Health for All – The Moral and Social Case for Universal Health Coverage

In this chapter we’ll be dealing with universal health coverage as one of the key requirements of providing health for all citizens across the world.

Quite often we have looked at health as a very important investment for accelerated economic development. And indeed, the need to protect and promote productivity among individuals who contribute to economic growth in a society has been emphasized often enough to make sure that governments continue to provide increasing investments to health year round. However, while increased productivity is an important ingredient for making the argument for improved investments in health and for universal health coverage, we must recognize that merely a utilitarian argument of improved economic growth would not be appropriate because we need to bring in the equity argument as well and position health as a right. Otherwise a large number of people who are not contributing to increased economic growth, either because of age or because of illness and disability may be left out of that whole equation.

The reason why universal health coverage has become a major global priority in the last 15 years is because of the huge amount of impoverishment that healthcare expenditure is causing across the world. The World Health report of 2010, published by the World Health Organization estimated that every year about 150 million people face severe financial hardship and a 100 million are pushed below the poverty line because they fall ill, use health services and pay out-of-pocket. Many have to sell assets or go into debt to meet the payments.

And it is because of this healthcare related impoverishment, especially exacerbated by catastrophic health expenditure, but also because of a continued chronic drain on personal finances that ill health imposes, that we have to look at a more caring healthcare system in which we provide financial protection along with quality health services. And that adds up to universal health coverage. In terms of private, out-of-pocket expenditure, many countries, especially in the low and middle income countries, impose a huge burden on their citizens in terms of personal, private, out-of-pocket expenditure on health. Which means that beyond what the government provides, they’re spending quite often upwards of 50% from their own personal finances.

This is not acceptable because it is indeed a huge burden which results in healthcare related impoverishment. And we see this happening in different countries of Asia. If we look at 11 countries of Asia and look at what the out-of-pocket payment is and the proportion of people who are being pushed in to poverty each year, then we recognize that those countries which have low levels of out-of-pocket expenditure have low levels of impoverishment, especially due to healthcare expenditure. On the other hand, countries like India which have had high levels of out-of-pocket expenditure, have much higher levels of impoverishment annually, of people being pushed below the poverty line.

So we do really need to move towards a system which is much better and that is universal health coverage. Universal health coverage offers a way of sustaining gains

from and protecting investments in the countries that have already invested a fair amount on attaining the millennium development goals, which are related principally to maternal mortality, child mortality, poverty reduction, relief for under-nutrition and so on. Now clearly some of these goals have been attained partially and we need accelerated progress on attaining those goals. But a health system which is relatively inefficient or inequitable cannot bring about the required momentum. Universal health coverage on the other hand can galvanize the health system to perform better and achieve the goals which are only partially met. It also accommodates the changing agenda of global health which as we know, because of health transition is bringing a host of non-communicable diseases to the fore.

So universal health coverage by definition is the practical expression of the concern for health equity and the right to health. Moreover, access to services when needed also provide financial protection and also provide the comfort and assurance that people will get the services they need.

The Rio+20 United Nations Conference on Sustainable Development recognized the importance of universal health coverage for enhancing health, social cohesion and sustainable human and economic development. The U.N. in that meeting pledged to strengthen health systems towards the provision of equitable universal coverage. The countries participating in that meeting called for the involvement of all relevant actors for coordinated, multi-sectoral action to address urgently the health needs of the world’s population.

So universal health coverage as a goal, a strong health system as the vehicle, but also supported externally by concerted multi-sectoral action which will align actions in other sectors to the health needs and to the objectives of universal health coverage. And universal health coverage does provide financial protection which is the critical aim of universal health coverage. But beyond that, it insures greater health equity within countries and across countries. It also provides the population with improved health outcomes. Longer life, better quality of life, greater healthy life expectancy, far less disability. It also enables the creation of efficient, accountable and transparent health systems.

