By Susan Hutchinson.
The US healthcare model differs greatly from other countries and is a hotly debated topic. Advancements in diagnostic testing and treatments have driven costs up significantly forcing insurance companies to decide how much they are willing to cover and increase out of pocket expenses for participants in order to remain profitable. Necessary medical services are cost prohibitive for almost all uninsured Americans.
National Health Service (NHS)
Outside the US many countries implemented government managed national plans to guarantee healthcare for all with no qualifying criteria; everyone is covered for everything. The NHS in the UK is one example of this type of system. Although wait times for non-emergency surgery or some diagnostic tests can be up to several months, knowing the patient does not have to find creative ways to pay for it makes it worthwhile. The NHS is 98.8% funded through general taxes and contributions from National Insurance (NI) through payroll deductions.
The UK does have its challenges to continue funding the NHS. An aging and increasing population means more money is needed to continue in its present state. Implementation of cost containment initiatives, in addition to raising taxes and increasing contributions from NI are needed to ensure continued coverage for all.
US Healthcare Options
Until recently, Americans who did not have employer/union benefits, were too young for Medicare or did not meet the income levels for Medicaid were at the mercy of insurance companies who could deny coverage or charge high, mostly unaffordable, premiums. Millions of people were uninsured until the introduction of the Patient Protection and Affordable Care Act (ACA) in 2010. Implementing the ACA resulted in an additional 20+ million insured Americans (2017). ACA subsidies make premiums affordable for older or lower income people; however, pricing may not be much lower outside of the exchanges for participants with low or no subsidies, making the ACA not necessarily affordable for all. The Affordable Healthcare Act (ACHA), proposed as a replacement for the ACA, changes some ACA mandates or puts the burden for management at the state level instead of the federal, which would make state-to-state variability for costs and coverage even more diverse and possibly unsustainable in some states.
The table below compares key points of NHS, ACA and AHCA coverage. The reference used for ACA and AHCA can be found here.
[trx_table style=”2″ size=”medium” top=”10″ bottom=”10″ left=”0″ right=”0″]
|Plan Funding||General Taxes/Employee Payroll||Participant/Government Subsidies||Participant/Government Subsidies|
|Low Income Funding||N/A||Medicaid: Federal funds dependent on state cost of care, expansion to adults without children in 30 states||Medicaid: Fixed amount, annual increase based on inflation, defunding of expansion by 2020|
|Additional Cost for Outside Region/State Services||No||Yes||Yes|
|Higher Premiums for Older Participants, Sick or Women||N/A||No for sick or women, up to 3 times more for older participants||No for women, state decision for sick and up to 5 times more for older participants|
|Annual or Lifetime Limits||No||No||Not guaranteed, state regulated|
|Uninsured Penalty||No uninsured||Yes (annual tax)||Yes (30% premium surcharge >2 months)|
|Basic Benefits Guaranteed||Yes||Federal mandate||Not guaranteed, state regulated|
|Age/Annual Income Criteria to Participate or Receive Subsidies||N/A||Must be <65, income between 100% and 400% of poverty line, applied to monthly premium with max of $48K||Must be <65, subsidies up to $75K with tax credits based on age not income or local cost of insurance|
|Consumer Choice for Provider and Plan||N/A||Yes (state exchanges)||Unknown how exchanges will work|
|Required Coverage for Hospital, Mental Health and Prescription Drugs||Yes||Yes||Unknown|
|Women’s Health (maternity, pediatric, contraceptives)||Yes||Yes||Not guaranteed, state regulated|
|Dental Included||Yes (co-pay for services)||No||No|
|Increased Taxes for Insurance Providers or Medical Device Companies||N/A||Yes, taxpayers with income >$250K also taxed more||No, taxes are eliminated with tax cuts totaling $663 Billion over next 10 years|
*Birth control and some specialty free (NHS), tiered at variable costs (ACA/AHCA)
Note on South Carolina ACA
SC has one insurance provider in the exchange: Blue Cross Blue Shield (BCBS). Even with no competition the medical loss ratio (amount of premium dollars spent on health costs) was 88.5% in 2016, which is above the ACA guideline of >80%. This indicates BCBS in SC, unlike some other states, can still be profitable with the ACA.
Most agree the ACA is not for everyone and it remains to be seen what the current administration offers as an affordable replacement to the consumer, which does not exclude/limit based on age, sex or health status. Although California has recently proposed a single payer plan similar to the NHS, there are no plans, at this time, to look at it as a national plan.