care challenges are familiar: The elder population will double over the next 25 years, creating budgetary and capacity difficulties. Moreover, aggregate costs will rise as medical inflation continues to outstrip general inflation. As a result, the federal government and the community government will struggle to meet the commitments to access, quality, and sustainability. 

Overall

According to the Brookings Institution,

Devoting only half as much of its GDP to health as the United States does, Belgium has created a flexible, public-private partnership to pay for and deliver health care that preserves many of the attributes that Americans desire: universal coverage; comprehensive coverage of physician services, hospital care, and prescription drugs; free choice of primary physicians and specialists; and acceptable waiting periods for non-emergency services.

WHO Ranking  21 (US 37)

To read more about Belgium's health care system, click here and here.

The Bismarck Model

Otto von Bismarck

In 1883, the reactionary German chancellor Otto von Bismarck, a Prussian autocrat through and through, proposed the health care model that came to be adopted by many European nations and that echoes decisively today in the American health care apparatus. Though no social reformer, Bismarck viewed universal health insurance as an effective tactic in his grand design for German unification, which trumped his conservative tendencies. What has come to be known as the Bismarck Model survived the German militarism of World War I, the unstable democracy of the Weimar Republic, Naziism, World War II and its aftermath, and eventual reunification. Its durability cannot be doubted.

Today, the Bismarck Model serves as the predominant means of guaranteeing universal coverage in Europe, used in Germany, France, Switzerland, Belgium, Netherlands, and others. (Japan is also a Bismarck Model country.) The implementation varies, but all mandate insurance in one form or another. In Germany, for example, employers and employees jointly fund insurance via withholding; in Switzerland, individuals purchase their own policies. Even so, Bismarck Model countries share common traits:

• Short waits, quality care, relatively low costs, and simplified administration
• Tight regulation of insurance which is often (but not always) sold on a nonprofit basis
• Claims paid without challenge
• No exclusion for pre-existing conditions
• Prices for most procedures fixed by the state
• Private hospitals and physician practices
• Generally high positions in the World Health Organization's overall rankings

There are, of course, tradeoffs. By eschewing a socialized system for which culturally most of them are ill-prepared, the Bismarck nations accept greater costs and less efficiency. (In health care, efficiency refers to performance measured against outcomes and costs.) While physicians receive a free education, have virtually no administrative overhead, and are rarely sued, they also earn less than their American counterparts. Moreover, despite state price fixing, cost issues are often addressed by raising premiums instead of controlling costs.

With the exception of veterans eligible for the VA system and active duty military personnel, most Americans under the age of 65 are either self-insured or have health insurance either as a benefit of employment. However, as indicated in the table above, the American approach to health insurance comes at a much greater cost than to countries operating under a pure version of the Bismarck Model. Lessons we can draw from these countries include:

• The importance of a universal mandate for insurance under the auspices of single program
• Consumer protections such as no exclusion for pre-existing conditions are feasible only with mandates
• Immediate payment of claims without challenge lowers administrative burden and the financial impact on patients
• Insurance regulation, nonprofit insurance, and a fixed price for procedures help control costs
• Privatized care can exist successfully in a regulated environment

Later, HealthMatters will look in detail at the approaches of various Bismarck Model countries.

The Big Four

The nations of the world have coalesced around four approaches to delivering health care:

• The Beveridge Model, wherein the government owns and operates health care. Cuba, England, Hong Kong, Italy, Spain, and the four Scandinavian countries all provide health care via the this model, which is named for the British reformer who designed the parameters of Britain's welfare state. Beveridge Model systems are characterized by their commitment to public health and primary care, as well as efficiency. Also known as single payer, the Beveridge Model is the embodiment of socialized medicine
• The Bismarck Model, wherein all residents of a country are required to have health insurance and insurance companies are required to sell it to them. France, Germany, and Switzerland and most countries of western Europe operate under this model (as does Japan), named for the German chancellor who designed it in the 19th Century. Insurance can be profit, non-profit, or both (depending on the country); individual or employer driven. In any case, the insurance and health systems of Bismarck countries are tightly regulated. Bismarck Model nations often have advanced systems of health information technology.
• The National Health Insurance Model, wherein each resident pays into a government run insurance program that compensates private-sector providers. As the sole insurer, the government has a powerful negotiating role with providers and pharmaceuticals. Canada, Taiwan, and South Korea provide national health insurance.
• The Out-of-Pocket Model, wherein access to health care depends on the individual ability to pay. All undeveloped, non-industrialized countries must resort to this approach, as they have neither the resources nor the infrastructure to adopt the Beveridge, Bismarck, or NHI models.

As you can tell, the United States has a bit of all four. VA health care is government-owned and -operated (Beveridge); most Americans get insurance through employment and will soon have it mandated (Bismarck); most Americans pay into Medicare (NHI); and the uninsured and underinsured look to their own devices (Out-of-Pocket).

HealthMatters will examine each of the first three models, covering their implementations in different countries and pointing out the tradeoffs that each country makes.