National health insurance

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National health insurance is a form of health insurance that insures a population against meeting the costs associated with ill health.

Some countries implement national health insurance through taxation and/or by legislation requiring compulsory contribitions to a national insurance fund operated by the government from which medical expenses provided by private entities (doctors and hospitals). This is known in the United States as single-payer health care. An example of this is Medicare (Canada).

Some countries implement national health insurance through taxation and/or by legislation requiring compulsory contribitions to a national insurance fund operated by government, but the money can only be spent on health services commissioned by government. This is referred to pejoratively by some in the United States as socialized medicine and in other countries merely as publicly funded medicine. An example of this is the UK's National Health Service.

Some countries implement national health insurance by legislation requiring compulsory contribitions to competing private insurance funds. These funds must provide a minimum standard of coverage and are not allowed to discriminate between patients by charging different rates according to age, occupation or previous health status. To protect the interest of both patients and insurance companies, the government establishes an equalization pool to spread risks between the various funds. Thus a fund with predominantly younger, healthier patients pays into the pool, but a fund with older, sicker patients may receive from the pool. The government may also contribute to the pool as a form of health care subsidy.

Other countries are largely funded by contributions by employers and employees to sickness funds. So, funds do not come from the government, and neither from direct private payments. This system operates in many European countries such as Germany and Belgium. These countries have so-called Social health insurance systems, characterized by the presence of sickness funds, which can be based on professional, regional, religious, or political affiliation. The Netherlands recently moved from a Social health insurance system to a more private insurance system. Usually characterization is a matter of degree: systems are mixes of these three sources of funds (private, employer-employee contributions, and national/sub-national taxes). (Saltman et al. 2004)

In addition to direct medical costs, some national insurance plans also provide compensation for loss of work due to ill-health, or may be part of wider social insurance plans covering things such as pensions, unemployment, occupational re-training, and financial support for students.

[edit] Further reading

Nicholas Laham: Why the United States lacks a national health insurance program, Westport, Conn. [u.a.] : Greenwood Press, 1993
Ronald L. Numbers (ed.): Compulsory Health Insurance: The Continuing American Debate, Westport, Conn. : Greenwood Press, 1982.
Richard B. Saltman, J. Figueras and R. Busse (eds) (2004) Social Health Insurance systems in western Europe. London: Open University Press / McGraw-Hill