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Health insurance is a type of insurance policy that provides coverage for a predetermined set of medical risks over a specified period.[1] A health insurance policy is an agreement between an insurance provider and an individual, wherein the provider commits to covering pre-determined medical expenses, while the individual pays a fixed monthly premium (which may vary depending on the terms of the agreement). Upon acceptance into this plan, the consumer becomes part of a risk pool, which is further categorized into low-risk and high-risk segments.[2] One’s risk assessment provides information regarding their propensity to need more medical services, and this directly correlates to the amount of premiums that would be paid by the person each month.[3]
Entering the 20th century, many countries adopted various insurance schemes with the goal of making basic healthcare available to all its citizens.[4] The complexities of healthcare insurance differ from country to country - in the United Kingdom the health insurance is publicly funded and operated (known as the NHIS).[5] In opposition is Switzerland, where there is a compulsory private health insurance system of funding.[6]
Advocates of public health insurance (also known as universal health coverage) generally do so under the theory that healthcare is a basic right.[7] It is believed that the government has a duty, not only to ensure the existence of healthcare services, but also to ensure all have access to those services. Respect for human dignity demands that no one refrain from seeking medical care from fear of the consequences of doing so, and that no one suffer financial adversity as a result of having sought care.[8] This notion directly ties into the funding mechanics of the public healthcare programs. In Canada, the public funded health insurance known as Medicare has a veneer of national pride and universal approval, which means the funding of the program through public taxation is accepted, even with rising costs.[9] In contrast, Switzerland employs a health insurance system where there is no publicly funded program.[10] Rather, all persons are required by law to have coverage under private insurance.[11]
The United States health insurance system is a hybrid form of these two approaches where public financed health insurance coexists with privately financed medical coverage.[12] Whilst Medicare is the single biggest insurance player and provides coverage for ages 65 and above regardless of income, it is very common to find private employers contribute to the premium payments of its employees in the form of group insurance coverage.[13] Medicaid is another important insurance program in the United States, focusing on certain poverty stricken individuals and provides long term care for close to 10% of the population.[14]
The ills of the United States hybrid healthcare system are commonly discussed, and there has been a major push in recent years for the adoption of universal basic coverage of the likes of Canada.[15] Despite the imperfections of existing health insurance systems, the universal healthcare movement gained significant momentum during the COVID-19 pandemic.[16] The pandemic required substantial funding increases for public-funded health insurance schemes. Additionally, private insurance companies took proactive steps, such as waiving out-of-pocket expenses for individuals hospitalized with COVID-19.[17] This decision was not made with altruistic intentions. The private healthcare industry experienced an almost 10% increase in insurance premium profit primarily due to the cancellation or postponement of operations and surgeries to prioritize resource allocation towards the containment of the COVID-19 virus.[18] The subsequent rise in premiums to cover new costs incurred post-COVID-19 exposed the substantial financial burden faced by employer-sponsored health insurance holders, prompting renewed calls for a unified national health insurance program.[19]
The ongoing political stalemate at the federal level regarding universal health insurance has prompted several states to commence implementing programs aimed at achieving genuine universal healthcare insurance with a single-payer system, thereby eliminating private health insurance.[20] For example, the state of Washington created the Universal Healthcare Commission in 2021 with the goal of establishing a universal healthcare system for all its residents.[21] The objective is to change the perception around health insurance and ensure that access to good healthcare is based on need, not the ability to pay. This mirrors the fundamental principle that guides the Canadian health insurance system.[22]
But there has been pushback to this approach – citing the inefficiency of government spending and regulation of the health sector in general.[23] Dr. Brian Day, an orthopedic surgeon in Vancouver, believes that both the United States and Canada should look to the Switzerland model, where private insurance is encouraged but the government steps in only when there is a demonstrated evidence the individual cannot pay their premiums.[24] Due to the competitive nature of private insurers, who prioritize price and service quality, this competition effectively mitigates healthcare inflation and inefficiencies, reducing the overall cost that has to be paid in the form of premiums.[25]
It remains uncertain what reforms to the healthcare system the United States should enact, along with the massive institutional changes necessary to affect any transition. Some argue that universal healthcare insurance regulations should be implemented at the state level rather than the federal government due to the magnitude of healthcare reform.[26] While these discussions continue, it is evident that a growing number of people believe the current hybrid healthcare system in the United States is inadequate at providing access to quality care, leading to a need for structural change.
Kwadwo Amponsah is a Staff Editor at CICLR.
[1] My Healthcare Finances, Health Insurance Introduction, My Healthcare Finances, https://www.myhealthcarefinances.com/health-insurance/health-insurance-introduction [https://perma.cc/Y6UD-TMVA] (last visited Mar. 8, 2025).
