Socialized

Medicine
By Yasmin Schulberg & Naomi Eugenio
 What is socialized medicine?
● Definition: the provision of medical and hospital care for all by
means of public funds. In America this includes:
○ Medicaid
○ Medicare
○ Veterans Health Administration
○ Affordable Care Act
● Purpose: to have lower medical payments under government
control and not in private control
Examples of socialized medicine in the U.S.
Medicare - a federal health insurance program that is available to;
● seniors of 65 years or older
● people with disabilities or those who receive social security
disability insurance
● people with end-stage renal disease (permanent kidney failure
that requires dialysis treatment or a transplant).
Medicaid - a jointly funded, federal state health insurance that is
available for anyone who is;
● pregnant women including the newborns
● elderly (65+)
● disabled
● terminally ill needing hospice
● up to 21 and living independently
● families of low income who do not receive
welfare checks (ex: $33,984 or less for family of 4 in Oregon)
Affordable Care Act(ACA)/Obamacare - landmark health reform
legislation passed by the 111th Congress and signed into law by
President Barack Obama in 2010. The three primary goals of
Obamacare are:

● Make affordable health insurance for Americans

● Expand the medicaid program to cover more people
● Support innovative healthcare at lower costs
● Eligibility for Obamacare is offered to those who are under 65
years old and with income up to 133% of the federal poverty
level
● Federal poverty level: A measure of income issued annually by
the Department of Health and Human Services (HHS) used to
determine eligibility for savings on Marketplace health
insurance, Medicaid and Children’s Health Insurance Program
coverage.

Ex: $12,060 for individuals or $24,600 for a family of 4

Socialized Medicine vs. Universal
Healthcare
Universal healthcare - system that provides financial protection for
healthcare to all citizens of a particular country

"Universal health care," such as has long existed in almost the

entire civilized world (except the United States), is not necessarily
socialized medicine. Instead, each of the various developed
countries has its own way to provide basic care to all of its people,
control cost escalation, ensure quality and safety, and appropriately
compensate the workers. And they do all of that more effectively
and more efficiently than the United States, with proven better
outcomes at much lower costs.” - Dr. George Lundberg
May 2017
Study of 2013 - Total health expenditure per
capita

“The Organisation for Economic Co-operation and Development (OECD) is a group of 34 member
countries that discuss and develop economic and social policy. OECD members are democratic countries
that support free market economies”
Study of 2016
 Universal Healthcare History
● Universal health care began in 1883 in Germany when the
Sickness Insurance Law was launched to provide injury/illness
insurance for the low-wage workers
● Post World War II healthcare systems launched worldwide
beginning with UK introducing its National Health Service,
healthcare systems traveled to regions in the Asia-Pacific,
North America, Australia, Africa, and more
● As of 2009 almost 70 countries across the globe offer universal
healthcare
History of Socialized Medicine in U.S.
● 1854: Activist Dorothea Dix proposed for “Bill for the Benefit of
the Indigent Insane” to establish asylums for the deaf, blind,
and insane
● 1933: During the Great Depression medical expenses were
unaffordable, President Franklin D. Roosevelt drafted from
social security pends (U.S. federal government insurance for
retired and disabled) to publicly fund healthcare programs
○ Attacked by American Medical Association
○ Roosevelt removed the healthcare bill in 1935
○ Fear of socialized medicine became standard in US
History continued
● 1965: Civil Rights public opinion shifted towards problem of
uninsured, especially the elderly. President Lyndon B. Johnson
took matters into his hands and signed Medicare into law
How socialized medicine is put into act:
Obamacare
● July 2009: the House of Representatives reveals democratic
plan for Affordable Care Act
● November 2009: in the House of Representatives,
supermajority votes for ACA
● March 11, 2010: Senate Democrats use budget reconciliation
to get bill approved by the House and the Senate.
● March 21, 2010: Senate’s version of ACA is approved by the
house
● March 23, 2010: President Obama signs the Affordable Care
Act into law.
Changes to ACA over time
● July 1, 2010: Pre-Existing Condition Insurance Plan was
designed to not let insurance companies deny an insurer
because of pre-existing conditions (ex: AIDS)
● September 23, 2010:
○ Patients are allowed to pick any primary care provider
without prior authorization, and ensures access to
emergency care
○ Adults can stay on their parents’ insurance until 26,
applying to all plans
● November 6, 2012: President Obama is re-elected ensuring
the ACA will continue
Changes to ACA continued
● November 8 2016: Donald Trump is elected as next US
President - Vice President Mike Pence claims “Donald Trump
will prioritize repealing President Barack Obama’s landmark
health care law right ‘out of the gate’ once he takes office”
● Trump’s opinion on Obamacare 2017
○ Block grants: federal funds that the government uses -
typically towards education or urban development systems
○ Premiums: periodic payments to insurance policyholder -
usually monthly
○ https://www.youtube.com/watch?v=Ca81GAQ4Rvc
Trump’s changes to Obamacare
"I am also calling on this Congress to repeal and replace
Obamacare with reforms that expand choice, increase access,
lower costs, and at the same time, provide better health care," -
Trump 2017. His goals include:

