There are few issues as contentious in American politics as healthcare reform. While one of the wealthiest countries in the world, many critics think the United States’ healthcare system actually does its economy an injustice and, in fact, costs the government more money under the current system than it would under some reform schemes.
Why doesn’t the United States government undertake comprehensive healthcare reform?
Aside from the difficulty in marshalling together needed political capital to do so, the government is also hampered by the “unknowns” that surround many reform plans.
Given that many taxpayers are hesitant to pay increased taxes and that many businesses are of the same position, the government in the United States also has to balance the dynamics of federalism with those two major blocs as it also works with the individual states to come up with a program.
But what exactly are the healthcare reform proposals out there?
Sure, many politicians cite the healthcare system in different countries as an example of what the United States should do, but few of them actually get into the nitty-gritty details of how these systems work.
Because of this, many critics rely upon these countries being relatively smaller economically and in terms of population to explain their healthcare system’s relative success and efficiency when compared to the United States.
In this article, we’ll describe the common reform proposals and how they work. On top of this, we will look at the pros and cons of each as well as try to give you some kind of idea how relevant that proposal might be to the United States’ case in specific.
Overall, the main concerns about universal healthcare schemes managed or supported by government dollars is that it is somehow less efficient and offers poorer quality care than a private medical system would.
Switching over from a private system to a hybrid or fully public system would then seem to imply to many voters that the choice must be between the best healthcare and mediocre but cheaper healthcare.
This is not the case, as we will discuss below.
A second concern revolves around expanding government entitlements and commitments but, as we shall see, not all healthcare reforms necessitate massive future outlays and expenditures. In fact, it can save the company money over time according to many studies.
In the developed world, four models of subsidized, national healthcare dominate the landscape.
Here are some of the more common reform proposals out there and their major features:
The Beveridge Model
This model is one of the easier to understand and is popular in many countries around the world. Basically, in the Beveridge Model, doctors and nurses are employees of the government itself and hospitals, etc., are governmental institutions.
This is supported by government funding and is part of the general civil service.
Private medical practices and insurance systems can exist alongside this, but it serves as the primary means by which citizens get healthcare.
The National Health Service in the United Kingdom is a great example of the Beveridge Model as the UK also has a private, albeit smaller, medical service that runs alongside the public option.
The benefits of this model are manifest while the cons are somewhat harder to pinpoint and mainly rely upon sporadic, even anecdotal, evidence.
The Beveridge Model saves governments and citizens money by controlling costs and determining everything from what the government will pay doctors and staff to the price of drugs.
Citizens don’t pay medical bills and will never receive one for the services rendered as everything is taken care of via tax revenues and other means of government income.
Criticisms of this model include the paucity of options, lack of staff and services, and a perceived degradation in the quality of healthcare.
Because of this, it is believed that wait times for surgery and even emergency services are longer in countries on the Beveridge Model but the date underpinning this is not conclusive.
The Bismarck Model
The Bismarck model is another single-payer healthcare system that involves insurance companies coordinating with the central government to keep healthcare costs under control.
On first glance, this would not seem much different from private insurance models as it is supported by payroll taxes and payments made to the insurance company.
Two fundamental changes that mark this system as being different than a purely private insurance model is that everyone has to have health insurance and hospitals as well as other medical institutions cannot operate for a profit.
Whereas in the United States many hospitals do operate as for-profit industries, the Bismarck model eliminates this incentive entirely and thus controls costs as a result.
Some side effects of this model are that doctors do not earn as much money as they would in places like the United States but also the cost to obtain a medical education is much, much lower than it is in the US. Germany and other countries employ this scheme to great success with most German medical facilities ranking among the best in the world for quality of care.
The National Health Insurance Model
Primarily found in Asian countries, this combination of the Bismarck and Beveridge systems is a single-payer system supported through taxes and thus the system covers everyone as a result. Patients can choose their hospital and their doctors but those institutions are limited in their profit motive which keeps things economical and efficient.
One of the largest advantages of this system is that it is easy to understand, obtain, and use but it is also one of the more expensive systems for both citizens and the government.
The Japanese healthcare system makes use of this model and that nation has some of the best healthcare and its people have some of the longest lives of anyone else in the world.
The Private Insurance System
This is the current system in the United States and it is not perceived as the most efficient though its proponents would have you believe it is responsible for the great medical advances seen in medical facilities in the US.
How it works is quite simple: Whether through an employer or on one’s own, a person obtains insurance from a private health insurance company and then pays that company a monthly bill to secure access to health insurance and then must pay deductibles on top of that when services are rendered.
Depending on the type of private insurance the patient has, the patient may or may not be able to choose their own hospitals or doctors. Some private insurance plans in the United States use “network” hospitals and doctors to keep costs low, but primarily for the insurance company.
Easily some of the most expensive healthcare anywhere in the world, private insurance and hospitals in the United States have a strong profit incentive and thus costs are harder to control under this model. In some cases, the health insurer and the hospital system are one and the same.
Additionally, many healthcare companies, insurers, and hospital chains are traded on the stock market.
These intersecting interests often result in a system that is opaque to healthcare consumers and extremely expensive to maintain.
Outside of the private system, the US has subsidized healthcare options though this scheme also has difficulty maintaining costs because of its need to operate alongside the private system.
The impact of the US system is that it makes health insurance a voluntary market commodity, like a car or a house, rather than a vital necessity to secure social welfare.
Because of this, some people of lesser means might view health insurance as a luxury and, even among those that have health insurance, going to the doctor or a hospital will also be seen as an expense to be avoided if possible.
In the United States, ambulances alone can cost patients thousands of dollars if they don’t have health insurance and hundreds of dollars if they do.
For people struggling to get by, that’s a lot of money.
The Japanese healthcare system, conversely, supports preventative care and encourages regular visits to a physician. Because healthcare is not viewed as a luxury but rather as something citizens must have, Japanese people live longer than anyone else.
But you can make similar cases for other nations that emphasize preventative care.
The problem with the healthcare reform debate is that it is so multifaceted, encompassing economics, sociological dynamics, and even personal beliefs.
What is clear is that the current system in the United States is extremely punitive to people of lesser means and this results in a less healthy population on the whole.
As a matter of course the government has to be concerned with this developing situation because it will cost more down the road to treat diseases which could be prevented now.
Whether or not anyone will have the political will and resources to carry it through remains to be seen but one thing is certain: The problem is not going away anytime soon.