[2] Health Insurance 101, United Healthcare Student Resources, https://www.uhcsr.com/insurance101 (last visited Mar. 8, 2025) [https://perma.cc/J75P-B7BU].
[3] Id.
[4] Health Policy 101: International Comparison of Health Systems, Kaiser Family Found. (Oct. 2024), https://files.kff.org/attachment/health-policy-101-international-comparison-of-health-systems.pdf [https://perma.cc/8E43-2Z8S].
[5] Id.
[6] Nelson Schwartz, Swiss Healthcare Thrives Without Public Option, N.Y. Times (Sept. 30, 2009), https://www.nytimes.com/2009/10/01/health/policy/01swiss.html?pagewanted=all [https://perma.cc/ZYN4-533U].
[7] Tedros Ghebreyesus, Health is a Fundamental Human Right, World Health Org. (Dec. 2017), https://www.who.int/news-room/commentaries/detail/health-is-a-fundamental-human-right [https://perma.cc/8GQD-QJEE].
[8] Lawrence D. Brown, Comparing Health Systems in Four Countries: Lessons for the United States, 93 Am. J. Pub. Health 52 (2003).
[9] Danielle Martin, Ashley Miller, Nadine Caron, Gregory Marchildon, Bilkis Vissandjeé and Amélie Quesnel-Vallée, Canada’s Universal Healthcare System: Achieving Its Potential, 391 Lancet 1718 (2018).
[10] Schwartz, supra note 6.
[11] Id.
[12] US Healthcare System Overview-Background, Int’l Soc’y for Pharmacoeconomics & Outcomes Rsch., https://www.ispor.org/heor-resources/more-heor-resources/us-healthcare-system-overview/us-healthcare-system-overview-background-page-1 [https://perma.cc/D26B-HNB3] (last visited Mar. 12, 2025).
[13] Id.
[14] Nancy De Lew, George Greenberg & Kraig Kinchin, A Layman’s Guide to the U.S. Healthcare System, 14 Healthcare Fin. Rev. (1992).
[15] Liran Einav and Amy Finkelstein, Designing US Health From Scratch: A Proposal for Universal Health Coverage, Brookings Inst. (Oct. 2023), https://www.brookings.edu/articles/designing-us-health-insurance-from-scratch-a-proposal-for-universal-basic-coverage/[https://perma.cc/4MBY-BTPE].
[16] Governments Push for Universal Health Coverage as COVID-19 Continues to Devastate Communities and Economies, World Health Org. (Jan. 2021), https://www.who.int/news-room/feature-stories/detail/governments-push-for-universal-health-coverage-as-covid-19-continues-to-devastate-communities-and-economies [https://perma.cc/YMT9-CZJY].
[17] Ishira Shrivatsa, The Impact of COVID-19 Pandemic on Health Insurers, Fed. Rsrv. Bank of Chicago (Sept. 2022), https://www.chicagofed.org/publications/chicago-fed-letter/2022/471 [https://perma.cc/QSN7-BA5F].
[18] U.S. Health Insurance Industry Report, Nat’l Ass’n of Ins. Comm’rs (2021), https://content.naic.org/sites/default/files/inline-files/2020-Annual-Health-Insurance-Industry-Analysis-Report.pdf
[19] Lynn Blewett and Michael Osterholm, What’s Next for the U.S. Health Care System After COVID-19, 110 Am. J. Pub. Health 1365 (2020).
[20] Patrick Mazza, Moving to Universal Health Care, beginning in the States, Counterpunch (2024), https://www.counterpunch.org/2024/04/26/moving-to-universal-health-care-beginning-in-the-states/ [https://perma.cc/32Z9-8MFE].
[21] Universal Health Care Commission, Wash. St. Healthcare Auth. (2025), https://www.hca.wa.gov/about-hca/who-we-are/universal-health-care-commission [https://perma.cc/5KJ7-CTKK].
[22] Id.; Martin, supra note 9
[23] Laura Santhanam, How Canada Got Universal Health Care and What the U.S. Could Learn, PBS News (2020), https://www.pbs.org/newshour/health/how-canada-got-universal-health-care-and-what-the-u-s-could-learn [https://perma.cc/QNC7-AEKT].
[24] Id.
[25] Avik Roy, Why Switzerland Has the Best Health Care System, Forbes (Apr. 29, 2011), https://www.forbes.com/sites/theapothecary/2011/04/29/why-switzerland-has-the-worlds-best-health-care-system/ [https://perma.cc/F8ZP-EPY4].
[26] Mazza, supra note 20.
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