By Katherine Baicker, Ph.D., and Amitabh Chandra, Ph.D.
The New England Journal of Medicine, September 16, 2020
Political slogans paint stark choices for health care reform: “Medicare for All” or “Free-Market Competition.” These slogans are designed to be simple and appealing — but vague enough to obscure the trade-offs involved, allowing listeners to fill in their own notions and masking varying beliefs. “Medicare for All” appeals to preferences for universal coverage, but sidesteps necessary trade-offs over which Americans may disagree. “Repeal and Replace” may appeal to skepticism about government’s role in health care, but leaves voters to imagine what the “replacement” might be.
The direction each of us would choose for our health care system depends on our answers to some fundamental questions: How much do we want to spend to expand coverage for low-income Americans? What health insurance features are most important to us? And what should the roles of government and the private sector be in making those decisions? Answering these questions involves wrestling with unavoidable trade-offs. Expanding insurance to cover more Americans will require deciding how generous that coverage should be, given competing priorities for public resources. Implementation of a single-payer plan as envisioned in some proposals would involve trade-offs between coverage features and costs. Similarly, free-market competition could drive down prices for some Americans, but leave care unaffordable for others. There is no single right answer to these questions, and slogans can’t tell us how to prioritize.
These slogans often paint a picture of a deeply divided America, while obscuring both shared priorities and disparate preferences. Enduring reform must be built on clear goals that guide the way we deploy inherently limited resources. Expanding public insurance means either spending less on other public programs or raising taxes. Having insurance with more generous coverage and lower copayments means paying higher premiums. Though there is ample room to compromise over policies that are designed to achieve shared goals, there is little prospect for consensus on reforms without agreement on what we want from our health system.
Several surveys track Americans’ views about the health care system, but they don’t generally capture the extent of agreement about these fundamental trade-offs. To help illuminate where Americans might agree or diverge on fundamental reform issues, in terms of both means and ends, we worked with the University of Chicago Harris School of Public Policy and the Associated Press–NORC Center for Public Affairs Research to assess these views (see the Supplementary Appendix for survey details). We fielded surveys of a nationally representative sample of more than 2000 Americans, with two waves in February 2020 and May 2020 spanning the explosion of the Covid pandemic, though there are of course limits to the generalizability of any two snapshots. To elucidate some central trade-offs involved in redistribution and plan design, we focused on three aspects of preferences and priorities: how altruistic Americans are, the importance they place on various features of insurance plans, and their beliefs about government’s effectiveness in improving the health care system.
Some observers argue that expanding insurance pays for itself, but there is little evidence to support this claim: expanding public insurance primarily benefits the people who gain coverage, and it requires additional spending. Support for expanding insurance must therefore be built on substantial altruistic concern about other people’s coverage. Perhaps surprisingly, our respondents were much more concerned about others’ access to affordable health care than about their own. Some 54% of participants who were asked how concerned they were about Americans without health insurance reported being very concerned, whereas only 24% of those asked how concerned they were about (potentially) being uninsured themselves reported being very concerned. Although participants who identified as Republicans were substantially less concerned overall about insurance coverage than those who identified as Democrats, both groups expressed greater concern for uninsured Americans broadly than for themselves.
But though there may be broad support for expanding coverage (albeit by varied mechanisms), the viability of a policy that would enroll the population in a single plan hinges on the alignment of people’s coverage preferences. As our results suggest, we all want different things from our health insurance plans — and our preferences vary in ways that don’t line up with our party affiliations. We asked participants which aspects of insurance plans were more important to them, focusing on the inherent trade-offs between costs and coverage (e.g., higher premiums for broader coverage versus lower premiums but restricted networks). There was no dominant view, with preferences almost evenly divided on multiple trade-offs (see table). For example, 47% of Democrats and 46% of Republicans said they would prefer to have an insurance plan with lower costs but more restrictions on covered care (vs. higher premiums but fewer restrictions).
Different reform proposals involve different mechanisms for making decisions about the trade-offs in resource use and plan features. The single-payer approach, for example, relies on government to have primacy in the health care system and to assume many of the functions of private insurers. When we asked participants whether they had greater faith in government or in the private sector to address health system problems, we found big differences in views about the government’s role in financing health care: 79% of Democrats thought the government was not spending enough on improving the nation’s health, while only 31% of Republicans concurred. Relatedly, 78% of Democrats thought that Americans should spend less on health care themselves but pay more in taxes, whereas only 37% of Republicans held this view.
We also saw a sharp partisan divide in faith in government as compared with the private sector to expand access, improve quality, and control spending: 72% of Democrats but only 33% of Republicans said they trusted the government more than the private sector to reduce costs. The pattern was similar for guaranteeing insurance coverage. But the majority of both Democrats and Republicans said they trusted the private sector more than the government to drive innovation, with only 35% of Democrats and 18% of Republicans saying the opposite.
