Chemplanikal 1

Joyce Chemplanikal
Semester Term Paper
Fleming: HMGT4301 Healthcare Management
December 6, 2013

The American Health Care System and Universal Health Care

The American healthcare system is one of the most unique in the world. Whereas most
countries follow a universal coverage plan Americans face a multi-payer system. The
American health care system is made up of multiple groups and many government programs
to provide citizens with health care. America spends most of its GDP on health care yet other
countries have better life expectancies. Not only that, but millions are still not covered in the
current U.S. health care system. Universal health care has been a well adopted plan in many
other countries and might have the answers to some of the problems America is facing. The
American health care system compared to universal health care has many interesting points.
As of now, the American health care system is a leader in medicine but not covering all of its
citizens; many cases have shown that America could benefit from a universal health care plan
that would protect its citizens and boost the economy by making health care accessible to all.
The American healthcare system is the center of much polarizing debate. On one hand
America is a leader for medical technology while on the other hand the system is considered
inefficient. In order to explain the opinions the system itself must be discussed. The health
care system is divided into the private and public sectors. The public health insurance sector
includes Medicare, Medicaid, and other public systems like S-CHIP. The private sector is

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much more dominant including employer-sponsored insurance and private non-group
(individual) markets. As of now the financing for the U.S. healthcare system is considered a
multi-payer system because the two functions of collecting money and reimbursing money is
shared by the private insurance companies and the government. Individuals pay for taxes,
businesses pay for premiums, and then there are the direct payment s to a provider for health
care services. The government then uses money generated from taxes to reimburse providers
who take care of patients enrolled in these programs (Chua). The government will spend the
tax money collected to pay for programs such as Medicare and employee premiums. There is
also a tax subsidy that is a major cost to the government where employers can deduct health
insurance benefits as a cost they will not have to pay taxes for. Private insurers accept
premiums and reimburse providers. When considering the percentages, in 2002, government
expenditures accounted for 44.9% of healthcare costs in the United States, and private
expenditures accounted for the remaining 55.1%. The U.S. spent $1.7 trillion on health care
expenditures in 2003the majority went to hospital care and physician/clinical services
(Chua). There are many problems facing the countries health care system.
Right now the average premiums are higher than ever, and most citizens receive
employer-sponsored health insurance because individuals who choose to pay for the
premiums on their own cant afford the outrageous costs. Understanding the facts about just
how hard it is for the average American to receive health care on their own explains why so
many people cant get the medical attention they need. In fact, 46 million people in the
country dont have the health insurance (Friedman). As a consequence the American
taxpayers have to pay the medical bills of those without insurance that arrive at the emergency
room in their most critical state of health. This causes hospitals to lose money. The

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government spends so much already for new technologies and medicine; so when instances of
people who cant pay are treated the premiums for insurance increases. Over time, we see that
the United States, not only spends more per capita on health care, but also has had one of the
highest spending growth rates (Snapshots). Looking at the GDP devoted to health care
spending shows that the United States grew from 9% of GDP in 1980 to 16% of GDP in
2008 (Snapshots). Clearly the U.S. is devoting a high level of spending to the health care
without substantially better results than other countries since many of the citizens arent
getting proper treatment and costs are high.
There are disagreements between the political parties about the current health care
system and its future as well. Republicans are satisfied with the current system but Democrats
believe the system is in need of improvement. Republicans focus on the fact that the U.S. is a
leader in high-end procedures and equipment. Democrats argue that these benefits come at the
price of a monetary cost that far exceeds other countries. America has the most complicated
health system with the highest administrative costs and the actual health care delivered to a
large segment of the population is very poor (Barlett). The U.S. is known for such high
spending because this country pays the most for its doctors. Other factors for its high cost are
the complexity of the system which has more paperwork, more plans, and more overlapping
programs.
The Times presented the new Obama care plan that shows that there is hope with
reform bills that will allow individuals to buy their own policies and protect themselves as
well as the economy. This reform would be a mandate where individuals would have to
purchase health insurance. By doing this hospitals wont lose money from attending to
uninsured patients as they do now since everyone is included in this new health care system.

