Universal health care
| The dismal science|
Universal health care describes any system whereby all residents of a given jurisdiction, often a country, are covered by plans to pay for their medical needs as they arise. There are four basic healthcare models.
- The Beveridge model. Named after William Beveridge, the architect of the United Kingdom's National Health Service (NHS), this system gives the government the ability to directly provide and finance medical care via taxes, making available at no further costs to citizens the way public roads and hospitals are.
- The Bismarck model. Prussian Chancellor Otto von Bismarck introduced this as part of his welfare programs for the unification of Germany in the nineteenth century. Health insurance plans, or "sickness funds," are jointly financed by the employers and employees, and do not make profits. Unlike the Beveridge Model, this system has multiple payers but is tightly regulated, keeping costs down.
- The National Health Insurance model. This is a hybrid of the Beveridge and Bismarck models. While healthcare providers are private, the system is funded by taxes. Marketing and profits do not exist, and administrative costs are kept low due to its simplicity. This model also keeps costs low by limiting the types of medical services patients can receive and by making them wait for treatment.
- The out-of-pocket model. This is practiced in countries that do not have a universal healthcare program for one reason or another.
The first and third models are what people mean when they say "single-payer health insurance."
- 1 Advantages of tax-supported single payer universal health care
- 2 Disadvantages of tax-supported single payer universal health care
- 3 Budget concerns
- 4 An overview of various healthcare systems today
- 5 External links
- 6 References
Advantages of tax-supported single payer universal health care
- Health care for all citizens.
- No direct health insurance costs for businesses or individuals. This lowers inflation and increases employment by reducing the financial burden on businesses to provide workers' healthcare benefits and its associated costs. In short, it is good for business.
- Efficiency of scale and simplicity, thus lowering costs.
- Healthcare continuity not affected by employment status changes or age.
- Money invested in healthcare is spent only on healthcare and related administration, rather than on profit-making insurance companies. (This means that the main goal is to get people healthy and save their lives.) Furthermore, curing patients may not be a sustainable business model.
- Consistently longer life expectancy.
Disadvantages of tax-supported single payer universal health care
- Possibly higher taxes.
- Individuals have less incentive to live healthily. They can drink and smoke, for example, and not have to pay more for home health care  than someone who doesn't drink and smoke. (To be fair, larger amount of excise tax can be levied in alcohol and tobacco to offset the effect, similar to what we already have now.) They can take risky actions that have large payoffs for them when they win but large costs for everyone else when they lose.
- Many nations with universal healthcare have seen shortages in healthcare availability, resulting in long wait times e.g. Canada and the UK.
- Possible dependency on social services, reducing motivational incentives and individual fiscal responsibility.
- Stifling the potential for market innovation due to a lack of stimulus
The costs of maintaining universal healthcare, or financial limitations in its implementation, have a tendency to increase over time.
For example, the United Kingdom's National Health Service (NHS) was founded way back in the 1940s. There have been huge advances in pretty much every branch of medical treatment during the decades that followed, including, for example, the development of effective cancer treatments, intensive care and life support technology, and vastly improved pharmacology. With these improvements in medicine comes the ability to treat more conditions and keep people alive for longer, and with universal healthcare comes the obligation to do so. Many of these treatments are highly expensive, and are becoming increasingly dependent ton the private sector, namely the pharmaceutical industry, resulting in NHS money being routed back into the private sector. This is also compounded by increasing populations to serve and a boom in the elderly.
Hence the national cost of universal healthcare has been increasing. This, along with measures taken in response to the rising costs, has resulted in restrictive budgeting and performance pressure at every level of the NHS, an unnecessarily competitive culture (including hospital league tables), marginalisation of some services, and moderate waiting lists for some forms of elective surgery and other treatments. Regardless of the positive advances which have caused them, these negative effects have been a major target for criticism, with some regarding them as a sign that the quality of service offered by the NHS has declined.
This link between improved medical possibilities and rising healthcare costs also leads some to believe that universal healthcare has become—or will become—unsustainable. Arguably, it may also lead to increasing ethical and financial dilemmas of the "when do we pull the plug?" kind.
An overview of various healthcare systems today
Australia is perhaps unusual in that it developed two universal health care systems in quick succession. In the early 70's, a newly-elected Labor government implemented a system named Medibank. When Australians decided, less than three years later, that they'd like some more conservative government instead, Medibank was restructured into a government-owned private health insurer — complete with a name change to Medibank Private to ensure there was no misunderstanding — as a first step towards selling it off. Before this could happen, Australians changed their mind again, voted in another Labor government in 1983, which set up a new universal health care scheme, Medicare, and kept Medibank Private as a government-owned business to earn a profit for the government and keep the other, smaller private health insurers in line.
