PNHP

The Single-Payer System In Taiwan

By Ida Hellander, M.D.
Health Affairs, Letters, June 2015

Evidence-based health policy could transform the US health system. The evidence for single-payer systems is well summarized by Tsung-Mei Cheng in her article (Mar 2015) on Taiwan’s single-payer National Health Insurance (NHI).

Taiwan’s NHI was approved in 1994 and was implemented in less than a year. About 41 percent of Taiwan’s population was uninsured before reform, compared with 16.3 percent of the US population before the passage of the Affordable Care Act.1 Today, 99.9 percent of Taiwanese are insured and enjoy free choice of physician. In contrast, twenty-seven million Americans will remain uninsured in 2025, tens of millions more are underinsured, and physician choice is restricted, except in traditional Medicare.2

Taiwan’s single-payer system is efficient, devoting only 1.07 percent of expenditures to overhead. In comparison, the largest private insurer in the United States, UnitedHealthcare, diverted 19.1 percent of premiums to administration, marketing, and profits last year.3 The United States could save $375 billion annually on administrative costs with a single-payer system, enough to cover all of the uninsured.4

After two decades, Taiwan’s NHI enjoys high public satisfaction and is evidence that affordable universal health care is possible, but only with a single-payer system.

Author affiliations: Physicians for a National Health Program, Chicago, Illinois

NOTES

  1. DeNavas-Walt C, Proctor BD, Smith JC. Income, poverty, and health insurance coverage in the United States: 2010 [Internet]. Washington (DC): Census Bureau; 2011 Sep [cited 2015 Apr 17]. Available from: https://www.census.gov/prod/2011pubs/p60-239.pdf
  2. Congressional Budget Office. Insurance coverage provisions of the Affordable Care Act—CBO’s March 2015 baseline [Internet]. Washington (DC): CBO; 2015 [cited 2015 Apr 16]. Available from: https://www.cbo.gov/sites/default/files/cbofiles/attachments/43900-2015-03-ACAtables.pdf
  3. Herman B. UnitedHealth ends 2014 with sizable profits. Modern Healthcare [serial on the Internet]. 2015 Jan 21 [cited 2015 Apr 16]. Available from: http://www.modernhealthcare.com/article/20150121/NEWS/150129988
  4. Jiwani A, Himmelstein D, Woolhandler S, Kahn JG. Billing and insurance-related administrative costs in United States’ health care: synthesis of micro-costing evidence. BMC Health Serv Res. 2014;14:556.

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