What is Universal Health Care?

Universal health care is a health care system that provides health insurance to all legal citizens. It ensures that all legal residents of a country have access to quality basic medical care, regardless of income, employment, health condition, or other requirements. 

Let’s take a deeper look at universal health care. We’ll cover the different types of universal health care, its pros and cons, countries that have adopted it, and more. Use the links below to jump to a section of your choosing, or simply read on to learn all about universal health care.

• What is Universal Health Care?
• Pros and Cons of Universal Health Care
• Types of Universal Health Care Plans 
• Universal Health Care & the US

What is Universal Health Care?

Universal health care dates all the way back to pre-20th century Germany, where a system was set up that required industrial employers to provide healthcare to workers. In order to do so, all employees and employers contributed to a “sick fund”, which was used to pay for healthcare for those who needed it. From there, it spread to the UK, Russia, and more. In the first half of the 20th century, nearly all European countries developed a similar plan. By the end of the 20th century, universal health care systems existed in Europe, some Asian countries, Latin American, Africa, and more. 

Pros and Cons of Universal Health Care 

There are, of course, pros and cons to each universal health care system. These costs and benefits are what lead to such a varying landscape of universal health care systems across the over 30 developed countries that provide universal health care. Let’s review the pros and cons of universal health care.

Pros of Universal Health Care

The greatest benefit of universal health care, of course, is that it gives each legal citizen of a country the ability to access health care services regardless of their ability to pay. The World Health Organization, who.int, argues that health care is a vital basic need, and from a humanistic standpoint, providing citizens with access to health care is one of the most important roles of a government. Other advantages of a universal health care system include: 

• A uniform standard of care. Under a universal health care system, health practitioners are required to provide the same level of care to every legal citizen. The elimination of profit from the health care industry also eliminates the hierarchy of levels of care based on the ability to pay. 
• Lower costs for both citizens and health care providers. Under a universal health care system, there is no competition between health insurance companies. Instead, the government regulates health care costs. This drives the cost of healthcare down substantially. Similarly, it reduces administrative costs for doctors and health care practitioners, as there is no need to deal with varying insurance companies. 
• An overall healthier population. In a privatized health care system, many citizens are unable to access primary care physicians and preventative medicine due to their inability to pay. As a result, these citizens rely on the emergency room as their primary access to medical care. Emergency room visits are notoriously expensive, and often by the time a citizen needs emergency medical care, their health care problem is a much greater and more expensive one. Under universal health care, all citizens have access to primary care physicians and preventative medicine, often nipping future health emergencies in the bud. 

Cons of Universal Health Care

From an individualistic perspective, the greatest con of universal health care is that each individual must pay the same amount for medical care, regardless of their actual health. This effectively leaves healthy people paying for the care of sick people. Other disadvantages of universal health care include: 

• More government control in individual health care. A universal health care system may limit costly services that have a low probability of success. This may eliminate access to care that could potentially save a person’s life, because of the large possibility that it could fail and the associated cost. 
• Longer wait times to access elective procedures, and funds are focused on essential health care services for the population. 
• The substantial cost for the government. Universal health care can take up an enormous portion of a government’s yearly budget, in some cases totaling 40% of the total. 

Types of Universal Health Care Plans 

While universal health care is commonly associated with a single-payer system, universal health care can come in several forms. These include socialized medicine, single payer systems, and all payer systems. Let’s review the different ways that universal health care is provided throughout the world. 

Socialized Medicine

Socialized medicine, also known as the Beveridge Model, refers to a health care system that is entirely funded and run by the government. Under socialized medicine, all healthcare facilities are government-owned and managed. Health care employees included doctors, nurses, hospital staff, and more are government employees and are therefore paid and managed by the government. 

Under socialized medicine, every legal citizen has the same health insurance plan and access to the same basic health care. This includes medical, dental, and vision. It also includes hospital visits and prescriptions. 