Medicare, is nominally funded by a 2% Medicare Levy on income, but in practice it is funded out of general revenue. Medicare covers 100% of in-hospital costs, 85% of specialist costs and 75% of general practitioners' costs. Depending on how they want to run things, medical organisations may either charge the patient the full cost of their treatment (the patient takes their receipts to Medicare to receive the rebate), bill Medicare directly (a practice known as "bulk billing"), or do something in between. In addition, the Pharmaceutical Benefits Scheme (PBS) subsidises a wide range of prescribed medications, and functions as a sole-purchaser for anyone looking to sell medication in Australia, keeping prices of medication down through volume purchasing.
Visitors from countries with reciprocal relationships with Australia (for instance, New Zealand) have limited access to Medicare (though all patients in Australia have access to free hospital care, regardless of whether they are Australian or not). The Australian health system is generally considered to be among the best in the world, providing reasonably timely treatment at a low cost to the country. Australia spends approximately 9.8% of its GDP on health care, also making the Australian system among the cheapest in the world.
Conservative distaste for the idea that a national government should have some responsibility for the health and well-being of the citizens who pay its taxes, and some strategic schmoozing by for-profit health care lobbyists, has led to the bizarre situation of even the private health insurance industry in Australia being heavily dependent on government money. Private health insurance premiums are an income tax deduction — an in-effect subsidy, and individuals above a certain income level who do not have private health insurance are subject to a Medicare Levy surcharge. 
It's not the first shot: that was the refusal of the then-Coalition opposition to support the original Medibank bill through the Senate. Or the Fraser Coalition government which undid universal health care less than six months after its introduction, creating a system whereby the better off would not pay into Medibank if they held private health insurance. Or the succession of right and centre right governments since 1990-ish that have introduced the health insurance rebate, the medicare surcharge levy, and the lifetime loading charge, all designed to push more and more people out of universal health care and into private health insurance. This is just the latest volley, and given that too few people (Gen-Y'ers who don't realise how good they had it) value universal health care to sustain it any more, it won't be long until Oz is back to an American-style system.
On the plus side, private health insurers and health care providers remain rather tightly regulated. Any premium increases are subject to government review and oversight, the premiums are generally modest — an individual can expect to have to spend no more than a day's earnings on their monthly health insurance premium, and policies tend not to be riddled with gotchas and exclusion, and they universally include allowances for eyeglasses, orthotic footwear, dentistry, physiotherapy, and even gym memberships and sporting equipment. The downside is that many questionable health practices with no proven benefits such as homeopathy, chiropractor, chelation therapy, crystal healing, acupuncture, etc. are also offered as an incentive coverage by private health insurers to attract customers. In 2013, Medicare clamped down on remedial massages being offered as a rebate, after it was found brothels were using it as an umbrella subsidy for their sex services. "The Lucky Country" indeed.
Under the Canadian Constitution, healthcare is a provincial responsibility. As a result, each province and territory has its own separate healthcare system (if you require treatment in another province/territory you may be billed for treatment, depending on the province and service required), and the federal government enforces certain standards of care in each system. Healthcare in Canada is generally funded by a combination of provincial sales tax and income tax, as well as federal transfer payments (a great source of contention in federal/provincial and interprovincial relations). Some provinces also have a specific healthcare levy, while in the Western provinces they've had good results in using casino (or oil) revenues.
There has recently been a bit of controversy about the introduction of more privatization; supporters claim that it will improve access; detractors claim it will create a two-tiered system that gives better service to the wealthy. This has been due to one highly controversial Supreme Court decision (Chaoulli v. Quebec) and suggestions from think tanks that should really know better. A good 30% of insurance is already paid through the private sector.
Despite being loved massively by the Canadian public and a source of national pride, the Canadian healthcare system routinely ranks among the worst of any developed nation, being ranked dead last in a survey of experts by the New York Times and third last by the OECD. At present, wait times can be long, sometimes frustratingly so. Meanwhile, some medical facilities have been closed due to mass resignations. Overcrowding can happen and, in extreme cases, lead to death. It is evident, therefore, that the Canadian healthcare system is understaffed and underfunded.
In addition, the system is one of the costliest of any developed nation as well. About 50% of government spending goes towards the nation's healthcare program, and it is projected to reach 80% by 2030, an unsustainable number.
