What You Should Know About Universal HealthCare Coverage

"Universal health care" or "universal coverage" refers to a system of allocating healthcare resources where everyone is covered for basic healthcare services and no one is denied care as long as he or she remains legal residents in the territory covered—such as all the citizens of the country of Canada.

The concept of universal health care is often incorrectly equated to a single-payer, government healthcare system, where all medical expenses are paid by one entity, usually the government. However, "single-payer" and "universal" are not the same, nor is "socialized medicine."

Universal Coverage

A system of "universal coverage" can mean two slightly different things. First, it can refer to a system where every citizen can access either public or private health insurance. Second, it can refer to a system where every citizen automatically obtains free or low-cost basic services (prevention, emergency medicine) for a government-mandated set of standard benefits.

In the United States, the goal of universal coverage animated the adoption of the Affordable Care Act—sometimes called Obamacare. Under the ACA, health insurance companies could offer specific health policies with a mix of benefits required by law. For people who fall at certain percentages of the federal poverty line, a sliding scale of public subsidies pay some or all of their premiums. The intended net effect was that anyone, regardless of income, could afford at least a reasonable basic health-insurance plan.

While nearly 20 million previously uninsured Americans gained coverage under the ACA, as of 2019 there are still around 28 million nonelderly adults without insurance in the US, about 10% of the population.

Single-Payer Systems

In a single-payer system, however, there are no private insurance companies, to begin with. The government alone authorizes and pays for health benefits. The classic example of a single-payer system is Great Britain's National Health Service; the NHS controls access to healthcare resources and even employs the healthcare providers. Canada offers a similar scheme

Some members of the U.S. progressive movement have suggested that the United States could arrive at a form of single-payer health care by offering "Medicare for All"—that is, by taking the government-payer program for the elderly and universalizing it to all citizens. The idea has gained traction in recent years, with November 2019 polling showing that a majority of Americans support a Medicare for All program, and Medicare for All legislation cosponsored by half of the House Democratic caucus.

Public-Private Partnerships

Throughout the world, many countries offer health care universally, to all their citizens, in public-private combinations, and not through single-payer systems. Examples of these countries include Germany, the Netherlands, and Singapore. Singapore enjoys one of the most successful health systems in the world, with long life expectancies and low infant mortality rates.

Managing Risk

In any system where private insurers play a role in healthcare financing, individual health insurance companies must balance the ratio of sick-to-healthy in their consumer base in part through the value-added products and services they offer atop government minimums, and how those extras are priced in the open market.

In some places, the government protects the insurers against significant loss in part by "penalizing" insurers whose risk profiles performed better than average and then equalizing the costs. This approach is called risk adjustment.