Sometimes an individual, a group, or a nation distinguishes itself because it stands apart from the rest. A case in point, the U.S. stands alone as the only developed nation that does not assure that all its citizens have health care coverage. Defining coverage as universal means that everyone is covered. Even if the U.S. House and Senate manage to reach consensus on compromise language in the disappointing health care legislation coming out of Washington, the legislation will not provide universal coverage.

Why is it that the U.S. fails where other countries succeed? Is it the rugged individualism of the American psyche? A middle class Swiss woman, commenting on mandated coverage and concern over it in the U.S. said, “Oh, I see. That’s really an American question. You are so used to having this individualistic way of thinking, and that’s why you don’t have these social (safety) nets. You still have this pioneer mentality where everyone has to take care of themselves…I’m happy to give part of my salary to a solidarity system,” according to Julie Rovner of NPR.

Or could it have more to do with the stranglehold health insurance corporations and their lobbyists have over our elected officials? Given the recent Supreme Court decision, that corporate influence promises to grow even stronger.

T.R. Reid, correspondent for the Washington Post and author of The Healing of America – A Global Quest for Better, Cheaper, and Fairer Health Care (thank you, Fran Kosloski, for sharing), sees another problem with the U.S. health insurance industry. “The fundamental difference here is that foreign health insurance plans exist only to pay people’s medical bills, not to make a profit. The United States is the only nation that lets insurance companies extract a profit from basic health coverage…Health insurance companies don’t have to be cruel to their customers if they don’t have to worry about paying dividends to investors. But insurance firms whose primary mission is to make a profit quickly realize that covering every applicant and paying every claim will eat into profits. So they deny coverage to those who need it most, reject claims by the bucketful, and search for ways to rescind coverage just when the big bills roll in. That’s why U.S. health insurance companies are loathed by their customers but loved on Wall Street. That’s why health care economists around the world say that there’s a basic conflict between the principle of health insurance and the pursuit of profit.”

Myths and misconceptions abound when it comes to understanding foreign systems of health insurance coverage. Perhaps the biggest misconception is that they are all alike and that all are ’socialized medicine’ (funded by government with doctors as government employees). According to T.R. Reid, “The term (socialized medicine) was popularized by a public relations firm working for the American Medical Association in 1947 to disparage President Truman’s proposal for a national health care system. It was a label, at the dawn of the cold war, meant to suggest that anybody advocating universal access to health care must be a communist. And the phrase has retained its political power for six decades.”

The fact is, most foreign systems are not socialized. In The Healing of America, Reid divides the systems into various categories or ‘models’. Even within the same model, countries vary on the details of their approaches.

As used in the following explanations, the term ‘provider’ means the doctor, medical practitioner, hospital, etc. The term ‘payer’ means the insurance entity that pays the medical bills. The descriptions below are just brief overviews and oversimplifications not meant to give a detailed account of these systems. Keep in mind that they require occasional tweaking to address shortcomings.

The Bismarck Model – As the name suggests, this model is named for Otto von Bismarck who instituted a national health care system in 19th century Germany. In the Bismarck design, providers and payers are mostly private, though some countries have more government involvement than others. However, the multi-payer insurance is strictly controlled: no profit; cost controls; regulated services and fees. Funding comes via contributions from employers and employees and, in some countries, taxes on income. By and large, insurance companies must accept everyone and may not deny payment for medically necessary treatment. Present day Germany, Japan, France, Belgium and Switzerland use some version of this approach.

The Beveridge Model – William Beveridge influenced the establishment of Britain’s National Health Service. Under this system, health care and coverage are financed and provided by the government through taxes. Most hospitals are government-owned and most doctors are government employees. Medical care is a public service. Everyone is covered and the efficiency of one payer saves money. Great Britain, Italy, Spain, most of Scandinavia, Hong Kong and Cuba use some version of this approach. So, too, do the U.S. Department of Veterans Affairs and the U.S. military.

The National Health Insurance Model – This design is a combination of the Bismarck and Beveridge models. This system relies on a public payer and private providers. Everyone pays into a public fund which pays the private providers. The government collects the money and pays the bills. Money is saved due to the efficiency of one payer and the lack of marketing and other costs. Everyone is covered for all medically necessary treatment. Canada and Taiwan use some version of this approach.

The Out of Pocket Model – Under this model, the patient is responsible for paying the health care provider directly for all costs incurred. Many countries, mostly poor and loosely organized, fail to provide a system that guarantees health care coverage. In the Out of Pocket model, according to Reid, “The rich get care. The poor stay sick or die.” The rich, members of the military, and government officials get care; others do not. Much of Africa and parts of South America and Asia use this approach. It is interesting to note that T.R. Reid tells us that 17% of U.S. health care spending is out of pocket.

How We Can Go to the Head of the Class

T.R. Reid concludes, “All developed countries…provide health coverage for every resident, old or young, rich or poor. This is the underlying moral principle of the health care system in every rich country—every one, that is, except the United States.”

How, then, do we go about changing that? We already have a system in this country that is an example of the National Health Insurance model of publicly funded, privately provided health care—Medicare. By expanding it to include all of us in the system and by improving it to include prescription and other coverage, economies of scale make this an efficient and humane approach. We can achieve the important components of a good health care system: coverage, quality, cost, and choice. It covers everyone; outcomes would improve by virtue of universal coverage; current costs would be reduced via savings in marketing, lobbying, and multi-million dollar CEO salaries; patients will have complete choice of health care providers.

As we mentioned earlier in our reference to federal legislation currently under consideration, coverage in that legislation will not be universal. It is time that we decide to achieve what has eluded us for so long. Given the climate in Washington, the best way to accomplish this is to get on board the single-payer (improved Medicare for all) effort here in Pennsylvania. The Family and Business Health Security Act (SB400/HB1660) offers all Pennsylvanians a publicly funded, privately provided system. It covers everyone, reduces costs, and gives residents comprehensive coverage with complete choice of health care providers. With the successful implementation of this system in Pennsylvania, we can be the model for the nation.

When this model is adopted nationally, it finally will accomplish what other developed nations have long enjoyed—universal, affordable health care coverage that removes the specter of medical bankruptcy. That’s when the U.S. can go to the head of the class.

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