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    Chile's healthcare offers public and private plans

    Chronic care has guarantees

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    Mari Edlin
    As healthcare legislation muddles through Congress, the United States could stand to learn a few lessons from Chile, such as its effective public/private partnership and guaranteed care for those with certain chronic diseases, as well as a growing emphasis on primary care and cost-effectiveness. The Academy for International Health Studies (AIHS) sponsored 50 executive delegates who traveled to Santiago, the capital city, this fall to observe the country's health infrastructure.

    Chile boasts life expectancy of 78 years, compared to that of the United States at 77.7 years of life expectancy. In just 15 years, the country has seen a 50% reduction in child mortality and can boast an insured population of more than 90%.

    Unfortunately, 13.6% of Chile's 16.9 million people—40% live in the Santiago metropolitan area—are impoverished, and 10.8% are plagued by unemployment. The Ministry of Health, however, reports that 98% of Chileans have drinkable water, 99.5% have electric lights and 89% have sanitary sewers.

    MOST HAVE PUBLIC INSURANCE

    The Ministry of Health is the governing body responsible for establishing health policies and for reinforcing their compliance. Under its auspices fall the public healthcare system (referred to as FONASA) and regulatory responsibility for private health insurers (referred to as ISAPREs).

    The majority of the population (67%) is insured under FONASA, while 14.8% opt for insurance provided by ISAPREs. The remainder is covered by other private plans, and a fairly small percentage is uninsured. Healthcare is funded by a universal income tax deduction of at least 7% of every worker's salary and supplemented by government to cover indigents and public health programs.


    The delegation from the Academy for International Health Studies included executives from public and private U.S. health plans
    Beneficiaries in the public program are segmented into four classes based on income and subsidized accordingly. In addition, many private insurers encourage people to pay an amount above the 7% to upgrade their basic health plans.

    FONASA is financed with 48% public funding, 32% individual financing and 18% copayment, while 70% of ISAPREs funding comes from individual financing and 30% from copayments. Unfortunately, the costs of caring for people don't align with the number targeted or with risk. While the sectors equally receive 7% of wages, the public sector cares for about five times more people than the private sector. ISAPREs spend twice as much on members as FONASA does on its higher risk beneficiaries.

    The public sector not only serves as the primary insurer, but also the largest healthcare provider. The state owns and operates two-thirds of inpatient capacity with 200 hospitals, 2.3 hospital beds per 1,000, and 1,000 ambulatory medical centers. FONASA covers 90% of those over 65 (11.5% of the total population in 2005, which is expected to grow to 28.2% by 2050). ISAPREs' tightly regulated premiums are age/gender adjusted and therefore, premiums are higher for women and seniors, so seniors opt for FONASA.

    Chile's public insurance offers one plan at variable prices, while ISAPREs offer 13 plans, each of whose prices remain constant. Even if Chileans are covered under FONASA, they can access a private provider with a copayment tied to the amount of their income. A survey by the Ministry of Health shows there is overwhelming satisfaction with both the private (96.4%) and public (82.2%) healthcare systems in Chile.

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    Mari Edlin
    Mari Edlin is a frequent contributor to Managed Healthcare Executive. She is based in Sonoma, California.

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