Financing Universal Health Insurance: Taxes, Premiums, and the Lessons of Social Insurance

Abstract

In a society with strong antitax sentiment and large government deficits, the enactment of universal health insurance is blocked by an impasse over financing. The two chief mechanisms for funding universal health insurance are taxes and insurance premiums. Taxes and premiums are not distinct entities; rather, a spectrum of financing methods exists with varying tax-like and premium-like features. Premium-like financing tends to be voluntary and earmarked for health care, with coverage contingent upon making payments and payments going to private insurance firms. Tax-like financing, in contrast, tends to be mandatory and not earmarked for health care, with coverage not dependent upon making payments and payments going to governments. Over the past century, most industrialized nations have developed highly popular social insurance programs to cover periods of retirement, disability, unemployment, and payment for medical care. Social insurance constitutes a blend of tax-like and premium-like features, offering lessons that might assist in breaking the current impasse over universal health insurance financing.

Is Universal Health Insurance Superior in Terms of Healthcare Payment? Estimating Financial Burden of Healthcare in Korea: 2009 to 2019

“…Korea’s National Health Insurance is adopted from the Japanese, which is rooted in Germany’s employment linked social insurance program. 5,6 The employees are enrolled in National Health Insurance through their workplace, and the self-employed or those who do not have a job are enrolled compulsorily as local subscribers.…”

“…There are 3 types of settings: independent clinics with small inpatient wards, small hospitals with inpatient and outpatient departments, and larger public and private hospitals with outpatient and inpatient departments and salaried physician staff similar to in Japan. 5 There is a phenomenon unique to Korea such as the concentration of the patients in large hospitals in Seoul and reputed doctors because patients are free to choose hospitals.…”

Health system reform in former socialist countries of europe

“…The final feature can be regarded as the distinguishing feature of a system of social insurance in contrast to funding from an earmarked payroll tax with universal entitlement. In reality, a continuum exists whereby a system becomes less tax-like and more insurance-like (Bodenheimer and Grumbach, 1992).…”

Relationship between Having a Home Doctor and Outpatient Utilization.

“…To achieve better equity in access to medical care is an important issue for the health care systems in many countries [1][2][3] While many factors affect access, the extent and characteristics of health insurance coverage is one of the most important dimensions relevant to patterns of utilization [4][5][6][7][8][9][10][11][12].…”