• Pros: Socialized medicine often is the least expensive, as the government has total and complete control over the cost of health care. 
• Cons: Socialized medicine offers governments the most control over determining an individual’s health care, giving them the opportunity to block elective health care procedures due to cost. 
• France, Germany, Belgium, the Netherlands, and Japan all use this system. 

Single-Payer System

The single-payer system is also known as the National Health Insurance Model. Every citizen pays into a publicly run health insurance program, typically through taxes, and the government uses these funds to pay for healthcare, hence the name “single-payer”. 

Unlike socialized medicine, a single-payer system uses private-sector health care providers. Under a single-payer health care system, the government contracts private hospitals, doctors, or nonprofits to provide health care under the single available health insurance. 

A single-payer system offers the same health insurance plans and basic health care to each legal citizen, but offers a range of doctors, hospitals, and care to choose from. 

• Pros: A single-payer system offers individuals greater control over their healthcare, providing the ability to choose their doctors based on approach or reputation. 
• Cons: A single-payer system can be more costly, as it allows doctors and health care facilities to negotiate the terms of their contracts. 
• Canada, Taiwan, and South Korea use this system. 

All-Payer System

An all-payer system is also known as the Bismark Model, designed after the earliest forms of universal health care. Under an all-payer system, employees, citizens, companies, and governments pay into an insurance system that behaves as a “sickness fund”. The government then contracts private health care providers and uses this fund to pay for its citizens’ health care. Like socialized medicine and the single-payer system, an all-payer healthcare system provides all citizens with the same access to health care. 

• Pros: An all-payer system comes with tight regulation and offers the government similar cost control to socialized medicine. 
• Cons: The all-payer system relies on an overall healthy population, as a greater prevalence of sick citizens will drain the “sickness fund” at a much faster rate. 
• The UK, Spain, and New Zealand all use this system. 

Universal Health Care & the US

Unlike most developed countries, the United States does not offer universal health care. Instead, the United States offers a combination of private insurance and government-run health care. About two-thirds of United States citizens use private insurance, while the remaining one-third accesses government-run health care through the Affordable Care Act. 

The Affordable Care Act is the United States’ attempt to offer its citizens universal health care. One of the downfalls of privatized health care systems is that it gives health insurance companies the power to refuse coverage to people with pre-existing conditions or to offer them coverage at a much higher cost. Additionally, the competition that exists between health insurance companies drives the cost of health care up.

This often leaves citizens with substantial health issues without health insurance coverage and without the ability to pay the extreme cost for preventative medicine out of pocket. As mentioned earlier, when a citizen can’t access preventative medicine, they rely on the emergency room at a much higher rate, which is not only expensive but also often leaves them without consistent treatment of their health condition, therefore worsening their conditions. 

The Affordable Care Act was introduced to make health care available to everyone, including citizens who need it most. It requires all citizens to have health insurance and offers low-income citizens access to subsidized health care through Medicaid, the government’s health insurance. 

The Affordable Care Act and universal health care in the US continues to be a hot-button political topic, with some arguing that health care must be more available to citizens, and others pushing back against a universal health care system. 

In the meantime, there are plenty of ways to make your United States health care more affordable:

• Deductions: You may be able to keep costs down by exploring things like healthcare deductions. You may be able to deduct certain medical expenses such as unreimbursed prescriptions, medical appliances, and even treatments.
• Negotiating Bills: You might be able to negotiate medical bills. Try contacting your hospital’s billing department to see if there’s a way to reduce your medical debt.
• Health Savings Account (HSA): If you receive health care through your employer, a health savings account may be a more financially sound option for you.
• Prioritize Your Health: Finally, the most important way to keep the cost of your health care down is, of course, is by keeping your health in check. Be sure to exercise regularly, and opt for healthy food whenever possible. 

Navigating Medical Care without Universal Health Care

While we don’t currently have universal health care in the United States, there are still resources like the above to help you afford the medical care you need. Make sure to take advantage of all the resources available to you, and throughout the year, you can use the Mint app to track your medical expenses, then maximize your healthcare deductions when tax season comes around.