China, the People's Republic of
Since the dismantling of much of the Communist healthcare system under economic reforms, access to healthcare in China has deteriorated substantially. Citizens found they needed to save substantial sums to cover potential medical bills, depressing consumer spending, with patients in impoverished rural areas often refusing medical treatment for fear of costs.
The Chinese government, apparently not realizing what a success story its healthcare system was, has since reformed the healthcare system with public insurance programs. Now, almost the entire population is covered by insurance, though it only covers about half of healthcare costs in most instances, though it is working on making healthcare affordable to everyone by 2020.
Costa Rica has an improving comprehensive system.
Whether the system itself is really as good as claimed or not, Cuba is a major exporter of highly trained medical talent, with Cuban doctors involved in humanitarian efforts around the world.
Cuba's healthcare system is an extreme form of the Beveridge model, with absolute government control.
All Danish citizens have the right to free treatment from general practitioners, specialists and public hospitals. Depending on personal income, it may also be possible to get financial support from the municipality for other health-related costs.
About 1.8 million Danish citizens are also members of Sygeforsikringen danmark (Health Insurance Denmark), a private mutual insurance company, which offers refunds of up to 85% on expenses not generally covered by the public health insurance, such as certain types of medicine, eyeglasses and dental care.
Government expenses for the public health care system amounts to ca. 14 billion, or about 2500 USD per citizen, per year. The system as a whole generally functions well, but is however plagued by certain structural problems that lead to inefficiency and dissatisfaction in certain sectors.
As a result of the 2001-2011 Liberal/Conservative government's not-so-subtle attempt at starving the beast, the private health-care sector in Denmark has expanded quite a bit in the later years, and the sale of private health insurance have been steadily rising. In 2010 it was forwarded that the then-prime minister, Lars Løkke Rasmussen, an avid admirer of the American health care system, had, in his period as Minister of Health, deliberately over-paid the private hospitals in Denmark in order to help them out-compete the public hospitals.
The French pay comparatively little for the quality of care they receive. The disadvantage is that many hospitals need serious renovation, and getting extraordinary medical care, or routine care on weekends, is unlikely.
The vast majority of healthcare costs are covered by a public fund that ranges from about 70% reimbursement to 85%, while long-term medical costs are reimbursed 100% by the government. General Practitioners are all privately employed but financed through these public funds. General Practitioners, however, are not required to act as gatekeepers, so patients can directly approach a specialist in order to avoid over-prescribing. "Additional coverage" insurance, which is mostly from not-for-profit mutual insurers that work directly with the public system, provide funding for private doctors, while more advanced technology (think "MRI" vs. "X-ray" for a broken bone) and shorter wait times for routine care which can be purchased at a fairly minimal cost.
Germany has a universal health care system made up of both mandatory public insurance and private plans (the self-employed and high-wage workers can opt out of the public plan and obtain a private one). The conditions and prices of the public plan are mandated by the government, but supplied by a range of contractors who may include additional benefits. Its costs are shared equally between employers and employees, who have to contribute a fixed share of their monthly payroll regardless of income. The premiums of low-income workers are subsidized by the state, which also supplies coverage for the unemployed.
Comparatively little tax money goes into the system, but the premiums have a noticeable effect on the cost of labor. High-wage earners and the self-employed can sign up for any of the nation's 200 private health insurance plans. If a German who uses the public plan doesn't like their insurance company, they can switch to another, with no increase in premium. And there's usually little or no wait to get elective surgery or diagnostic tests, such as MRIs. In Austria and Germany, if a doctor diagnoses a person as "stressed," medical insurance pays for weekends at a health spa.
Everyone living in Israel must sign up with one of four Health Maintenance Organizations (HMOs), and can switch between them once a year. The HMOs are required by law to operate as non-profit organizations and must offer the same basic package, which covers a wide range of medical procedures and medications. They can also offer their own additional health policies, but cannot deny anyone membership in one of their policies, although they can charge premiums based on age. The self-employed must pay their premiums, while employees must pay a partial premium deducted from their paychecks, with their employer covering the rest. Premiums are also deducted from pensions.
Everyone in Japan is required to get a health insurance policy, either at work or through a community-based insurer. Eighty percent of Japan's hospitals are privately owned — more than in the United States — and almost every doctor's office is a private business, though 70% of all treatment is paid by the government. "Private" in this case, however, is quite a bit different than in other countries: hospitals and clinics, by law, must be run completely by doctors and must be non-profit organizations. For-profit corporations aren't allowed to run hospitals or clinics. Also, health costs are tightly regulated by the government, and are negotiated by government officials and physicians--no insurance lawyers allowed. The tight regulation of costs is a big reason why the cost of healthcare in Japan is so low compared to almost everywhere else.
