We need to institute ‘Medicare for all’
By Caroline Poplin, M.D., J.D.
MedPage Today, March 1, 2016
National health insurance has become a defining issue in the contest for the Democratic nomination. Bernie has put “Medicare for all” squarely back on the table. Hillary calls that pie-in-the-sky: instead, she would build on the Affordable Care Act (ACA). (As she says, market-based private insurance was originally her idea.)
We can all agree that the ACA has benefited many, particularly the poor and the sick.
But Medicare for all has picked up some interesting supporters: for example, Fareed Zakaria, a high-profile TV commentator whose beat is foreign affairs, and Donald Berwick, MD, who, as administrator of the Centers for Medicare and Medicaid Services, supervised the roll-out of the ACA.
Moreover, the Kaiser Family Foundation December 2015 Tracking Poll demonstrates majority support among ordinary Americans (58%); a 2014 survey of physicians and medical students in Maine showed that many doctors also (in Maine at least) would prefer single-payer, especially those practicing primary care.
So it is disappointing that liberal economists whom I respect, such as New York Times columnist and Nobel laureate Paul Krugman, conclude that single-payer would be too expensive and too disruptive — that we should improve the ACA instead.
Krugman, of course, is trained to crunch numbers — I can’t. But from the exam room where I sit, his conclusion doesn’t make sense. The principal advantage of single-payer, after all, is that it is less expensive than our market-based system.
That is not just idle speculation: every other developed nation has either some form of single-payer or highly regulated private insurance with price controls — and they all achieve better health outcomes, with genuinely universal coverage, for at least 30% less (as a fraction of the Gross Domestic Product) than we do, even though we still cover something less than the entire population.
Perhaps the economists simply substituted Treasury payments for employers’ contributions to their employees’ health insurance (something the ACA was specifically designed to preserve), and left everything else in place: that would indeed be a huge hit to the federal budget, particularly since employers, representing a large group of mostly healthy employee families, can negotiate better deals with insurers than individuals can.
But that is not how Medicare for all would work. Instead, it would be like Medicare today, improved to make it even less expensive for the Treasury and individual beneficiaries. Since everyone would receive the same, comprehensive benefits, administrative costs would be much lower. The huge transaction costs engendered by the ACA — hundreds of thousands of annual negotiations between insurers, doctors, hospitals, pharmaceutical benefit managers, and manufacturers — would decline significantly.
There would be no need for the development of hundreds of different plans at different prices, underwriting, or the careful regulation now required to be sure insurers comply with ACA requirements; there would be no need for exchanges.
And ordinary Americans would not need to spend hours each year figuring out which policy they can afford, or “need.” (In fact, most people estimate health risks poorly; women worry about breast cancer more than heart disease, although heart disease kills five times more women than breast cancer.)
There would be no need for poor people whose incomes vary day-to-day to deal with the incredibly complicated business of subsidies, where mistakes can trigger major tax penalties.
Finally — and most controversially — Medicare, which currently sets prices for doctors and hospitals, would extend price controls to other health services, such as prescription drugs and devices, through open procedures with due process and opportunity for comment as mandated by the Constitution. Or Medicare could negotiate prices, as the Department of Veterans Affairs currently does.
Private health service providers would remain private, although market competition simply hasn’t, doesn’t, and won’t, keep prices down in many healthcare markets in a way that benefits consumers. Every other developed nation has recognized this: they all control prices without compromising care.
For those who believe corporations can do no wrong, and government, nothing right, we can continue Medicare Advantage. Employers who wish could opt out, provided they show that their plans are equal to or better than Medicare. To prevent unnecessary disruption, Medicare for all could be phased in over time.
In fact, it may turn out that it is the ACA that is too expensive to be sustained. It is not just a matter of ineffective cost control, but of who pays. ACA supporters believe costs are high because Americans “demand” unnecessary medical services, because they are insured. Therefore, the ACA shifts significant expense to patients, to ensure enough “skin in the game”: the ACA’s so-called “silver plans,” favored by the law, require patients to pay 30% of their annual health care costs in addition to premiums. (Employer-sponsored insurance is moving the same way.)
This means someone who falls ill must pay thousands of dollars of deductible before his expensive insurance kicks in. Sick Americans can still face huge medical debts and bankruptcy, reduced only somewhat since passage of the ACA.
Yes, it is important to get things done in Washington, as long as they are the right things. There will be fierce opposition to Medicare for all, especially from for-profit insurers and providers; it is important to negotiate skillfully, to take a robust initial position, to withhold concessions until the bargaining starts, and to take the long view. The ultimate goal is not “coverage,” but universal, affordable healthcare.
Finally, remember: Medicare is not some exotic Scandinavian import. Medicare is as American as the flag, has served us well for 50 years, and is a solid foundation on which to build.
Caroline Poplin, M.D., J.D., is an attorney and internist in Bethesda, Md. She is a former staff internist for the National Naval Medical Center, and currently practices medicine part-time at the Arlington Free Clinic in Virginia. She also consults for law firms on Medicare and Medicaid fraud.
PNHP note: Physicians for a National Health Program (PNHP) is a nonpartisan educational organization. It neither supports nor opposes any candidate for public office.