Health insurance for our family of four costs $140 per month. It comes out of after-tax income and is not tied to any employer; if an employer provided health insurance, the fringe-benefit tax would apply to avoid the distortions that Americans crave. So losing your job only means losing your health insurance if you can't pay your premiums. We have a relatively high deductible, here called an "excess", of $2000. GP visits and prescription drugs are subsidised through the public health system but not entirely; we don't have a government services card provided to lower income Kiwis for greater subsidy. A GP visit costs about $40; it's cost us between $2 and $20 to fill a prescription script. We never bother saving the receipts because it's exceptionally unlikely that we'd ever reach $2000 unless some large event happened. We specifically wanted only a high-deductible emergency policy; such policies here are easily obtained because there aren't a bunch of crazy US-style mandates requiring coverage for a bunch of stuff we don't want.
Maternity is not included as part of private health insurance. With each of our two kids, the public health system covered the cost of the midwife of our choice; we supplemented that in both cases with a private obstetrician. The fixed-cost price for the first pregnancy was $2000; the second was $3000. In both cases we ended up with an emergency Cesarean provided by our hired obstetrician that involved no additional out-of-pocket expense or insurance claim. I expect that the public health system defrayed the costs of the emergency Cesarean.
A month ago, we had our first call on our private health insurer. On a Thursday, Susan fell rather ill. An evening visit to the 24-Hour Clinic was followed by a Friday ultrasound confirming gallstones. On Sunday, a physician from the 24-Hour Clinic called after having reviewed Susan's files and recommended antibiotics for inflammation that they'd missed on the Friday visit; I picked them up that afternoon. A Monday visit to the GP's office gave a Tuesday visit to the specialist surgeon. We called Sovereign, our health insurer, from the doctor's office at 12:30 PM, then faxed off some easily acquired paperwork at 1:00. Two hours later we had insurer sign-off for a Wednesday surgery at Southern Cross Hospital. Southern Cross is the biggest private insurer; our insurance is with Sovereign, but that wasn't a problem. The public health system also sometimes contracts for services at Southern Cross when there isn't enough capacity at Christchurch General.
The laproscopic surgery went well. Susan spent a night at Southern Cross Hospital and was home the next day; I ducked out of a Scholarships Advisory Committee meeting to run shuttle. We also have very nice scope pictures from the surgery. I wish I had asked about it earlier as the surgeon said that, with enough notice, we could have had a video. That would have been awesome; they just hadn't had the time to set it up since I'd waited too long to ask.
Our surgeon is contracted in by the public health system to perform surgeries for them; the public system would have had a couple months' wait. Because high-demanders like us are willing to pay extra to get things done quickly, the system as a whole gets more specialists who also can provide services to the public system. Similarly, our private obstetrician was also sometimes the duty senior obstetrician at Christchurch Women's Hospital. The public and private systems complement each other very nicely; such arrangements are entirely illegal in Canada.
Things I have never ever here had to do:
- Worry about whether our preferred GP, obstetrician, or specialist takes the insurance that we have;
- Have to take the insurance recommended by our employers;
- Have insurance tied to employment;
- Save receipts for reimbursement later on [we just mailed the bills to the insurer];
- Add up total health expenditures for a tax form to get a deduction;
- Wait in really long queues (Canada);
- Pay tons for private health insurance.
The Oregon Medicaid Study, as I read it (or see Cowen here), shows that the expansion of Medicaid mostly helped by reducing catastrophic costs that can otherwise face families with big health surprises. I can believe that finding. America has decided to make it difficult to get inexpensive high-deductible insurance coverage. If we take anything from Oregon, it should be that cheap catastrophic insurance should not be barred by regulatory mandates that effectively turn it into a full-cost full-coverage policy. [Update: see also Ross Douhat; Josh Barro disagrees]
There are many medical conditions where the expected quality of service in America far exceeds what is here available; big places can afford the expensive machines with the high fixed costs. But, on average, boy do we prefer things here.
If you're weighing up a move to New Zealand and considering the drop in after-tax salary, look instead to the rather smaller drop in after-tax, after-health-insurance salary here. We pay $1680 NZD per year for catastrophic coverage for a family of four. So this year, including the $2000 deductible from an unexpected event, we paid about $3700 for health care out of after-tax earnings.
