The impact of private finance on publicly funded health care systems depends on how the relationship between public and private finance is structured. This essay first reviews the experience in five nations that exemplify different ways of drawing the public/private boundary to address the particular questions raised by each model. This review is then used to interpret aggregate empirical analyses of the dynamic effects between public and private finance in OECD nations over time. Our findings suggest that while increases in the private share of health spending substitute in part for public finance (and vice versa), this is the result of a complex mix of factors having as much to do with cross-sectoral shifts as with deliberate policy decisions within sectors and that these effects are mediated by the different dynamics of distinctive national models. On balance, we argue that a resort to private finance is more likely to harm than to help publicly financed systems, although the effects will vary depending on the form of private finance.

Current ideas about the role of the state include an enthusiasm for mechanisms of "indirect" or "third-party" governance. The health care arena, in which models of indirect governance have a long history, is an important test bed for these ideas. Classically, the arena was marked by trust-based, principal-agent relationships established to overcome information gaps. Over time (and to different degrees across nations), emphasis shifted to contractual relationships assuming relatively well-informed actors and then to performance monitoring and information sharing within complex and loosely coupled networks. In this latest stage, there is a risk that some important features of democratic leadership, and of decision making in the health care arena, will be eclipsed. Accountability mechanisms must clearly locate responsibility for actions and must allow for the exercise of professional judgment.

This three-nation comparison dissects the underlying factors motivating and inhibiting health system changes in the turbulent 1990s.by Carolyn Hughes Tuohy PROLOGUE: Canada, the United Kingdom, and the United States represent three largely English-speaking countries that, in their varying forms, are models of contemporary democracy. But the ways in which their health care systems have evolved are quite different as a result of choices made at critical historical points.In this illuminating comparative study, Carolyn Tuohy, a political scientist and deputy provost of the University of Toronto, discusses the substantial differences that separate the nature of the three health care systems and the resulting logic that shaped them. She emphasizes that an important characteristic of these systems is the different ways in which they have structured the relationship between the medical profession and the state.Tuohy earned her doctorate in political science from Yale University. Her research pursuits have focused on comparative public policy, with an emphasis on social policy. This paper distills an argument presented in her most recent book, which was just published by Oxford University Press: Accidental Logics: The Dynamics of Change in the Health Care Arena in the United States, Britain, and Canada. Tuohy also has authored numerous journal articles and book chapters dealing with health and social policy, professional regulation, and comparative approaches in public policy.

This article examines the cases of three health care states -- two of which (Britain and the Netherlands) have undergone major policy reform and one of which (Canada) has experienced only marginal adjustments. The British and Dutch reforms have variously altered the balance of power, the mix of instruments of control, and the organizing principles. As a result, mature systems representing the ideal-typical health care state categories of national health systems and social insurance (Britain and the Netherlands, respectively) were transformed into distinctive national hybrids. These processes have involved a politics of redesign that differs from the politics of earlier phases of establishment and retrenchment. In particular, the redesign phase is marked by the activity of institutional entrepreneurs who exploit specific opportunities afforded by public programs to combine public and private resources in innovative organizational arrangements. Canada stands as a counterpoint: no window of opportunity for major change occurred, and the bilateral monopoly created by its prototypical single-payer model provided few footholds for entrepreneurial activity. The increased significance of institutional entrepreneurs gives greater urgency to one of the central projects of health policy: the design of accountability frameworks to allow for an assessment of performance against objectives.

In political discourse, the term “single-payer system” originated in an attempt to stake out a middle ground between the public and private sectors in providing universal access to health care. In this view, a single-payer system is one in which health care is financed by government and delivered by privately owned and operated health care providers. The term appears to have been coined in U.S. policy debates to provide a rhetorical reference point for universal health insurance other than the “socialized medicine” of state-owned and -operated health care providers. This article, like others in this special issue, is meant to provide a more nuanced view of singe-payer systems. In particular, it reviews experience in the prototypical single-payer system for physician and hospital services: the Canadian case. Given Canada's federal governance structure, this example also aptly illuminates the scope and limits of subnational variation within this single model of health care finance. And what it demonstrates in essence is that the very feature that defines the single-payer prototype—the maintenance of independent providers remunerated by a single public payer in each province—also leads to a set of profession-state bargains that define the limits of variation.