France's National Health Insurance Wrestling With Rising Costs

By Edward Cody
Washington Post Foreign Service
Wednesday, September 23, 2009

MARSEILLE, France -- When Jean-Louis Aloy could no longer walk comfortably among his olive trees in the hills above Marseille, he knew the time had come. Bowing to doctor's orders, he checked in to a hospital for a long-delayed back operation.

Despite the prospect of an expensive two-week hospital stay, Aloy, 58, did not worry. France's national health insurance, supplemented by a private policy for co-payments, covered the entire bill -- from doctor's fees to medication to a private room with a view -- and Aloy would not even know the total.

"All I have to do is fill out some papers and send them off to the insurance company," he said during a smoke break on a sunny terrace in front of the hospital two days after the surgery.

France has long been proud of its national health insurance, part of a many-tentacled and costly social protection system designed to embrace almost everyone who is legally in the country. Most French people have grown up with the idea that the government is the ultimate guarantor of health care, even for people who cannot afford to pay. The concept has become so ingrained over the past half-century that it is an untouchable part of the political landscape, making the debate over President Obama's proposals in Washington and the fading chances for a public option seem, in the words of the newspaper Le Monde, "altogether surreal."

But the fast-rising cost of drugs and medical care, particularly for the elderly in their final days, has raised the question of how long France can afford the health care it has come to expect. Seeking to beat back rising deficits, the government has reduced the reimbursement rate for many medicines and routine medical services, opening a growing market for private insurance policies, called mutuals, to cover the steadily increasing co-payments.

Without abandoning the bedrock of health care for all, therefore, the French system has begun to evolve toward something resembling Medicare, the health insurance for older people in the United States, except that it covers people of all ages. The shift is regarded as inevitable, specialists said, but increasingly it is raising the delicate question of how much the government will be forced to resort to even higher co-payments in the years ahead.

The health-care bureaucracy is so extensive and intricate that it has inspired urban legends. Coverage policies have grown complicated as medical care and drugs become ever more sophisticated. In that atmosphere, fraud has mushroomed.

But despite the drawbacks, the outcome is relatively cost-effective in comparison with the situations in other industrialized nations, according to tracking by the Paris-based Organization for Economic Cooperation and Development.

France spent about $300 billion for the health needs of its 64 million people in 2007, the last year for which reliable statistics are available, the OECD reported. That amounted to about 11 percent of gross domestic product for a system covering an estimated 99 percent of the population, well below what Americans pay for a system that leaves out tens of millions of people.

On a per capita basis, France also ranked well below the United States in health expenditures. It was eighth on the OECD list, while the United States ranked at the top.

Spending less apparently has not lowered the quality of health care. Despite their reputation for guzzling red wine and eating fatty cheese, French people have for years enjoyed a longer life expectancy than their counterparts in the United States, currently at 80.98 years compared with 78.11.

Expansion of Co-Payments

France's modern health-care system dates from a decision by Charles de Gaulle in the heady days just after World War II. In the interests of political unity, de Gaulle and his nationalist followers embraced a demand for worker protections that arose chiefly from communists and socialists who had been key in the Resistance movement.

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