Universal Health Coverage: The Promise of Definite Results in an Indefinite World
By Jeremiah Norris
In the run-up to the Affordable Care Act (ACA) in 2010, there was frequent comment across media channels that the United States was the only developed country that didn’t have a universal health coverage system. The British National Health Service (NHS) was mentioned as a template and presented as a cohesive, single payer-system which provided comprehensive services, free at point of service. Though it underwent vast changes, its original moment was held in amber by the same media outlets which declined to mention how the NHS had progressed into a pluralistic system reflective of its contemporary environment. If US policy-makers had taken note, they would have understood that what is enacted today can be dramatically altered tomorrow by emerging societal imperatives.
During the premiership of Margaret Thatcher, 1979-1990, the government established the “internal market,” in which these reforms were enacted:
- the NHS can purchase care for the citizenry from independently-run hospitals;
- inefficient hospitals can be driven out of the NHS system due to competition;
- private chains now run more than 100 hospitals that were formerly NHS;
- General Practitioners, dentists, etc. now bill their private services to the NHS;
- patients are assessed co- payments at points of service, e.g., optometry, etc.;
- and, there must be competing bids on specific NHS services.
The British Union Provident Association (BUPA) puts to rest the notion that NHS is a single payer system. BUPA, a private health insurance carrier and provider of healthcare services, now enrolls 23% the British population. Although this cohort can opt out of the NHS, they nonetheless continue to pay general taxes for its support. In effect, the NHS is used by BUPA members as a secondary carrier, often for high-end catastrophic care.
A significant portion of the U.S. population is already in a single payer system, e.g., Medicare (52.3m), Medicaid (57.5m), and the Veterans Administration (8.8m), for a total of 118.6 million patients, consuming some 48% of national health expenditures.
Two key drivers of ACA were the 47 million that were uninsured, and pre-existing conditions. In 2012, the Federal Poverty Level (FPL) was $23,050. The FPL doesn’t include the value of food stamps, nor subsidized housing, education and healthcare. The Kaiser Family Foundation determined that 11.3 million were at the 250% – 400% of FPL. For whatever reason, they choose not to purchase health insurance. In many cases employer-sponsored health care was offered at their places of work but they declined to pay a portion of the monthly premium. Of the 35.3 million at the 100% – 249% of FPL, many were eligible for Medicaid but failed to enroll due to stigma, a reluctance to fully disclose their assets, or simply not knowing that they were eligible for its benefits.
On pre-existing conditions, this country faced a similar problem with immunizations more than two decades ago. There is no vaccine that is 100% free of adverse reactions by an extremely small cohort of those being immunized. This led to many highly expensive legal court cases, forcing several US vaccine manufacturers out of business.
In 1988, the National Childhood Vaccine Injury Act created the National Vaccine Injury Compensation Program (VICP). It is a no-fault alternative to the traditional tort system of resolving vaccine claims that provides compensation to people found to be injured by certain vaccines. The U.S. Court of Federal Claims decides who will be paid. It is funded by a $0.75 tax on single dose vaccines and Trivalent vaccines are taxed at $2.25.
Pre-existing conditions represent an issue that could have been addressed in the same manner as vaccine injuries by building on the 35 states that now run High Risk Insurance Plans for persons that cannot otherwise buy this form of insurance. A national risk pool could be formed, one that removes the expensive tort system from the fiscal liabilities associated with adverse outcomes. Every health policy could carry a tax that is assessed at points of service to cover pre-existing conditions, with the government serving as the payer of last resort for catastrophic care.
Programs enacted by one Administration tend to be changed by political imperatives in follow-on Administrations. When Social Security was enacted in 1935, and Medicare in 1965, they were designed for a specific population group, mainly those aged 65+. During subsequent Administrations, key amendments were enacted through Social Security: 1) Disability Insurance; 2) Supplemental Security Income; 3) End Stage Renal Disease; and 4) Medicare Prescription Drug Benefits. Millions of deserving beneficiaries enter these programs well under the age of 65, some as infants.
Now, it is posited that entitlement programs like SS and Medicare, have to be reformed due to future unfunded liabilities–without thought to the fact that had they sustained their original purposes, then these institutions would be solvent into the foreseeable future.
In a similar fashion to the NHS which promised definite results in 1948, the ACA will soon encounter an indefinite world of political expediency by future Administrations. As in the past, their choices to continue any previously funded program will be limited when faced with uncharted obligations. They will have to raise taxes, mainly through increased premiums or higher deductibles and co-pays, or reduce benefits—usually both.