For some reason,camposol's original post has come down to medical care.
However, for what it's worth, I was a practice manager before retiring and the finance part was constantly drummed in. You're are right when you say you can't believe everything you read in the papers (a little like a Brit going to a private hospital in Benidorm and being charged so the Daily Mail is full of headlines about all elderly expats being refused free treatment)
but, and my figures will be a bit out of date as I retired 4 years ago, this was the situation then.
There is no need for Spain (or France for that matter) to pay anything to the UK.
There are (were) around 800,000 British living in Spain. Contrary to popular belief, only about 20% of those living in Spain are over retirement age. The figures were around 140,000 pensioners living on the S1 system and a further 200,000 with S1 rights due to NI payments which the NHS paid Spain for. The rest are either under the radar, not registered on the EU register or not living there for more than 6 months. That's 340,000 people per year who the British government pays the Spanish government for. On top of that, there is a huge amount paid for treating British in A&E deparments especially in the summer months. Spain sends a bill to UK for all those on the S1 and for those being seen whilst on holiday.
There are only around 60,000 Spanish living in the UK. Out of those, less than 10,000 are retired and the UK levies a bill against Spain for those. Those working in UK are given free healthcare and no bill is raised against Spain due to the free care provided for all UK residents under their system.Holiday makers are also quite few but a bill for A&E treatment is raised although not GP treatment.
So, the bill going from UK to Spain is about 300,000 euro per year. The bill from Spain for the treatment of expats and holidaymakers is well in excess of 1 bn euro per year. The bill for Spain is simply deducted from the bill for the UK.
The figures for France are similar although a lot less due to only about 225,000 brit expats in total living there (less than 50,000 on the S! system).
As an aside. one of the biggest costs to the NHS in UK are expats (those who have officially retired abroad) and come back to the UK for treatment. A lot of those are from Spain and France although quite a lot from America, Australia and other far flung outposts. It has been estimated (or possibly just made up) that these expats who are no longer entitled to healthcare in UK cost the NHS around £1440 each per year adding up to a staggering 2 biillion pounds.
Something to chew on.