● Cut tax rates by 14% & top tax rate by 2.6%

● Increase competition between insurance provider companies
● Decrease premium prices by 20%
● Increase access to medical services (ex: small employers have
same access as large employers)
● Give tax credits to those who buy health coverage
independently
○ Tax credit: money to offset tax liabilities
The House Republican bill to repeal Obamacare passed in 2017,
with the assessment from the Congressional Budget Office
estimating 24 million more uninsured Americans by 2026.
If you’re covered by Obamacare:
● Insurance companies cannot cancel your plan due to an illness
● Certain preventive care services must be covered with no
additional cost
● Patients can choose any any in-network physician and
out-of-network emergency room without penalty
● Patients can appeal when insurer denies payment for services
● Insurance needs to provide insurers with summary of benefits
● Increase in rates of 10%+ must be publicly justified
Short term outcomes of Obamacare
● Provided millions preventative care for free
● Allowed employees with ‘pre-existing conditions’ to have health
insurance
● Gave tax credits to the middle class (incomes up to 400% of
federal poverty level)
● About 4 million lost their employer based health insurance
because the companies found it more affordable to pay the
individual mandate
● Raised income tax for millions
● Many insurance companies cancelled plans because they
didn’t cover preventative benefits
Long-term outcomes of Obamacare
● There will be no long term effects because the lifespan of
the Affordable Care Act was about 6 years

● Prognosis from 2012 of effects to 2020 (pros and cons):

○ Half of seniors would lose their Medicare advantage for
ACA funds
○ Add millions for eligibility for Medicaid (added 18 million)
○ Burdens businesses with $50 billion + taxes for mandating
health insurance for employees
○ In 10 years - imposes half a trillion dollars in taxes, which
is a burden targeting middle class and future taxpayers
Study from 2013
Benefits to Socialized Medicine:
● Promotes more job opportunities and encourages pursuing
healthcare education
● Basic healthcare needs met for everyone
● Helps aid preventative illnesses
● Reduces medical bankruptcies for citizens
● Boosts economy
● Everyone is one the same system - less paperwork for
patients, for visiting time with doctors
● Improves public health
Cons/Risks to Socialized Medicine:
● Quality healthcare is not guaranteed
● Requires higher taxes for middle-high income earners
○ “Once a large number of citizens get their healthcare from the state, it dramatically
alters their attachment to government. Every time a tax cut is proposed, the guardians
of the new medical-welfare state will argue that tax cuts would come at the expense of
health care – an argument that would resonate with middle-class families entirely
dependent on the government for access to doctors and hospitals.” - Wall Street Journal
● There aren’t enough doctors/facilities/equipment to provide for
all Americans
● Specialized healthcare jobs and education will decrease
● Reduces insurance competition
● Gives subsidized healthcare to illegal immigrants (5-year
waiting period)
Financial Cost Benefits
● Insurance companies can no longer deny those with
pre-existing conditions
● Beneficiaries will not get penalised for getting sick
● As of 2012, 3 million young people were added to
their parents insurance until age 26
● Preventative care provided eliminates preventable
illness which makes up about 90% of healthcare costs
Financial Cost Benefits
● The ACA provides tax credits for insurance to the middle class
(below 400% of the poverty level) It limits an out of pocket cost
○ Individual - $7,150
○ Family plan - $14,300
● Medicaid expands to 138% of the federal poverty level
● Covers 10 essential health benefits:
○ Preventative wellness visits, maternity care, mental behavioral treatment,
disability services, lab tests, pediatric care, prescriptions, outpatient care,
E.R visits, and hospitalizations
 Financial Benefits