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The Patient Protection and Affordable Care Act (also part of Obama care) creates a
requirement that insurance companies will not be able to drop customers when they are sick
and provide screening tests so patients can prepare and hopefully prevent fatal diseases early.
There are a few issues with this plan as Randy Barnett who opposes this plan state, the
federal government has never required every American to enter into a contract with a private
company and that doing so would lead to Congress able to mandate anything (Freidman).
Some argue the mandate violates the constitution. Perhaps these kinds of laws are necessary
however to improve the system.
Compared to other countries, the US should be one of the leaders in health care
services and should be covering all of its citizens because of all the money spent in health
care. Of the OECD (an organization of industrialized countries) the U.S. spent the highest
percentage of GDP comparing a 15% GDP to an average of 8.6% of other countries (Chua).
Excluding the U.S., most countries have the public sector accounting for the GDP as the main
source of health funding. Other countries also have high life expectancies and lower infant
mortality rates. These countries are under a universal health care plans that gives every citizen
health care coverage. Comparing both systems allows a different perspective on how health
care can be improved.
Universal health care is a state in which all residents of a geographic or political
entity have their health care paid for, regardless of medical condition or financial status
(QuickOverview). Within this there are three different implementations: single payer health
care, hybrid health care, and private universal health care. These different implementations
account for the capitalistic or socialistic construction. The single payer health care system is
when the government (one group) pays for the health care of everyone with tax money. The

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hybrid health care does not have the government pay in full so that there can be more access
and be less expensive. The private universal health care requires the government to supply
some health care but mostly keep a free market to keep costs down. There are different
adaptations to the models of universal health care to fit each countrys needs, but in the end all
the models would still give coverage to all. The funding for universal health care comes from
a mix of private and public contributions.
Universal health care has many benefits as well as consequences if it was ever
implemented. Although it would provide health care to everyone it would also instigate higher
taxes so that the government could pay for it. With questions about costs most physicians
object a universal health care system because it would lower wages. There are also arguments
that the absence of a market mechanism may slow innovation in treatment and research, and
leads to a rationing of care through waiting lists (QuickOverview). Even with these potential
risks however, many people are arguing for universal health care in America.
Universal health care is believed to promote economic prosperity in America if
implemented. The World Bank president, Jim Yong Kim, said, making health care more
accessible is crucial for combating poverty and spurring economic development (CulpRessler). The World Health Organization (WHO) is also pushing for universal health care
around the world to reduce the number of people who are impoverished by medical expenses.
They believe it is important to promote development because health has achieved
unprecedented prominence as a key driver of socioeconomic progress (The WHO Agenda).
Each year people fall into poverty because of expensive health care. Obama care is heading
towards the goal of reducing the number of uninsured who struggle to pay for their finances
by expanding Medicaid. Jim Yong Kim wants to push for even more expansion of health care

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and uses Japan as his prime example. Japan committed to universal health coverage when its
per capita income was not at the highest levelseconomists believe that move ended up
strengthening the countrys middle class (Culp-Ressler). Recently the U.S. has been facing
rising health care costs affecting not only the low-income Americans but the middle-class
citizens as well. It is imperative for the U.S. to protect its citizens and promote the economic
development it so desperately needs.
The case for universal health care in America focuses on the problems the citizens
currently face. Health care premium costs have been leading to over 45 million uninsured.
With the rising costs fewer employers can afford to provide insurance dropping from 69% in
2000 to 60% in 2005 (Casoy). The diminishing employer-based coverage has been somewhat
offset by increased enrollment in Medicaid. Medicaid is a program that supports the lowest
income Americas however it has had many cuts in multiple states. The states have been
stripped of cash and its congressional representatives are opposed to welfare programs which
only highlight the dilemma that many Americans are currently facing. Many of these
congressional representatives are driven by false beliefs. A common misconception is that the
U.S. cannot afford to cover the uninsured, when in fact a coordinated financing system is the
key tool for holding costs down, and there are affordable ways to do it (Light). Another
belief is that the only financing option is a single-payer system when in fact there are other
models. This issue is not limited to only a financial case however, there are other debates
about why a universal health care should be implemented.
Universal health care is considered a moral case in many countries. Other countries
have declared health care to be a basic right because it is considered a social or public good.
There are many statistics to support the implementation of a universal health care in order to

