Health Insurance Costs in the US vs Australia: Public and Private Options
When comparing the healthcare systems of the United States and Australia, one of the significant factors to consider is the cost of health insurance. This article will explore the differences in health insurance costs between these two nations, with a specific focus on both public and private options.
Differences in Health Insurance Costs in Australia
Australia has a robust and largely publicly-funded healthcare system, often referred to as Medicare, which provides comprehensive coverage to all citizens and residents. However, private health insurance plays a role in many Australians' healthcare journeys.
Public Health Insurance in Australia:
Everyone pays a two percent (2%) levy on their income as part of their income those earning above a certain threshold, there is an additional 1.5% levy if they do not have private health insurance.Comprehensive health insurance plans usually cost from a few hundred dollars to around 3,500 Australian dollars per year, which translates to approximately 2,500 US dollars. This cost is notably manageable, making health insurance in Australia a relatively affordable aspect of living there.
Health Insurance Costs in the US
Health insurance in the United States differs significantly from Australia, particularly in terms of both public and private options.
Private Health Insurance in the US:
Private insurance is generally more expensive than the public options in premiums for private health insurance can range widely, but are often less than the annual cost in Australia.Medicare in the US:
Medicare, the public health insurance program for people aged 65 and over, and for those with certain disabilities, is significantly more expensive than both private insurance in the US and public health insurance in average cost for Medicare is $22,000 per year.According to leftist arguments, a commonly cited figure is that Medicare costs $13,000 per year, but this is a misleading figure. The actual average cost for Medicare is much higher, nearly double this amount.
Reasons for High Healthcare Costs in the US
The high cost of healthcare in the United States is due to the significant role that healthcare plays in the economy. Healthcare constitutes approximately one-sixth of the GDP, and the US government heavily taxes this economic activity.
Economic Impact:
The high cost of healthcare keeps the system economically vital, contributing to the nation's to a universal healthcare system (UHC) in the US would result in a significant reduction in government tax revenue, estimated to be over a trillion dollars cuts are politically unpopular, and even transitioning to UHC would not significantly lower costs, as it would merely shift the burden to those paying taxes.Government vs Public Demand:
The government would face significant challenges if it were to reduce healthcare costs, as this could be seen as an attack on a valuable economic sector.Encouraging citizens to prioritize their health to reduce demand on the system is a potential solution, but this approach is unlikely to be favored by the government as it might reduce economic activity.Overall, the high costs of healthcare in the US are deeply entrenched in the economy and political landscape, making significant reform a complex and challenging task.
Conclusion
Health insurance costs in the US and Australia present a stark contrast, with Australia offering more affordable options through both public and private health insurance. In the US, the emphasis on private insurance and the high costs of Medicare contribute to a more complex and expensive healthcare system. Understanding these differences can provide valuable insights for individuals and policymakers seeking to improve healthcare access and affordability.