Deficits: money shortages

Financial Cost Cons
● The ACA has reduced insurance competition
● Business’ are forced to cut employee hours
● The individual mandate for being uncovered is $695 -or- 2.5%
of household income- whichever is higher
○ Individual Mandate - A requirement by law for certain
persons to purchase a good or service
● Smaller business’ found it easier to go through state run
exchanges
○ State Run Exchanges: In the United States, health insurance marketplaces,
also called health exchanges, are organizations in each state through
which people can purchase health insurance.
Financial Cost Cons
● 4 million people paid total of $54 billion to
taxes - rather than coverage
● In 2013 the ACA raised income tax for 1
million individuals- with income above
$200,000
● Raised taxes for 4 million couples filing joint
returns - exceeding $250 million
● The overall healthcare cost curve is bending
“upwards”
● Taxes are rising for medical devices and
pharmaceuticals
Financial Cost Cons
● In 2013 Medical manufacturers paid a 2.3% excise tax
increase
○ Excise Tax - taxes paid when purchases are made on a
specific good.
● Pharmaceutical companies pay an extra $84.8 billion in fees
between 2013-2023
● Many lost their employment-based health insurance- business’
believed it was “cost-effective” to pay the penalty
● Increasing rate of 1.45% to 2.35% on income above the
threshold
 Religious Beliefs Benefits
● If you work for a religious employer - Health plans sponsor
certain exempt religious employers
○ Such as churches and other houses of worship
● Employees of nonprofits are able to be exempt from coverage
of contraception - needs to have a certificate of religious
exemption
● Jan 11, 2012: Supreme Court ruled in favor to constitutionally
fund:
○ Religious freedoms
○ Church operated schools
 Religious Beliefs Benefits
● Multiple religions are claiming protection from the Obamacare
anti-conscious mandate law
○ Religious Freedom Restoration Act - federal law that ensures
protection of religious freedom.
● Some Muslims accept Social Security for elders
● Section 1501 exempts Amish
● To qualify to be exempt, you need:
○ It must be a qualifying 501(c)(3) organization exempt from taxation under
section 501(a)
○ For example Christian Healthcare Ministries
 Religious Beliefs Benefits
● To qualify to be exempt, you need:
○ It must be a qualifying 501(c)(3) organization exempt from
taxation under section 501(a)
○ For example Christian Healthcare Ministries
○ Members must maintain membership- even after medical
conditions develop
○ The sharing ministry or leader had to be in effect since
December 31st,1991
○ Mandatory annual audits made on the public request -
done by certified
 Religious Beliefs Cons
● Employers of 50+ employees are to obtain health insurance for
ALL employees (regarding the company)
● Devout Muslims will not purchase insurance, or accept
conventional insurance - goes against the morality of the
religion
● Personal religious beliefs are not exempt
● Many don’t believe in social security tax as well
● Amish are exempt - a separate individual would have to waive
social security benefits, and workers compensation
 Moral Code Benefits
Moral code definition: A written, formal, and consistent set of rules
prescribing righteous behavior, accepted by a person or by a group
of people. (vs.) Ethics: moral principles that govern a person's
behavior or the conducting of an activity.
● Creates affordable options
● Passed HIPAA laws
● Unity
● Healthier country
● Stability/reliable
● Covering millions/saves lives
Moral Code Cons
● The Individual Mandate that’s given to employers goes against
certain morals, or religious beliefs of the employees
● Freedom of choice is taken away
● Basic civil rights are violated
● Increasing national debt (ex: insurance plans)
 Societal Impact Benefits

Reducing “job lock” and encouraging job

mobility and entrepreneurship.
 Societal Impact Benefits

● Improving financial security in the face of illness.

