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What does “national health insurance” mean?

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  • National health insurance is a statutory requirement and is legally enforced in the countries that choose to implement it.
  • The entire legal population of a nation is ensured against the costs of health care.
  • National Health Insurance can be administered by either the public or private sector, or some combination of both.

In the wake of continued discussions about health care reform, national health insurance has once again entered into the conversation.

America has long resisted calls for such a scheme, as the private marketplace is deemed to be the more appropriate place to handle matters related to medical care. That being said, few would argue that the current system in America is fractured and broken. As such, national health insurance is once again a part of the discussion, even if it is not yet being seen as a serious alternative.

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National Health Insurance Explained


Commonly referred to as statutory health insurance by government regulatory, a national health insurance scheme is designed to me a legally enforced manner of ensuring that the entire population receives health care. It is meant to insure the population against any costs typically associated with medical care. The way that the program is funded can vary from nation to nation, depending on the particular type of program that is implemented. Some rely on the public sector to administer health care, others focus on the private sector, while still others combine the two in one way or another.

It is important to note that national health insurance does not necessarily mean that the entire health care system is run by the government, nor does the government have to finance it in its entirety. The scheme is usually set up and established via some type of federal legislation, often taking the shape of an entire reform of the existing system. Two of the more commonly cited examples are the Medicare system in Australia and the National Health Service in the United Kingdom.

Under both of these systems, general taxes paid within the country go to fund the system. These taxes are not optional, even though individuals are free to choose and pay for a private health insurance carrier if they so desire. Under both systems, however, the majority of the citizenry has chosen to join the national health insurance scheme since they are already paying for it.

Where does the concept of national health insurance come from?

It is commonly accepted that the first instance of a national health insurance system dates back to Germany in 1883. This was referred to as Otto von Bismarck’s Sickness Insurance Law of 1883.

The National Health Insurance of 1911 in Britain was not far behind. This was the first system to actually include a nationalized plan for delivering primary care, even though specialist and hospital care was not included. The system was initially designed to cover roughly one-third of the population.

Most working class adults were covered, but their dependents were not. This type of national health insurance remained until the National Health Service was established in 1948. This again was the first of its kind, as it created a universal health service that was funded out of the general tax fund in the country, as opposed to coverage based on insurance alone. Health care has since been available to all legal residents of the country.

Varying Types of Programs


Over the years, different countries have implemented their own versions of national health insurance. Each program differs in terms of how they are funded and how heath care services are actually provided to the population.

Canada, for example, has implemented a funding mechanism where the payments to the system are made by the government from money collected via tax revenue. France, on the hand, also has a system of mandatory contributions to the national health insurance scheme, but the collection itself is actually administered by several non-profit organizations that have been established just for that purpose.

Some countries have implemented an alternative approach to funding, where individuals are required to contribute to one of a series of competing insurance funds. These funds are required to provide a minimum level of coverage to each individual, and no discrimination is permitted on the basis of age, occupation, or prior health conditions.

In order to protect both patients and insurance providers, the government will create a system of equality designed to spread the risk out among the various insurance funds.

The following countries currently have some system of national health insurance in place:

  • Australia
  • Belgium
  • Germany
  • Ghana
  • Colombia
  • Japan
  • France
  • South Korea
  • Switzerland
  • Taiwan
  • Nigeria
  • Canada
  • Germany
  • Phillipines
  • United Kingdom

Perceived Advantages of National Health Insurance


The most common type of national health insurance discussed in the United States is based on a single-payer system. This has the government controlling the financial aspect of health care services throughout the country, but the actually delivery of the medical care is placed under the control of private entities. The common sentiment is that this is only way to gain true efficiency in regards to equally distributing quality medical care to everyone in the country.

America currently spends more on health care related services than any other industrialized nation in the world. Even given that, there are still an estimated 45 millions Americans that do not have health insurance.

National health insurance is commonly seen as a way of reigning in skyrocketing health care expenses and eliminating companies that only provide limited coverage to a growing number of individuals. There are also issues associated with long-term care that are addressed by a national health insurance scheme.

Over time, countries that have a national health insurance system have seen a reduction in the cost of medical care. Many nations have also reported an elimination of the wasteful and costly bureaucracy that is often associated with the health care system, while providing all citizens with the preventative and comprehensive medical services that they deserve.

Perceived Disadvantages of National Health Insurance


The citizens of many nations, America included, have had a long held independent attitude when it comes to health care. In fact, it is viewed more as a private and individual responsibility than it is a government obligation. Because of this, government intervention into the health care sector is regarded as limited, which has precluded a national health insurance system from developing up to this point.

The capitalistic nature of the health care system in America has long precluded itself from any type of national health insurance scheme. Individuals are responsible for their own medical care, the quality of which is generally commensurate with one’s ability to pay.

As health care costs continue to spiral almost out of control, many nations are beginning to take a serious look at national health insurance. There are advantages and disadvantages to this, as no system is perfect. The reality is that the citizenry needs to have some level of basic health care, but the extent to which the population is willing to accept government intervention in this area is still a point of contentious debate.

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