The basics of this plan government run hospitals Government paying the bill Government is both provider and payer This is closest to pure socialized medicine Origins early 1940s. William Beveridge and Nye Bevan. Beveridge was on Churchill’s Social Insurance and Allied Services Committee. 1945 Nye Bevan a committed socialist was Minister of Health. Beveridge designed the plan, Bevan implemented it.
National Health Insurance Model Basic concept Private sector doctors and hospitals Government insurance plan Origins in Canada: Tommy Douglas child in Scotland who injured his knee before moving to Canada in the early 1900s. He received treatment only because he was selected to be the subject of a demonstration of surgical technique. He would later be elected Governor of Saskatchewan in 1944. He would then design and promote this single payer system that would cover everyone in the country by 1961.
The basics of this idea are Universal Coverage Private providers (Unions) Private insurance Government regulates coverage and prices Origins in Germany. Otto von Bismarck the Iron Chancellor unified the nation in the 1800s. January 1971 birth of the German Empire. He created his Sickness Insurance Laws in 1883. Why did he create these laws? Possibly benevolence. A program of applied Christianity. Possibly to undermine political support to left wing parties. Possibly to insure healthy young men for the military. In Germany competition among the sickness funds and pressure from government have lowered the price of health care, but costs continue to increase. This puts a squeeze on doctors.
Since the early twentieth century, health care in the United States evolved based on governmental meddling with the free market by advancing the interests of various stakeholder groups at the expense of others.
Lecture: Health Care Systems
Ronald F. White, Ph.D.
Professor of Philosophy
College of Mount St. Joseph
National Health Care Systems
• What is the “Ideal National Health Care System?”
– UNIVERSAL ACCESS
• A formal principle or abstraction
– Access to what?
» Wants v. Needs
– QUALITY OF HEALTH CARE
• What is “Good Health Care?”
– Individual v. Collective Measures
• Quality of what?
– Health care professionals, hospitals, drugs, biomedical technologies, laboratories, research institutions,
medical schools, health insurance
• Quality Sensitivity
– Availability of qualitative information
– Ability to act on qualitative information
• Quality as Comprehensiveness
– Number of products and services available
– Health Care Needs v. Wants
• Scientific Medicine
– Regulation of Research
– AFFORDABLE COST
• What is “Affordable Health Care”
– How much does it cost?
– How much is too much?
• Who Benefits and Who Pays the Cost?
The U.S. Health Care System
• In 2005, the Census Bureau reported that at least 44.8 million Americans were
without health insurance coverage.
– By 2006, that number rose to 47 million: a 15% increase in the number of uninsured.
– Since, 2000 the number of uninsured Americans has grown by 8.6 million: an increase of
about 22 percent. (Census Bureau 18).
– The largest segments of uninsured are employed, young adults 19-29 and older adults 45-64.
(Census Bureau, 21)
– The uninsured rate among young adults, signals a corresponding rise in the number of
uninsured young children.
– Global Measurement of Quality
• Life Expectancy : As of 2006 U.S. Ranks 38th
COMPARED TO: 1. Japan (82.6), 2. Hong Kong (82.6), 3.
• Infant Mortality: As of 2006 U.S. ranks 32nd
(6.3) COMPARED TO: 1. Iceland (2.9), 2. Singapore (2.9)
, Japan (3.2)
– Hamilton County, Ohio 13.9 (More than twice the National Average)
• Medical Mistakes
– Number and Quality of Products and Services
– Heroic Medicine and Enhancement
– Quality of Insurance Products
– In 2007, the Kaiser Family Foundation reported that the cost of providing health care in the
United States has grown from 7.2% of the nation’s economy in 1970 (or $356 per person per
year), to about 16% in 2005 (or $6,500 per person).
– This is nearly twice the cost of providing care in Canada ($3,161), France ($3,191.) and
Australia ($3,128.); and more twice as much as Japan ($2,358) and the United Kingdom
• Economic Reality
– Cost of Healthcare-
– Healthcare as Social Construction
• What is disease?