If we want to improve our health care system, we must confront the difficult trade-offs inherent in the allocation of limited resources for potentially lifesaving care. If we want to expand coverage to people who can’t afford it, we have to prioritize making the resources available to do so. And if we want to have more expansive plan features and more generous coverage, we have to be willing to pay higher premiums.
Expanding insurance coverage is a priority that many of us share, but a one-size-fits-all single-payer plan is unlikely to meet everyone’s needs. Americans vary in their level of concern about coverage, cost, and quality, but most are more concerned about those features for others than for themselves. People’s divergent preferences regarding features of their own insurance highlight the value of having varied options to choose from — and the challenge of designing one insurance plan that would satisfy everyone.
Views regarding the government’s role in improving the system are sharply divided along partisan lines, in keeping with evidence from many polls about political divisions in support for particular health policy provisions. Such divisions suggest that the prospects for large-scale reforms remain limited by the political landscape. A successful approach might be to extend insurance coverage protections while maintaining a range of insurance plan designs and private-sector incentives to drive innovation. This approach differs from those taken by many other countries (and touted in many reform proposals), but is in fact the core approach in Medicare Advantage, Medicare Part D, and the Affordable Care Act — and it seems to match Americans’ priorities.
A natural question is whether these views have been substantially affected by Covid. In fact, our survey results from February and May were quite similar, which suggests that we may be capturing durable, fundamental preferences about health care and its delivery.
Political slogans simply don’t capture the types of reforms that are likely to achieve a nuanced set of objectives. Like the health care system itself, Americans’ priorities for it are complicated. Successful reforms must be informed by those priorities, but the trade-offs involved mean that they’re unlikely to take “simple,” polarized forms. The good news is that there are policy options available that preserve choice and promote innovation while honoring our shared commitment to making lifesaving care available to all.
Supplemental Appendix: Survey Instrument:
By Don McCanne, M.D.
What do the American people really want out of their health care system? The authors of this NEJM article suggest that the prevailing rhetoric – such as “Medicare for All” and “Repeal and Replace” – may be simple and appealing, but that it is vague enough that it obscures the various health policy trade-offs involved. Of course, since they are simply labels, they communicate very little, but that does not mean that people do not have general concepts in mind when they use these terms. One term refers to a government-run health insurance program in which everyone is included, and the other refers to a program relying primarily on the private market for the financing of health care in which coverage is not guaranteed but is based on the ability to pay. These two approaches are driven more by ideology rather than by the specifics of beneficial health policy.
Policy considerations are fairly obvious. Should a health care financing system be designed to include everyone? Make it affordable for each of us? Provide us with choices of our hospitals and health care professionals? And so forth. Most people would agree that we should have a better health care system that’s affordable for all of us. But some people are hung up on the ideology. Should the system be based on social solidarity or based on free market competition?
Using an AP/NORC survey, people were asked about concerns about their own insurance coverage and concerns about Americans who did not have insurance coverage. Both Democrats and Republicans showed some concern about both, but they were more concerned about others having coverage than having their own. On this policy issue, individuals from both major parties seemed to be altruistic, though the Democrats were more so. When asked about plan variation in costs and coverage, there was no dominant view and no partisan preference. Yet Democrats greatly preferred to have the government spend more on health care, paid through taxes, whereas only about one-third of Republicans agreed. Also, Democrats had more faith in the government to expand access, improve quality and reduce costs than did the Republicans. Obviously, ideology does influence policy.
Since the authors are noted, influential authorities in the policy community, it is helpful to try to extract from this article what their approach would be. Policies may be beneficial or detrimental, which explains why there is little agreement when individuals are required to choose from various trade-offs (e.g., exposed to financial hardship or being denied benefits). On the other hand, political ideology is more fixed and thus drives greater divides.
In this case, the authors reject one-size-fits-all single-payer, presumably because people should have choices between the policy trade-offs, so theoretically we can ignore the ideological preference for a program that is taxpayer financed and publicly administered. Then the authors mention private insurance programs that are at least partially publicly financed to demonstrate their preference: Medicare Advantage, Medicare Part D, and the private plans of the Affordable Care Act, claiming that these seem to match Americans’ priorities. Is introducing into a public program the use of private insurance a beneficial policy preference or an ideological preference? Beneficial for whom? Not the patients.
What they miss is that policy trade-offs do not necessarily require giving away beneficial features. As an example, you do not have to reduce benefits to eliminate excessive cost sharing. You can trade off the profound administrative waste created by our private insurance industry in order to have a full benefit package without the necessity of including the financial barriers of cost sharing. And ideology? Why would we want to screw up beneficial health care policies with nutty right-wing innovations?
Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.