At the same time, it reduces poverty It leads to greater productivity, a healthy population is definitely going to be better for the economy through greater productivity. Most importantly, by creating a strong health system it can actually increase employment opportunities for a large number of young people and women because if universal health coverage is going to be focusing strongly on primary health services, in a world where there are the health workforce crisis, a great shortage of doctors, nurses, allied health professionals, you need to create more jobs on the front line. Many of them won’t be doctors, but a number of technology enabled front line health workers will have to be pressed into service for energizing primary health services. So in an era where the economic situation is not promising a lot of employment for young people seeking to enter the labor market, the health sector by embracing universal health coverage can actually provide a much larger pool of employment for a lot of young people who are aspiring for gainful livelihoods.

When we come to the implementation of UHC, there are two very important interconnected components. Firstly, coverage with the needed health services, prevention, promotion, and treatment and rehabilitation as well as coverage with financial risk protection for everyone. Since we said we will not be able to do everything overnight when we are introducing UHC, unless the country is very rich, many countries the low and middle income grouping will have to prioritize primary healthcare. Many countries look at primary healthcare, most of secondary healthcare, especially comprehensive maternal and child health services, essential surgical services and the emergency services as the initial package which they must introduce for universal health coverage and then expand by addition of other elements.

But again, primary healthcare becomes the absolute mandatory, initial component of any universal health coverage initiative. But at the same time, when we come to financial risk protection, we have to look at multiple sources. Virtually no country has achieved universal health coverage without a substantial infusion of tax revenues. That means a good part of universal health coverage has to be tax funded. Depending purely on health insurance, particularly employer provided or personally purchased health insurance doesn’t usually help because we need a large risk pool for insuring that there is sufficient sustainability for the program.

When we talk about a risk pool, we are talking about a number of people contributing to an insurance program where the sick minority is being subsidized by the healthy majority at any given point in time. Of course those who are sick can be healthy tomorrow. Those who are healthy today can become sick tomorrow. But it assumes that at any given time, the majority are healthy, they continue to pay insurance, but they’re subsidizing the sick. What we recognize is that in many of the countries, people are not always in the majority in the organized employed sector. Like for example in India, 93% of the workforce is in the unorganized sector. So you can’t have payroll deductions which automatically go into an insurance program. Many of the people are poor, they can’t afford to purchase private insurance. Even if the government provides substantially subsidized social insurance, many of the poor may not be able to get enrolled.

So as the risk pool shrinks, then the principle of that kind of an insurance where the healthy subsidize the sick or the rich subsidize the poor does not operate. On the other hand, in a tax funded health insurance system for universal health coverage you have the largest risk pool possible. And there the rich do subsidize the poor by paying higher taxes as a part of their social obligation. And the healthy majority does subsidize the sick. Therefore tax funding becomes an inescapable component of any financing for universal health coverage virtually in most parts of the world. And even in those countries, which have been really talking about insurance based systems, there is a substantial amount of government funding, even in the United States. So we need to look at a mixture of different funding sources with tax funding as the base and possibly other forms of insurance like employer provided insurance or government subsidized social insurance as additional components. One of the best known health economists, Bill Hsiao, or William Hsiao from Harvard writes that empirical evidence indicates that a free market for insurance cannot achieve social equity and that serious market failures allow insurers to practice risk selection.

That means they leave out the most vulnerable and make them uninsured. So if you are cherry picking and taking only relatively healthy people, for whom you do not have to pay much in terms of healthcare reimbursements, the people who really need healthcare are left uninsured. Dr. Hsiao also says that adverse selection among insurance buyers impairs the functions of the insurance market and deters pooling of health risks widely. Moreover the insurance markets high transaction costs yield highly inefficient results. However, there are some advantages. Dr. Hsiao indicates that evidence suggests that reliance on market competition for the provision of healthcare may hold potential for more efficient and higher quality care. What we are really looking at is the weaknesses of multiple competing insurance systems which adopt an adverse selection process. On the other hand, we still would like to bring in quality and efficiency into the healthcare system and even if we are going for a tax funded system, that is a requirement, to look for efficiency and higher quality of care.