– Socialized Medicine Inefficiencies
• Reliance on experts
• Determination of a social minimum: what is basic healthcare?
– Wants become needs
• Moral Hazard-Overuse of the System
• Weak on Research-
– Free Riders on U.S. Research
– Market-Based Inefficiencies
• Imperfect Information- ”learned intermediaries”
• Imperfect Freedom-
• Imperfect Competition-
• Free Riders- no health insurance
• Emphasis on Disease rather than health
– Weak on preventative medicine
• Real World Systems: Mixed Systems
• Emphasize Comprehensiveness (Free Market)
– Healthcare is a Business: Free Market
• Maximize Private Enterprise
• Minimize Public Enterprise
• Maximize Private Charity
• Maximize Innovation
• Maximize Competition-
– Regulate Monopolies:
» Natural Monopolies
» Artificial Monopolies
– Licensure, Patents, etc
• Emphasize Universality (Socialized Medicine)
– Healthcare is a Public Good
• Welfare Liberalism
– Social Minimum
» Safety Net (needs v. wants)
• William Beveridge (England)
• Great Britain, Italy, Spain, Scandinavia, Cuba, and Hong Kong
• Health Care financed and provided by government via
– No medical bills, public service
– Most doctors are government employees
– Most doctors are private doctors collect fees from govt.
• U.S. Correlate:
• Military and Veterans, Indian Health Service
• Problems: High Taxation, Shortage of Specialists, Waiting
Lines, Patients may not be treated if the doctor deems
unimportant, Government (not price) rations health care
National Health Insurance
• Canadian System
– Canada, Taiwan, South Korea
– Single-Payer System
– Principles Governing Canadian System
• Public Administration
– U.S. Correlate: (Medicare)
• Individuals over 65
– Basic Problems: Waiting Lines, High Taxes
– Germany, Japan, France, Belgium, Switzerland, Japan
• Otto Von Bismarck (Germany)
– Universal Coverage
– Providers and Payers are Private
– Insurance Financed by Employers and Employees
• Non-Profit Sickness Insurance Funds
• Individual and Employer Mandates
• Price controls on medical services
– U.S. Correlate: Four-Party System
• Most working individuals under 65
– Basic Problems:
• Sickness Funds run out of money
• Doctors not highly compensated
• Perverse Incentives: Job-Lock, Job-Flight
• Countries without any Organized Health Care System
– Somalia, Afghanistan etc.
• Products and Services not covered by Countries with Health Care
– Treatments that address wants (elective v. necessary treatments)
• Cosmetic surgery, Sex change, weight reduction surgery etc.
– Treatments with marginal cost-benefit ratios
• Joint replacement surgery
– Dental care, psychiatric care, pharmaceuticals
– Illegal Treatments on the black market (Rhino Horn etc.)
• The United States
– Unemployed or Underemployed
– Uninsured with pre-existing conditions
– Exceed Lifetime Insurance Limits
• Contractual Exclusions
• Problems: Access to health care by the poor, inequality of quality
(the rich get better care).
Health Care Systems in the
• Decentralized Mixed System Based on Groups
• Four-Party System (workers)
– Bismarck Model
• Multiple Systems
– Federal Employees Health Benefit Program (employees of
– Medicare (elderly)
– Beveridge Model
– Medicaid (poor)
– National Health Insurance Model
– Veteran’s Medicine (veterans)
– Beveridge Model
– State Children’s Health Insurance Program (SCHIP)
– National Health Insurance Model
– Reauthorized in 2009
– Cobra Consolidated Budget Reconciliation Act COBRA (unemployed)
Questions for Discussion
• Why are all national health care systems
always subject to “reform?”
• Are comparisons between the U.S. health
care systems and European systems fair?
• Why do all health care systems struggle
with the conflict between “market justice”
and “social justice?”