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protect citizens. One third of uninsured Americans reported they were unable to fill a
prescription drug in the last year, postponed needed medical care and went without a
physician-recommended medical test because of the cost (Casoy). Many resort to waiting till
an emergency room visit to get medical attention. These behaviors affect the prognosis of the
disease process. If these Americans had been able to get the care they needed they could have
caught the disease early and potentially save their life. In fact, adults are 50% more likely to
receive preventative care if they could afford it and 1.5 times more likely to not be diagnosed
late for cancer (Casoy). With all these risks people become disabled because of their lack of
access. The dimension of human suffering is vast in this country because so many go without
the care they need. Many fall into bankruptcy because they receive medical care too late and
use all their savings to just barely save their own lives. This kind of treatment has been seen
as inhumane and is a strong case for America to finally give universal health care.
The state of Vermont has chosen to be the experiment which may lead to a nationwide
health insurance reform. Lead by Governor Peter Shumlin, the state of Vermont will
implement the first true single-payer, universal health care system (Vermont). Known as
Green Mountain Care it is the first to stand by the universal health care message that health
care is a right and not a privilege. This program has a goal to implement the single payer
model with a cost-saving measure. This plan would create fixed budgets for providers and
avoid monetary incentives for over-provision services so that more citizens can be insured.
Signed into law on May 2011, Vermont is expected to be in full operation by 2017 and finish a
three-phase process. This program appeals to both Democrats and Republicans and has the
potential to solve many of Americas current issues in health care. There is a possibility that

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America will follow in the footsteps of other countries and finally bring the needed medical
attention to all the people who need it.
Health care affects every individual in the world. As Americans are faced with the
current political battles and rising health care costs, many are unable to reach doctors for the
medical care they need. The system may be a leader in medical technology but fails to provide
this with many of its citizens. Complexity in the system has led to excess spending and lower
life expectancies compared to other countries who provide health care to all. Universal health
care has proven to lead to economic stability that the U.S. needs. Not only this, but the
uninsured Americans are suffering and becoming bankrupt trying to pay for medical services.
The universal health care system can adapt to fit Americas sociological and economic needs.
As of now there are steps towards providing health care to all with plans such as the
Affordable Care Act. As time progresses there may be a necessary shift to universal health
care to boost the American economy and promote health.

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Works Cited
Barlett, Bruce. "How America's Health System Stacks Up Against Other Developed
Countries." Yahoo Finance. The Fiscal Times, 15 Nov. 2013. Web. 06 Dec. 2013.
<http://finance.yahoo.com/news/america-health-system-stacks-against091500353.html>.
Casoy, Flavio. "The Case for Universal Health Care." AMSA.org. AMSA, 2008. Web. Dec.
2013.
<http://www.amsa.org/AMSA/Libraries/Initiative_Docs/CaseForUHC.sflb.ashx>.
Chua, Kao-Ping. "Overview of the U.S. Health Care System." AMSA.org. AMSA Jack
Rutledge Fellow, 10 Feb. 2006. Web. 1 Dec. 2013.
<http://www.amsa.org/AMSA/Libraries/Committee_Docs/HealthCareSystemOverview.
sflb.ashx>.
Culp-Ressler, Tara. "The World Bank Pushes For Universal Health Care In Every Nation By
2030." ThinkProgress RSS. Center for American Progress Action Fund, Dec. 2013.
Web. 06 Dec. 2013. <http://thinkprogress.org/health/2013/12/06/3029931/world-bankuniversal-health-care/>.
Friedman, Milton. "A Way Out of Soviet-Style Health Care." The Wall Street Journal. Dow
Jones and Company, 20 Mar. 2010. Web. 2 Dec. 2013.
<http://online.wsj.com/news/articles/SB10001424052748704784904575111273624979
544>.
Light, Donald W. "Universal Health Care: Lessons From the British Experience." Promoting
Public Health Research, Policy, Practice and Education. American Public Health

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Association, Jan. 2003. Web. Dec. 2013.
<http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1447686/>.
"QuickOverview." Universal Health Care. QuickOverview, 2011. Web. 06 Dec. 2013.
<http://www.quickoverview.com/issues/universal-healthcare-system.html>.
"Snapshots: Health Care Spending in the United States & Selected OECD Countries The
Henry J. Kaiser Family Foundation." Health Costs. Kaiser Family Foundation, 12 Apr.
2011. Web. 02 Dec. 2013. <http://kff.org/health-costs/issue-brief/snapshots-health-carespending-in-the-united-states-selected-oecd-countries/>.
"The WHO Agenda." WHO. World Health Organization, 2013. Web. 05 Dec. 2013.
<http://www.who.int/about/agenda/en/index.html>.
"Vermont Wants to Be the First State With Universal Health Care." PolicyMic. Mic Network
Inc., 29 Oct. 2013. Web. 06 Dec. 2013.
<http://www.policymic.com/articles/70549/vermont-wants-to-be-the-first-state-withuniversal-health-care>.