Universal health care

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Universal health care around the world (November 2010).
 
  Nations with universal health care (determined by proxy of ≥90% skilled birth attendance and ≥90% social insurance coverage)
  Nations with legislated mandate for Universal health coverage, but which have not yet reached thresholds above
[1]

Universal health care – sometimes referred to as universal health coverage, universal coverage, universal care or social health protection - describes health care systems organized around providing a specified package of benefits to all members of a society with the end goal of providing financial risk protection, improved access to health services, and improved health outcomes.[2] Universal health care is not a one-size-fits-all concept; nor does it imply coverage for all people for everything. Universal health care is determined by three critical dimensions: who is covered, what services are covered, and how much of the cost is covered.[3]

Contents

[edit] History

Germany has the world's oldest universal health care system, with origins dating back to Otto von Bismarck's social legislation, which included the Health Insurance Bill of 1883, Accident Insurance Bill of 1884, and Old Age and Disability Insurance Bill of 1889. In Great Britain, the National Insurance Act 1911 marked the first steps there towards universal health care, covering most employed persons and their financial dependents and all persons who had been continuous contributors to the scheme for at least five years whether they were working or not. This system of health insurance continued in force until the creation of the National Health Service in 1948 which extended health care security to all legal residents. Most current universal health care systems were implemented in the period following the Second World War as a process of deliberate health care reform, intended to make health care available to all, in the spirit of Article 25 of the Universal Declaration of Human Rights of 1948, signed by every country doing so. The US did not ratify the social and economic rights sections, including Article 25's right to health.[4]

[edit] Funding models

Universal health care in most countries has been achieved by a mixed model of funding. General taxation revenue is the primary source of funding, but in many countries it is supplemented by specific levies (which may be charged to the individual and/or an employer) or with the option of private payments (either direct or via optional insurance) for services beyond those covered by the public system.

Almost all European systems are financed through a mix of public and private contributions.[5] The majority of universal health care systems are funded primarily by tax revenue (e.g. Portugal[5] Spain, Denmark and Sweden). Some nations, such as Germany, France[6] and Japan[7] employ a multi-payer system in which health care is funded by private and public contributions. However, much of the non-government funding is by contributions by employers and employees to regulated non-profit sickness funds. These contributions are compulsory and defined according to law.

A distinction is also made between municipal and national healthcare funding. For example, one model is that the bulk of the healthcare is funded by the municipality, speciality healthcare is provided and possibly funded by a larger entity, such as a municipal co-operation board or the state, and the medications are paid by a state agency.

Universal health care systems are modestly redistributive. Progressivity of health care financing has limited implications for overall income inequality.[8]

[edit] Compulsory insurance

This is usually enforced via legislation requiring residents to purchase insurance, though sometimes, in effect, the government provides the insurance. Sometimes there may be a choice of multiple public and private funds providing a standard service (as in Germany) or sometimes just a single public fund (as in Canada). The U.S. Patient Protection and Affordable Care Act is a law based on compulsory insurance.[9]

In some European countries where there is private insurance and universal health care, such as Germany, Belgium, and The Netherlands, the problem of adverse selection (see Private insurance below) is overcome using a risk compensation pool to equalize, as far as possible, the risks between funds. Thus a fund with a predominantly healthy, younger population has to pay into a compensation pool and a fund with an older and predominantly less healthy population would receive funds from the pool. In this way, sickness funds compete on price and there is no advantage to eliminate people with higher risks because they are compensated for by means of risk-adjusted capitation payments. Funds are not allowed to pick and choose their policyholders or deny coverage, but then mainly compete on price and service. In some countries the basic coverage level is set by the government and cannot be modified.[10]

Ireland at one time had a "community rating" system through VHI, effectively a single-payer or common risk pool. The government later opened VHI to competition but without a compensation pool. This resulted in foreign insurance companies entering the Irish market and offering cheap health insurance to relatively healthy segments of the market which then made higher profits at VHI's expense. The government later re-introduced community rating through a pooling arrangement and at least one main major insurance company, BUPA, then withdrew from the Irish market.

Among the potential solutions posited by economists are single payer systems as well as other methods of ensuring that health insurance is universal, such as by requiring all citizens to purchase insurance and limiting the ability of insurance companies to deny insurance to individuals or vary price between individuals.[11][12]

[edit] Tax-based financing

In tax-based financing, individuals contribute to the provision of health services through various taxes. These are typically pooled across the whole population, unless local governments raise and retain tax revenues. Some countries (notably the United Kingdom, Ireland, Italy, Spain, Portugal, Greece and the Nordic countries) choose to fund health care directly from taxation alone. Other countries with insurance-based systems effectively meet the cost of insuring those unable to insure themselves via social security arrangements funded from taxation, either by directly paying their medical bills or by paying for insurance premiums for those affected.

[edit] Social Health Insurance

In social health insurance, contributions from workers, the self-employed, enterprises and government are pooled into a single or multiple funds on a compulsory basis. These funds typically contract with a mix of public and private providers for the provision of a specified benefit package. Preventive and public health care may be provided by these funds or responsibility kept solely by the Ministry of Health. Within social health insurance, a number of functions may be executed by parastatal or non-governmental sickness funds or in a few cases by private health insurance companies.