Societal Impact Cons
● Effects to the middle class- Insurance premiums went up even
if people are already covered
● Millenials have a staggering increase in taxes and insurance
○ “These increases reflect one big ACA truth – younger, healthier
Americans are required under Obamacare to overpay for their
insurance so that older, sicker, and (by and large) wealthier
Americans can underpay for their insurance.” -U.S News
● "The natural variation by age in medical costs is about 5 to 1 –
meaning that the oldest group of (non-Medicare) adults
normally consumes about five times as much medical care as
the youngest group." -The Heritage Foundation
● Enrollment into schools will be more difficult
Future Implications With the Repeal
Pros:

● Medicaid will expand- People will be going back into medicaid.

● Americans would be able to have the freedom of choice
● The individual mandate would be gone

Cons:

● 32 million people would lose insurance coverage after a

decade, and insurance premiums would double.
● The federal deficit would be cut by $473 billion
Future Implications With Socialized
Medicine (Obamacare)
Pros:

● The individual mandate would help offset the costs of providing

care for the sick
● Insurers would be able to bring in clientele

Cons:

● People have to pay higher premiums

● You have to pay a fine if you don’t have insurance
● Taxes rise
Questions for the class
● How could we be a healthier country with or without socialized
medicine that applies to all?
● How do you think removing the Affordable Care Act would
affect jobs in the country?
● How will repealing the ACA specifically affect those with
pre-existing conditions?
● How is it affecting households above the
poverty line?
● What is a way we could have socialized medicine
benefit everyone?
● Where do you as a student, see the issues with
socialized medicine?
References
https://qz.com/1022831/why-doesnt-the-united-states-have-universal-health-care/

https://www.medicaid.gov/affordable-care-act/eligibility/index.html

https://resources.ehealthinsurance.com/affordable-care-act/history-timeline-affordable-care-act-aca

https://www.hhs.gov/answers/medicare-and-medicaid/...eligible-for-medicaid/index.html

https://www.medicareinteractive.org/get-answers/introduction-to-medicare/medicare-eligibility/am-i-eligible-for-medicare-if-i-am-under-65

https://www.washingtonpost.com/news/fact-checker/wp/2017/06/22/history-lesson-how-the-democrats-pushed-obamacare-through-the-senate/?utm_term=.a23cbf862097

http://healthcare.findlaw.com/patient-rights/obamacare-basics-understanding-the-affordable-care-act.html

http://fortune.com/2017/12/20/tax-bill-individual-mandate-obamacare/

https://www.ache.org/pubs/Morrisey2253_Chapter_1.pdf

https://connectusfund.org/6-principal-pros-and-cons-of-socialized-medicine

https://vgavirginia.org/10-socialized-medicine-pros-and-cons

https://www.formosapost.com/pros-and-cons-of-universal-health-care/

https://www.webmd.com/health-insurance/news/20170220/the-short--and-long-term-prognosis-for-obamacare#2

https://www.heritage.org/health-care-reform/report/year-six-the-affordable-care-act-obamacares-mounting-problems

https://www.thebalance.com/obamacare-pros-and-cons-3306059

http://www.bbc.com/news/world-us-canada-38663043

http://www.brownpoliticalreview.org/2013/10/obamacare-and-the-long-lasting-effects-of-short-term-politics/

https://www.washingtonpost.com/blogs/fact-checker/post/how-many-pages-of-regulations-for-obamacare/2013/05/14/61eec914-bcf9-11e2-9b09-1638acc3942e_blog.html?utm_term=.b45e57d50945

https://www.upcounsel.com/obamacare-pros-and-cons