Many countries have grappled with this problem and have adopted different models of universal health coverage, basically looking at their own country context and resource scenario. Indonesia has a social security providers law which replaced the previous community health insurance. And under this, 95% is paid by the government with the holder contributing 2% and the employer paying the remaining 3%. This has been particularly effective in Jakarta and is likely to be expanded across the country later.

Now in Canada, Medicare includes coverage based on health on need rather than the ability to pay. Provincial and territorial governments are responsible for the management, organization and delivery of health services for their residents. In Mexico, there have been a combination of different health insurance programs, substantially tax funded or government subsidized. Even though they are called insurance in the broad sense, they’re bringing a lot of government funded and government provided health services. And here particularly the introduction of Seguro Popular in 2003 brought financial risk protection to a further 50 million persons in the population. So that was a huge leap in terms of the number of people provided some assurance of healthcare with financial protection.

In Thailand, the universal health coverage scheme started off with what was called the 30 Bhat Scheme where people paid less than one dollar and that plan added about 14 million previously uninsured people to the Thai system. And this scheme has now been transformed with even greater coverage and a greater degree of financial protection at even lesser contribution at the personal level. In China, where there was previously an urban employer provided insurance scheme and the rural and migrant populations were left uncovered, since 2003, two more schemes have been introduced. One for the rural population and one for the migrant population. And between these three schemes now the coverage by some form of health insurance for provision of healthcare with some financial protection has extended to 96%. That means 96% of the Chinese people have some form of coverage.

But since the depth of services is still a bit limited, they’re still seeing the effects of out-of-pocket expenditure and catastrophic expenditure. As public financing increases, this is likely to decrease, even in China. In Brazil, the unified health system which is the nationalized program, provides primary healthcare while a network of public and contracted hospitals deliver specialist care. Primary care provision has substantially increased since its inception. And this also includes a national immunization program. And Brazil has adopted universal health coverage as an objective because the constitution has a right to health incorporated and therefore UHC is an important value.

In the United Kingdom, where the National Health Service started off as a model for many other countries which are now aspiring for universal health coverage, the government is responsible for funding access to healthcare and for supplying health services. And this is now a very important area where we find tax funded services reaching all sections of the people with assurance.

The whole world is now moving towards universal health coverage it appears, because in 2005, the World Health Assembly adopted a resolution asking all countries to adopt universal health coverage as a goal. In 2010, the World Health report focused on health financing for universal health coverage and then introduced the concept of the cube and how the cube can be progressively filled. We recognize that in most countries you can’t fill cube all at once. But you have to start visualizing the cube, recognizing that universal health coverage will be incomplete unless we try and fill most of the cube, but start moving progressively by prioritizing on each dimension as to where you begin and how you move forward, moving from the essential to the optimal.

In 2012 the U.N. had the Rio+20 conference, which again adopted this as an important goal. And then surprise, in 2012, the United Nations had a session on health and foreign policy in which they brought universal health coverage as an important component, recognizing that universal health coverage is important for global development and therefore for global stability and therefore for global security and therefore must form an important component of foreign policy initiatives as well. So whether it is the World Bank or the WHO or the United Nations or even diplomats or public health experts or economists, now universal health coverage has become the common currency of development discourse.

One of the important things that we must remember is that as we move towards universal health coverage, we are also moving towards a higher civilizational state because universal health coverage cannot exist without social solidarity. Unless society feels that they’re responsible for each other’s health, that they’re willing to support healthcare for another citizen who is in need, by contributing to the risk pool of ensuring that the health of every individual in that society is adequately cared for, you will not have universal health coverage as a successful model. Therefore the moment we adopt universal health coverage, not merely as a political slogan, not merely as a public health system goal, but as a societal commitment, then we are moving towards social solidarity. Without that we will not have UHC. But we have to make it effective through a functioning health system and through adequate financial investments to provide financial protection.

So in the context of the sustainable development goals, we now are likely to see universal health coverage positioned as a part of the health goal in the post-2015 agenda. but it is important that all countries start understanding first what universal health coverage entails and then start preparing not only their health systems, but their financing mechanisms as well as multisectoral coordination processes in order to pave the way for successful introduction and implementation of universal health coverage to promote health equity within countries and across countries.

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