There are various types of health care systems around the world. There are, however, two general types of classifications under which they can fall: private and public. While the public health care system is principally funded by the government, private health care systems function primarily on the basis of private pay by the individual insured. Though government-funded health care components exist in the USA, such as Medicare and Medicaid, the general system is fundamentally private in nature. Each system has its benefits and shortcomings but it is not the point of the current discussion to advocate for one over the other.
One of the simplicities of the public system is that there is only one provider of insurance and therefore the type of insurance everyone gets is the same. Conversely, in a market or private system, there are different options for insurance, and indeed the type of coverage offered and its benefits may vary markedly between individuals. Therefore, the benefits of having multiple coverage options is largely dependent on the consumers' knowledge of the products offered.
In light of the new Affordable Care Act (ACA) in the USA, a recent research survey out of Carnegie Mellon University was conducted to evaluate whether consumers have the understanding to make informed decisions, given the expansion of options for choosing health care. Their survey included the assessment of the comprehension of four health insurance concepts: deductibles, copay, coinsurance, and out-of-pocket maximums.
Despite reporting feeling confident about their comprehension, the survey found that a mere 14 percent of respondents actually understood all four of these concepts. Moreover, only 11 percent were able to compute insurance costs for a standardized scenario when presented with all the necessary information. The authors subsequently demonstrated in a second survey that simplification of insurance policies can result in improved understanding of the policies and choices for insurance coverage.
Quite apart from the legislative prerogative to overhaul health insurance access and delivery options, this research suggests that it is vital to simplify information gathering and education about health insurance in order for these changes to translate into meaningful benefits for consumers.