Differences Between Universal Coverage and Single-Payer

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When deciding upon health care coverage, it is important to understand the difference between universal health care coverage, and a single-payer system. 

Question: What is the difference between "universal coverage" and a "single-payer system"?

This is a very common question. You may hear the terms "universal coverage" and "single-payer system" mentioned in discussions pertaining to health care reform.

What do these terms mean? What is the difference between these two terms? As you'll see below, "universal coverage" and "single-payer system" are two separate yet closely related concepts.

Answer: "Universal coverage" refers to a health care system where every individual has health coverage. According to the U.S. Census Bureau, there were 46.6 million Americans without health insurance coverage in 2005. In contrast, there are no uninsured Canadian citizens - their government-run system provides universal coverage. Thus, Canada has universal health care coverage, while the United States does not. 

On the other hand, a "single-payer system" is one in which there is one party - usually the government - responsible for paying health care claims. This contrasts with the current health care system in place in the United States, where thousands of separate, private insurance companies are responsible for paying some citizens' claims, while federal and state governments are responsible for paying some others.

In most cases, "universal coverage" and a "single-payer system" go hand-in-hand, because a country's federal government is the most likely candidate to administer and pay for a health care system covering millions of people. It is very difficult to imagine a private entity like an insurance company having the resources, or even the overall inclination, to establish a nationwide health care coverage system.

However, it is technically possible to have universal coverage without having a single-payer system. For example, some experts have suggested that the United States incrementally reform the current health care system in the country to provide a government-funded safety net for the sick and the poor, while requiring those who are more fortunate health-wise and financially to purchase their own policies. Various political interests will likely prevent such a situation from ever happening, but it is technically possible to construct such a system, which would provide universal coverage while also having multiple payers.

While it is theoretically possible to have a single-payer system without also having universal health coverage, it is extremely unlikely to ever occur because the single-payer in such a system would undoubtedly be the federal government. If the federal government were to adopt such a system, it would not be politically viable for them to exclude any individual citizen from health coverage.

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