Healthcare Coverage

• A healthcare system either supplies universal coverage, where by law all residents are provided with healthcare, or non-universal coverage, where this is not the case. The first role of government in healthcare policy is to decide whether to supply universal coverage to its population. Universal care is a popular choice for countries that can afford it; universal healthcare exists in every industrialized nation except the United States, as well as in many of the more prosperous developing countries.
  
  

Healthcare Financing

• There are four main ways to pay for healthcare costs: general taxation, insurance, self-payment and charity. Self-payment, where individuals pay for their own healthcare expenses out of their own pockets, is problematic because treating serious health problems can cost from tens of thousands of dollars up into the millions, which is likely to bankrupt a person who is paying out of pocket. No country relies on self-payment to finance its healthcare system. Charity can provide healthcare to those who are in a state of extreme need. There isn't enough charity to go around, however, and so it remains a niche solution. Overwhelmingly, taxation and insurance are the key financing instruments of a healthcare system. The second role of government in healthcare policy is to decide how healthcare costs can be paid.
  
  

Public versus Private Financing

• In a public healthcare system, doctors, nurses and pharmacists are reimbursed by the government. The government pays for this by collecting taxes, by selling public health insurance or by some combination of both. In a private healthcare system, healthcare providers are reimbursed by private insurers. They pay for this by charging premiums and other fees to their customers. It is the third role of government to decide whether the universal system will be funded publicly or privately. Often, a combination of both is used.
  
  

Second-Tier Healthcare

• Most industrialized nations with publicly funded universal healthcare have a supplementary private healthcare system on top for people who wish to pay more money for higher-quality service. It is the fourth role of government to decide how extensive this supplementary private system will be. The existence of a second-tier system draws dollars away from the main healthcare system by allowing the affluent to spend their money more directly on themselves, leaving disproportionately less money to go to the broader public. In the United States, there is no universal public system underneath the private one; a significant percentage of the population has little or no access to healthcare, while those who are able to afford it can buy into the second tier and receive high-quality care.
  
  

Healthcare Philosophy

• The fifth and most important role of government in healthcare policy is to decide what healthcare "is." The key point of contention is whether healthcare is a commodity or a human right. Those who see it as a commodity typically hold that government should generally defer to the private sector so that free enterprise might develop the most profitable healthcare system and individuals might purchase healthcare according to their ability to pay. Those who see healthcare as a human right typically hold that government should intervene to make healthcare available to everyone, regardless of the profit margins and regardless of individuals' ability to pay.