How Health Insurance Works Around the World

As supporters and opponents of the new American Health Care Act debate the best way to overhaul a clearly broken healthcare system, it’s can be helpful, for just a moment, to look at American medicine from a global perspective.

In the United States, the majority of Americans get health insurance from an employer. A small percentage are insured through a government program like Medicare, Medicaid, or the Veterans Affairs health system, but most of us get our insurance from our jobs, not the government. In most other developed countries, however, healthcare works very differently. In fact, by some standards, our access level to healthcare looks very antiquated. Continue to learn how healthcare works in most other countries, and how the United States compares.

Free Healthcare for All…Sort Of

In countries like Canada, the United Kingdom, and even Cuba, every single citizen has access to healthcare through a nationally funded system. This guarantees that everyone from the poorest residents to the wealthiest titans of industry have access to medical care when needed.

Of course, they do have to pay for it somehow, and that generally comes from higher taxes. But what they get in return is quite remarkable. If a Londoner gets sick and needs an extensive hospital stay, it will cost precisely zero. There is a cashier at many hospitals in the UK, but they only operate to reimburse hospital guests who paid for a taxi to get to the hospital quickly. There is no real charge for any medical care at a doctor’s office or hospital.

Higher Income Taxes and VAT Taxes

The Scandinavian countries in Northern Europe are known to have some of the most generous public assistance programs in the world. These extend beyond healthcare to include government paid maternity and paternity leave and much more. These public assistance programs, which include healthcare, require high taxes.

Norway, which offers free healthcare for young people up to sixteen, charges an annual “deductible” entitling citizens to free healthcare for the year. But to pay for it, Norway charges one of the highest tax rates in the world. Income taxes reach as high as 55% for individuals and a Value Added Tax, or VAT, of 25% is added to luxury and high-end purchases to make up the difference.

Private Health Insurance Is Optional

One of the biggest complaints about national healthcare systems is wait times for non-urgent medical care. Wait times can be months for some treatments and surgeries, but that does not mean there aren’t other options.

For example, while everyone in England can get free healthcare through the National Health System, private insurance companies are available for wealthier residents who do not want to wait for free care. They can pay a private, for-profit company for insurance just like we do in the United States. About 10% of the British population opted to pay for private insurance that starts around $40 per month, well below the United States average $235 per month.

Longer Waits but Great Care

While there are longer wait times in some countries, that is not a death sentence. In fact, life expectancy in the United States is nothing to brag about. We are closer to being on par with Mexico than the healthiest countries. The United States is the only country in the Organization for Economic Co-operation and Development (OECD) without universal healthcare, and that makes us less healthy.

Statistics show that while there are long lines in Canada for some healthcare, the overall patient experience does not suffer. While the United States spends more on healthcare per person than virtually any other country, our health is not much better for it.

America’s Healthcare Future

The Affordable Care Act, sometimes called Obamacare, was a highly controversial topic in the 2016 election. President Trump and Republican leaders in Congress have vowed to repeal the landmark healthcare law, even though only 26% of Americans support such a move.

This leaves the future of American healthcare in a precarious position. We don’t really know what the future holds. No one knows if we will see universal healthcare in our lifetimes, or if we’ll see a rollback to a system that looks more like what we had in the 1990s. But around the world, every single resident of the most developed countries gets to go to the doctor. More than 30 countries offer some form of universal healthcare. With improvements in laws, science, and technology, universal healthcare may be in America’s future too. Only time will tell.

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