[edit] Private insurance

In private health insurance, premiums are paid directly from employers, associations, individuals and families to insurance companies, which pool risks across their membership base. Private insurance includes policies sold by commercial for profit firms, non-profit companies, and community health insurers. Generally private insurance is voluntary in contrast to social insurance programs that tend to be compulsory.[13]

In some countries with universal coverage, private insurance often excludes many health conditions which are expensive and which the state health care system can provide. For example, in the UK, one of the largest private health care providers is BUPA, which has a long list of general exclusions even in its highest coverage policy,[14] most of which are routinely provided by the NHS. In the USA dialysis treatment for end stage renal failure is generally paid for by government and not by the insurance industry. Persons with privatized Medicare (Medicare Advantage) are the exception and must get their dialysis paid through their insurance company, but persons with end stage renal failure generally cannot buy Medicare Advantage plans.[15]

[edit] Single payer

The term single-payer health care is used in the United States to describe a funding mechanism meeting the costs of medical care from a single fund. Although the fund holder is usually the government, some forms of single-payer employ a public-private system.

[edit] Community-based Health Insurance

A particular form of private health insurance that has often emerged in environments where financial risk protection mechanisms only have a limited impact is community-based health insurance. Contributions are not risk-related, and there is generally a high level of community involvement in the running of such schemes.

[edit] Implementation and comparisons

Health spending per capita, in US$ PPP-adjusted, amongst various first world nations.

Universal health care systems vary according to the extent of government involvement in providing care and/or health insurance. In some countries, such as the UK, Spain, Italy and the Nordic countries, the government has a high degree of involvement in the commissioning or delivery of health care services and access is based on residence rights not on the purchase of insurance. Others have a much more pluralistic delivery system based on obligatory health with contributory insurance rates related to salaries or income, and usually funded by employers and beneficiaries jointly. Sometimes the health funds are derived from a mixture of insurance premiums, salary related mandatory contributions by employees and/or employers to regulated sickness funds, and by government taxes. These insurance based systems tend to reimburse private or public medical providers, often at heavily regulated rates, through mutual or publicly owned medical insurers. A few countries such as the Netherlands and Switzerland operate via privately owned but heavily regulated private insurers that are not allowed to make a profit from the mandatory element of insurance but can profit by selling supplemental insurance.

Universal health care is a broad concept that has been implemented in several ways. The common denominator for all such programs is some form of government action aimed at extending access to health care as widely as possible and setting minimum standards. Most implement universal health care through legislation, regulation and taxation. Legislation and regulation direct what care must be provided, to whom, and on what basis. Usually some costs are borne by the patient at the time of consumption but the bulk of costs come from a combination of compulsory insurance and tax revenues. Some programs are paid for entirely out of tax revenues. In others tax revenues are used either to fund insurance for the very poor or for those needing long term chronic care. The UK government's National Audit Office in 2003 published an international comparison of ten different health care systems in ten developed countries, nine universal systems against one non-universal system (the U.S.), and their relative costs and key health outcomes.[16] A wider international comparison of 16 countries, each with universal health care, was published by the World Health Organization in 2004[17] In some cases, government involvement also includes directly managing the health care system, but many countries use mixed public-private systems to deliver universal health care.

[edit] See also

[edit] Notes

  1. ^ David Stuckler, Andrea B Feigl, Sanjay Basu, Martin McKee (November 2010). "The political economy of universal health coverage". Global symposium on health systems research, 2010. http://www.pacifichealthsummit.org/downloads/UHC/the%20political%20economy%20of%20uhc.PDF. 
  2. ^ "2010 World Health Report". http://en.wikipedia.org/wiki/Universal_health_care#cite_note-whqlibdoc.who.int-0. 
  3. ^ "2010 World Health Report". http://www.who.int/healthsystems/topics/financing/healthreport/en/index.html. 
  4. ^ "Economic, Social and Cultural Rights: Questions and Answers" (PDF). Amnesty International. p. 6. http://www.amnestyusa.org/escr/files/escr_qa.pdf. Retrieved 2008-06-02. 
  5. ^ a b Bentes M, Dias CM, Sakellarides C, Bankauskaite V. Health Care Systems in Transition: Portuagal. WHO are Regional Offices for Europe on behalf of the European Observatory on Health Systems and Policies, 2004.
  6. ^ Physicians for a National Health Program "International Health Systems".
  7. ^ Chua, Kao-Ping. "Single Payer 101". February 10, 2006.
  8. ^ Sherry A. Glied, "Health Care Financing, Efficiency, and Equity," National Bureau of Economic Research Working Paper No. 13881, March 2008
  9. ^ Tomasky, Michael (March 22, 2010). "Healthcare vote: Barack Obama passes US health reform by narrow margin". The Guardian (London). http://www.guardian.co.uk/world/2010/mar/22/health-care-vote-us-obama. 
  10. ^ "Goliath – Research in Healthcare Financial Management – Industry & Business News Articles – Article, News, Research, Information". Goliath.ecnext.com. http://goliath.ecnext.com/coms2/browse_R_R016. Retrieved November 14, 2011. 
  11. ^ Michael Rothschild and Joseph Stiglitz, "Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Imperfect Information," Quarterly Journal of Economics, November 1976 (90:629–649) (known as the Rothschild-Stiglitz Model)
  12. ^ Paulo Belli, How Adverse Selection Affects the Health Insurance Market
  13. ^ "World Health Organization Health Financing Unit". http://www.who.int/health_financing/mechanisms/en/index3.html. 
  14. ^ "BUPA top coverage product and exclusion list". Bupa.co.uk. http://www.bupa.co.uk/individuals/health-insurance/treatment-care/treatment-care-exclusions. Retrieved November 14, 2011. 
  15. ^ http://www.medicare.gov/Publications/Pubs/pdf/10128.pdf
  16. ^ "International Health Comparisons: A Compendium of published information on healthcare systems, the provision of health care and health achievement in 10 countries". http://www.nao.org.uk/idoc.ashx?docId=e902d344-ab56-4808-ab63-399241d33484&version=-1. Retrieved November 14, 2011. 
  17. ^ Snapshots of Health Systems: The state of affairs in 16 countries in summer 2004 WHO[dead link]

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