Reuters Edge

FACTBOX: Europe's major health systems and how they work

(Reuters) - Here is a brief description of how health systems are funded and operated in a selection of major European countries and in the United States.


Britain’s National Health Service is the world’s largest publicly funded system, with a 2009/10 budget of almost 103 billion pounds ($170 billion). It was launched in 1948 promising “cradle-to-grave” healthcare for all, but in reality has been forced to introduce rationing of some services and treatments.

A cost-effectiveness watchdog called the National Institute for Health and Clinical Excellence determines which drugs should be paid for on the state health service. Some, including a number of cancer treatments, have been judged too expensive.

The NHS has been singled out for criticism by conservative Americans who oppose President Barack Obama’s health reforms.

NHS managers published a report in June warning of a 15 billion pounds budget shortfall in the five years from 2011, triggering fears of job cuts, longer waiting times and further curbs on drug spending.

Still, Britain’s so-called single-payer model is substantially cheaper than many others and spending on health as a proportion of national income is well below the European average.


The French health system offers universal healthcare largely financed by government through a system of national health insurance, though many people buy top-up cover.

It is regularly held up as one of the best in the world but the high standards come at a price. France spends a hefty 11 percent of its GDP on healthcare and the state insurance scheme consistently exceeds its budget.

The government said in June that it expected the deficit to hit 9.4 billion euros ($13.3 billion) in 2009 against a 4.4 billion euro shortfall in 2008.

Successive governments have battled to reduce expenditure, introducing a series of incremental reforms rather than any major overhauls for fear of provoking a public backlash. In 2004 it introduced small fees for visits to doctors. More recently, a number of small hospitals with low occupancy rates have been closed and France is cracking down on the over-prescription of drugs. A recent change will give professional managers greater powers to run hospitals and give hospital boards the task of balancing their books.


Germany’s parliament passed reforms to its healthcare system in 2007 to tackle rising costs and an aging population. It is one of the most expensive health systems in the world, costing about 140 billion euros a year.

Under the new system, introduced in 2009, a centralized fund has pooled salary-linked contributions from workers and employers. The fund includes tax revenues, amounting to about 7.2 billion euros this year, and the sum will gradually rise to about 14 billion euros.

Since 2009, every single German has had to have a health insurance policy. Until recently, some 300,000 people had no health coverage.

The fund already has a deficit of 3 billion euros, which will have to be covered by the government with a loan. Next year, that could balloon to 7 billion euros.


In the Netherlands the healthcare system is privatized, with the government ensuring access and quality. As of the start of 2006 all Dutch residents were required to take private health insurance, though the level of coverage is up to the individual.

Insurers may not reject anyone applying for the government-mandated basic package, though they are able to offer additional services at rates of their choosing beyond that.

The government also subsidizes the cost of insurance through the tax office for individuals earning less than 32,502 euros a year. In late 2008 the Euro Health Consumer Index rated the Netherlands, which spends 9.8 percent of national income on health, the best healthcare system in Europe.


The Spanish government has devolved health services to the country’s 17 autonomous regions over several years and has been trying to cut subsidies on medicines. But the central government still provides most of the funding for healthcare and is responsible for coordinating policy nationally.

Every Spanish citizen is covered regardless of whether they are employed or not. Two-thirds of spending on health in Spain is provided by the public sector, 90 percent of which is controlled by Spain’s autonomous regions, according to 2006 data from the Health Ministry.


Americans spend more per capita on healthcare than any other country at more than $7,400 per person, according to a recent report by the U.S. Centers for Medicare and Medicaid Services. Yet studies suggest Americans overall get poorer care than people in other industrialized countries.

Private insurance pays 35 percent of this; Medicare, the federal health plan for the elderly and disabled, pays 19 percent; Medicaid and the State Children’s Health Insurance Program pays 15 percent; 12 percent comes from other public funds; 7 percent from other private sources, and 12 percent is paid out-of-pocket by patients.

The U.S. Census Bureau says 46 million Americans, or 15 percent of the population, have no health insurance.

Reporting by EU and U.S. bureaux, compiled by Kate Kelland; Editing by Sonya Hepinstall