Learn About Universal Health Care: Definition, Advantages and Disadvantages

Universal health care is a broad term that encompasses any action that a government takes to provide health care to as many people as possible. Some governments do this by setting minimum standards and regulations and some by implementing programs that cover the entire population. But the ultimate goal is health coverage for all citizens.

Universal health care is a hotly debated topic on both sides of the aisle. It is important to learn about the benefits and drawbacks that are often cited regarding a nation-wide policy like universal health care.

• The most obvious advantage of universal health care is that everyone has health insurance and access to medical services and that no one goes bankrupt from medical fees.
• On the federal level, universal health care lowers health care costs for the national economy, because the government controls prices for medications and services. That streamlining trickles down to the doctors themselves, where they are able to reduce administrative costs and hire less staff because they’re not forced to work with a myriad of health care companies.
• Universal health care also equalizes service, with no doctors or hospitals being able to target and cater to wealthier clients. That means everyone gets the same level of care, which ultimately leads to a healthier workforce and longer life expectancy.
• When a person has universal health care from birth, it can also lead to a longer and healthier life, and reduce societal inequality.

A common criticism of universal health care is that the overall quality and variety of care declines.

• In some countries with universal health care, patients see long wait times or even have to wait months to be seen at all. Governments focus on providing essential and lifesaving health care and may neglect to cover rare diseases or elective procedures.
• Universal health care is expensive. If a government is struggling with its budget, it may find that health care is taking money away from other essential programs.

There are essentially three ways to provide universal health care.

1. 1. Socialized medicine. In this case, all hospitals would be owned by the government and all doctors and nurses would be government employees. The United Kingdom’s National Health Service, or NHS, is an example of this type of system. Over time, it has proven to be one of the most cost-effective systems. However, both doctors and patients have less choice in the range of treatments and procedures that are available to them.
2. 2. Single-payer system. The second solution is to have a single-payer system, like Canada. Under a single-payer system, the government provides health insurance for everyone, but doctor’s offices and hospitals are still private businesses or nonprofits. This type of system allows people more choice between doctors and hospitals with different approaches to care, but it also costs more than socialized medicine.
3. 3. Private insurance. The third system is to allow private insurance companies but regulate them and mandate that everyone purchase some type of health insurance plan. Switzerland has regulated health insurance and the Affordable Care Act, which was passed in 2010, is an attempt to build a mandated health insurance system in the United States. Regulated health insurance systems allow for the most consumer choice, but they are also the most expensive.

As of 2018, 32 of the 33 developed countries have universal health care. Additionally, there are countries on every continent that offer universal health care. They include:

• North and Central America: The Bahamas, Canada, Costa Rica, Cuba, Mexico, Trinidad and Tobago, United States.
• South America: Argentina, Brazil, Chile, Colombia, Peru.
• Europe: Austria, Belarus, Croatia, Czech Republic, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Luxembourg, Malta, Moldova, the Netherlands, Norway, Portugal, Romania, Russia, Serbia, Spain, Sweden, Switzerland, Turkey, Ukraine, the United Kingdom.
• Africa: Algeria, Botswana, Burkina Faso, Egypt, Ghana, Mauritius, Morocco, Rwanda, Seychelles, South Africa, Tunisia.
• Asia: Bhutan, Georgia, Hong Kong, India, Israel, Macau, Maldives, People’s Republic of China, Singapore, Sri Lanka, Taiwan, Thailand, Australia.
• Oceania: Australia, New Zealand.

The U.S. operates primarily on a system of private healthcare, which is supplemented by plans such as Medicare and Medicaid that are administered by the federal government.

Many individual states provide their own variants on government health care. For instance, MediCal is California’s state implementation of Medicaid.

Despite the variety of available programs, the United States does not have universal coverage. While the Affordable Care Act (also known as Obamacare) vastly expanded the number of Americans with coverage, it is not a universal health care system. Under the ACA, medical care is primarily financed by private insurers, while the government provides a subsidy to allow more citizens to participate in a private health insurance program. The ACA also prohibited private insurers from denying coverage to clients with a pre-existing condition—or from charging those individuals higher insurance premiums.

The U.S. has never had a universal health plan.

• The first formative efforts at establishing national health care plans began around the turn of the twentieth century with the Progressive Movement. In Theodore Roosevelt’s 1912 run for president on the Progressive Party line (sometimes known as the Bull Moose Party), he advocated for sickness insurance that would be guaranteed by state and federal governments. Roosevelt was defeated, and little was done about national health care until the 1930s.
• In the 1930s, Franklin Roosevelt (a distant cousin of Theodore Roosevelt) established numerous federal programs to establish a social safety net. Social Security was the most prominent of these programs, but Roosevelt (like his cousin before him) was unable to enact a national health insurance plan. His successor Harry Truman pushed for universal healthcare in his Fair Deal of 1949, but that, too, failed.
• A major breakthrough came during the presidency of Lyndon Johnson, who created Medicare and Medicaid as amendments to the Social Security program in 1965. These programs remain in place today.
• In the early 1990s, Bill Clinton made his own attempt to enact universal health care under a program spearheaded by First Lady Hillary Rodham Clinton. Modeled loosely on Canadian and European plans, the initiative attracted much public attention but ultimately failed.
• Prior to the passage of the Affordable Care Act in 2010, a sizeable percentage of Americans went without health insurance and received their medical care from the emergency room, which is the least cost-effective way of providing health services.
• The implementation of the ACA has added many more Americans to the insurance rolls, but universal care has not yet been realized.

When a country moves from completely privatized health care towards a policy of universal health care, the government driving the shift often encounters a fear of change.

When the United States moved to pass the Affordable Care Act, although it seemed like a drastic move at the time, it surprisingly added relatively little to the nation's overall health expenditures. Some 20 million people gained coverage, but insuring those people was relatively inexpensive because most of them were young people, who are much cheaper to cover than the elderly covered by Medicare.

• The majority of Americans had health care even before the Affordable Care Act.
• Most retired people had insurance through Medicare.
• Most working, middle, and upper-class Americans had insurance through their employer.
• Those Americans at or below the poverty line were eligible for insurance through Medicaid.

Those with insurance through their employers were worried that the new system would not be as good as the old system. This concern meant that Congress was unlikely to do anything that would get rid of the current employer-based health care system.

Making major changes to any public program, like health insurance, is a difficult undertaking. The existing system will only tolerate so much change at one time. Trying to do too much at once can be counterproductive. Nonetheless, health care reform is one area in which many economists feel that the most important work is yet to be done. The Affordable Care Act took the United States closer to universal coverage but still left millions uninsured.

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