In Japan, waiting times are so short that most patients don't bother to make an appointment.
Dutch citizens may choose between private and public health care, where public health care consists of special programs provided by the same companies that offer private health care.
The maximum fees of these public programs are restricted by the government, a typical public health insurance including dental care costs around 80 euros a month. Health care for all minors (less than 18 years old) is free.
New Zealand's Accident Compensation Corporation is an insurance fund paid into by all employed citizens, which then funds treatment for accidents and provides a percentage of salary lost due to accidents. Public hospitals provide care to a large portion of the population with means-tested fees and long waiting lists in some cases, while private hospitals cater to the wealthy and the privately insured. The ACC has a "no fault" policy which removes the ability for people to sue for personal injury except under extreme circumstances or cases of gross negligence. Prescriptions are heavily subsidised, and almost all drugs are purchased via Pharmac, a government-run body with massive negotiating power.
Norway has a tax-funded mandatory system run by four Regional Health Authorities. For anyone below 16 years of age as well as pregnancy related issues there is no cost, while others pay a nominal fee for examinations, and pay for medication (some heavily subsidized). There is an upper annual cost limit (US$250 in 2015) per person; everything above that is free. Hospitalization and related ambulance services are always free. All have the right to a choice in hospitals. Health services are provided by a combination of public and private entities, where the private entities compete for government contracts. Dental care is, with some exceptions, not covered by the universal health care system, but is free for youths up to 18 years of age. Supplemental private health insurance also exists, usually as job fringe benefit, and is mostly used to get quicker access to services in non-urgent matters that does not require hospitalization.
Expenditure on healthcare is about US$9,715 per capita per year, among the highest in the world.
Spain has a health system paid for by taxes. Quite centralized but it works quite well. Hospital care covered but patients sometimes have to wait for non-urgent treatment. Standard charge for prescription medicines with reductions for pensioners. People have the option of taking out private health insurance if they don't want to wait for their non-urgent operations. Apart from the central system there is also a system of General Practitioners (aka. family doctors) who provide localised care. The quality of this service varies from the really outstanding to quite poor.
As far as dental treatment is concerned, urgent extractions are covered by the state system, but all other treatment is private.
Sweden has a decentralized, primarily tax-funded system, governed by the regional councils. Typically, the patient pays a nominal fee for the examination, and the patient pays for their own medication. Both of these have an upper annual cost limit; if the patient reaches this limit, any additional health care or medication, respectively, for the duration of the year (counting from the first registered visit) will be provided free of charge. Urgent cases are always prioritized, and emergency cases are treated immediately.
Each visit to a doctor costs 150-300 SEK (roughly $23-$45). This entrance fee covers any further specialist visits deemed necessary by the doctor. The same fee is levied for ambulance services.
Dental care is not covered by the universal health care system, but is free for youths up to 18 years of age. A private healthcare system also exists, but is not broadly utilized.
United Kingdom, the
Britain's National Health Service is similar in principle to Spain's, namely, a centralized system paid for by taxes. Hospital care is covered but patients sometimes have to wait between consulting about an issue and beginning treatment; typically a maximum of 18 weeks for non-urgent treatment and 4 weeks for cancer care. People have the option of taking out private health insurance if they don't want to wait for their non-urgent operations or share a ward with the hoi polloi.
In England, and Northern Ireland, there is a flat charge for prescription medicines, but there are exemptions for the elderly, the very young, those on low incomes, expectant mothers — those who are terminally ill or suffer from certain chronic conditions like cancer or diabetes can apply for Medical Exemption Certificates for free prescriptions. Reduced price 'season tickets' are available for those on long-term medication. There are no prescription charges in Wales. In April 2011, Scotland abolished prescription charges for everyone.
The government of David Cameron attempted to edge it closer to the American model by privatisation in various guises. This effort is fiercely opposed by the majority of the British populace, and 9 out of 10 doctors oppose the government's "Health and Social Care Bill" that will abolish Primary Care Trusts and place 80% of responsibility for finance on general practitioners, which is expected to lead to the hiring of outside private groups to manage hospital's financial matters. It was also opposed by the British Medical Journal, The Lancet, the British Medical Association, Royal College of Radiologists, Royal College of Paediatrics and Child Health, Royal College of Nursing, Royal College of GPs, the Faculty of Public Health, and the Royal College of Midwives — basically most doctors, specialists and hospital workers. Despite the almost complete opposition from experts, the bill was passed by the Conservatives in 2012.
