Universal Health Care 101

We have heard a multitude of controversy and speculation on Universal Health Care. During the elections, President Obama pledged to have implemented Universal Health Care by the end of his first term. With the excitement of debates, elections and the presidential inauguration behind us, it is now time to focus on what our new President has planned for health care reform. With the President's first term officially underway, many are now wondering exactly what Universal Health Care means for us individually and as a nation. Many are also wondering who will benefit from the program and who will be at a disadvantage as a result of the program. Here's the skinny on President Obama's health care reform.

An niversal Health Care system will allow families experiencing financial hardships and those with pre-existing conditions to obtain affordable health insurance plans. While insurance companies may not be looking forward to the additional completion that the President's plan will offer, families and individuals will benefit from the added competition as insurance companies will be more motivated to offer more affordable prices and more quality services.

Whether or not large employers will perceive this system as a benefit depends on which way you (or they) look at it. Under the new plan, all large employers will be required to contribute a certain amount (or percentage) towards employee coverage or towards the cost of an employee obtaining coverage on their own. Large companies that do not meet these standards will be required to contribute a certain amount (or percentage) to the national plan. On one hand, some employers will be required to contribute more than desired to employee health coverage. On the other hand, these same employers could greatly benefit from improved employee health as many studies in the last decade have shown that employee productivity increases with improved employee health.

An act banning Medicare from negotiating prescription drug discounts with pharmaceutical companies enabled an $8 billion profit increase just six months after it was put into effect by President Bush in 2003.⁽¹⁾ This ban will be lifted and the national plan will heavily utilize the use of generic drugs. This is a bonus for patients who for whatever reason, continue without prescription plans and those with prescription plans that do not cover the cost of brand name drugs. Pharmaceutical companies however, will feel the financial sting from the restrictions placed on preventing them from monopolizing certain prescription drugs by blocking generic drug manufactures from entering the market.

While the United States has yet to have implemented a Universal Health Care program, this is not a new concept. Many developed (and wealthy) countries already have Universal Health Care programs in place. The degree to which a government is involved in direct management of their system varies by country. President Obama's plan includes improvements our current health care system such as requiring insurance agencies to grant eligibility regardless of pre-existing conditions and requiring large employers to offer employees "meaningful coverage or make a meaningful contribution to the cost of quality health coverage for their employees"⁽²⁾ or contribute a percentage to the national plan and other improvements. An additional component called a National Health Insurance Exchange made up of approved private insurance options and a new public health plan will be added.

Hefty health plans come with hefty price tags right? Obama's plan will cost an estimated $50 - $65 billion. To pay for the initial investment required to implement such changes, President Obama plans to allow the current tax cuts for those making over $250,000 to expire. In addition, the President's plan is expected bring about considerable savings in the health care system. Although nearly 46 million Americans are uninsured, the United States spends more on health care than other industrialized nations, and those countries provide health insurance to all their citizens.⁽³⁾ One way Universal Health Care will bring savings to the health care system is by ensuring that all Americans are eligible for health care allowing them access to more preventative care. Preventative care lowers costs by using allowing physicians and patients to prevent the need for the costly treatment of chronic diseases. As mentioned during the debates about 75% of health care dollars is currently spent on the treating patients with chronic conditions. Also, let's not forget any contributions made by large employers failing to offer employees meaningful coverage or a meaningful contribution to the cost of quality health coverage.

^{1 Committee on Oversight and Government Reform (September,2006) Analysis Pharmaceutical Industry Profits Increase by Over $8 Billion After Medicare Drug Plan Goes Into Effect.}

^{2 Obama for America (n.d.) Barack Obama and Joe Biden's Plan to Lower Health Care Costs and Ensure Affordable Accessible Health Coverage for All.}

^{Carrie Budoff Brown (January 21, 2009) Obama to Host Meeting On Healthcare.}

^{3 National Coalition on Health Care (n.d.) Health Insurance Costs.}