Dental care is not fully covered by the NHS, but the repercussions of this are not obvious, particularly to Americans who would never base a stereotype on such a shortfall. Dental care is free for those in full-time education, those on certain benefits, and those with certain medical conditions.
There is even a Twitter page of real British people expressing support for the NHS. This led to Twitter crashing when millions of Britons turned up to defend the NHS. The NHS supporters included Stephen Hawking, who said "I wouldn't be here today if it were not for the NHS." This was in response to an especially unresearched article claiming that Hawking, who has suffered from ALS for many years, would have been euthanised under the NHS.
United States of America, the
Due to a decision during WWII, health insurance became an untaxed benefit that employers could use as an incentive to get around wage freezes. Immediately after this decision pretty much all companies began offering health insurance, which continued even after the end of the war, and this coincided with an increase in quality and relevance of health insurance. Thus, when Presidents Harry Truman and Dwight D. Eisenhower considered starting up a single-payer system, the strongest opposition came from the labor unions, who considered this a massive threat to their interests. With a single-payer system, the unions would have one less incentive for workers to join them. They were successful in killing it, thereby setting it on the course that got it to the present day:
The current American healthcare system is an amalgam of all four basic models listed above. It uses the Beveridge Model for veterans, the Bismarck model for those with employment-based insurance, the National Health Insurance model for the elderly (Medicare), and the out-of-pocket model for everyone else, or 15% of the population. Such a system is neither efficient nor cost-effective. At least 18,000 people die unnecessarily every year in the United States simply because they're uninsured. In fact, the main problems are with mortality among younger Americans. Total health spending is 17.6% of GDP compared to a developed country average of 9.6%, and most of it goes to profit margins for private insurance companies. For-profit health care encourages the use of expensive procedures, drugs and medical equipment to treat relatively minor issues while the root of the problem is ignored. In other words, Americans spend far more for worse care ($947 per person on average compared to $487 per person in developed nations overall) while subsidizing healthcare costs for other countries, including those in Europe. In fact, a 2000 World Health Organisation report noted that the USA ranked 37th out of 191 member states for the quality of health care available to its citizens. France topped the list, though given the aforementioned subsidies, it probably owes its status to the U.S.
On top of this, Roman Catholics have been buying up American hospitals and sometimes own the only hospital in an area. This leads to them imposing their ethical system. No abortions, no contraception, no sterilization and a ban on many fertility treatments.
On March 23, 2010 the Affordable Care Act became law, having both massive support and criticism. In brief, the law lowers health care costs, holds insurance companies more accountable, provides more health care choices, and enhances the quality of health care for everyone. However, it is not a true universal health care system.
The best aspect of the current U.S. healthcare system is cancer treatment, only topped by Japan in providing high-tech screening. However, its effectiveness is held back due to a lack of access.
In recent years, there has been growing support for universal health coverage, championed by the most popular national politician, Bernie Sanders, who calls his proposal Medicare for All. A poll conducted by the Kaiser Family Foundation, a nonpartisan think tank, in March 2018 reveals that a majority of Americans support major reforms to the American healthcare system. Specifically, 59% support Sanders' Medicare-for-all proposal and 75% favor a public option or expansion of Medicare. Another conducted by Reuters in June and July 2018 shows that a vast majority of Americans, 70%, now support single-payer healthcare. Medical service providers are also warming to the idea. Even though their payments may fall in the long-run, administrative costs and the amounts of paperwork will also decrease. What really matters to them is not reimbursement rates but net income. Healthcare spending could drop to Canadian levels. Sanders wants to phase Medicare for All in over a period of four years. The only state to have had any form of universal health care recently was Vermont, which passed a single-payer health care system in 2011, though they eventually had to replace it due to its unsustainable costs. However, to be fair, it's not a true single-payer plan as big businesses operating in multiple states were exempt from it, which cut into the funding.
This is why some people are puzzled by the horror stories of people in the U.S. suffering or dying because they cannot afford care as well as (mainly right-wing) politicians refusing to do anything because "creeping socialism".
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- ie. the usually-sane CD Howe institute, which believes that "no country has adopted the Canadian model." (This assumes that Taiwan and South Korea don't exist.)
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- See the law
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