A battle is looming over universal health care. Politicians and voters will have to decide whether the trade-offs are worth it.
By The Editorial Board
The New York Times, February 16, 2019
It’s been nearly 10 years since the passage of the Affordable Care Act — one of the most sweeping health care overhauls in the nation’s history. The law has brought the number of uninsured people in America to an all-time low, secured protections for people with pre-existing conditions and advanced the notion that health care is a human right.
But the system was never perfect, and its fractures and stress points have become too great to ignore. The number of people who are uninsured or underinsured is rising again, after two years of sabotage to the current law by the Trump administration. A Republican-led lawsuit that once seemed like a lark is threatening Obamacare’s protections for pre-existing conditions. And high out-of-pocket costs, absurd hospital billing practices and ever-rising prescription drug prices have forced too many people to skip crucial treatments, avoid emergency rooms and ration life-sustaining medications.
America may be a country rich in medical innovation — a place where robots perform surgery — but it’s also one where tens of thousands of people die every year because they can’t afford basic care.
Both parties seem certain to make health care a significant election issue over the next two years. There are no fewer than six Democratic bills floating through Congress that would address these problems. And “Medicare for all” — a concept that describes only some of those proposals — has become both a rallying cry and a test of progressive credentials.
Voters, however, appear more ambivalent. Though health care has long topped the electorate’s list of concerns, including in the 2018 midterms, surveys suggest that most Democrats want their party to focus on fixing the Affordable Care Act rather than on starting a long-shot bid for a single-payer health care system. In a recent Kaiser Family Foundation poll, some 56 percent of Americans, including nearly a quarter of Republicans, supported the idea of a new federal program; but when trade-offs like higher taxes or the loss of private insurance options were factored in, that support evaporated.
As the 2020 race heats up, here’s a primer to help citizens sort out where they stand.
What are the options?
The plans currently in play differ in their particulars: Senator Bernie Sanders’s Medicare for All Act would scrap private insurance and create a new federal system to cover everyone; a plan from the Center for American Progress, a think tank, would create an optional public program that anyone could buy into; and a plan from Senator Debbie Stabenow would give all Americans the option to buy into Medicare when they turn 50. But these plans would extend coverage to more people and would increase the federal government’s role in providing and policing health insurance.
The proposals fall into two broad categories: universal and incremental. On the universal side, Medicare for all would largely eliminate the need for private insurance and for other public programs like Medicaid and the Children’s Health Insurance Program. Its coverage would also be more expansive than current Medicare: It would include eye and dental care as well as prescription drugs, and it would eliminate premiums, deductibles, copays and surprise medical bills.
A single federal payer — as such proposals envision — may well eliminate the waste, inefficiency and corruption that make the current system so expensive and inaccessible; the experience of countries like Canada and Britain that rely heavily on one government payer suggests as much. But such a system would require dramatic changes from the status quo and would be a tough political sell. What’s more, single-payer is not the only way to achieve universal coverage.
On the incremental side, several different proposals would allow certain people to buy into existing public plans. Some would enable older Americans who are not yet eligible for Medicare to buy into that program — at age 50 or 55 or 60. One would let people who don’t have other insurance coverage buy into Medicaid (as long as their state opted into the program).
Because these programs don’t rely on a single payer, they would not do as much to clean up the existing system. But they have a better chance of being adopted by Congress, and some could bring the country very close to achieving universal coverage.
What would happen to private insurance?
A recent Kaiser poll found that the potential loss of private insurance was what turned most people off the concept of Medicare for all. That’s not surprising. About half of all Americans — some 156 million people — get their health insurance through employer-based plans, and another 30 million rely on other forms of private coverage, including the A.C.A. marketplace and Medicare Advantage plans. The vast majority of those people say that they like their coverage. And so far, the majority of Americans seem loath to give up what they have, no matter how good the alternative is made to sound.
That’s too bad. The idea of forcing more than half the country off existing programs might sound scary, but the majority of those people are at constant risk of losing their health coverage — for instance, if they lose or leave their jobs, if their employers change plans or if their insurers change their terms in ways that increase out-of-pocket costs.
Still, the choice between universal health care and private insurance will very likely prove to be a false one. Most of the six plans leave ample room for private options to play a role, and the ones that don’t — the true Medicare for all proposals — will almost certainly change as they are negotiated. As Vox points out, no other country has managed to achieve universal health care without including some form of private insurance.
Proponents of Medicare for all say that total health care spending would remain roughly the same, but that more of that spending would be shouldered by the federal government and less of it would be wasted.
A single-payer system would mean fewer administrative costs. Eliminating other government programs would free up billions of dollars for the new plan. And eliminating private insurers would bring billions more dollars worth of profits and employer taxes back into the health care system. (Businesses currently enjoy a tax break on the money they spend covering their employees.)
But there would also be new taxes. Proponents say that, to the extent those taxes fell on consumers, they would be offset by the elimination of premiums, deductibles and copays. But that may not be enough to assuage voters. In Vermont and Colorado, legislators dropped bids for a state-run single-payer system when it became clear that people would not support the tax increases needed to sustain such a program.
Taxes are not the only trade-off. Increased efficiency and less profiteering should mean that more people would be covered and could afford the care they needed. But a single-payer system could also mean the elimination of many thousands of health care jobs and lower pay for providers, both of which could impede access to, and the quality of, care. Those impediments could be small — slightly longer wait times, for example. Or they could be substantial — much longer wait times and far fewer doctors.
What would be covered?
There are two basic ways for insurance programs to curb costs. One is to cover fewer things; the other is to negotiate on prices.
Medicare for all would forgo the first option, meaning that it would cover everything. But it would use the massive bargaining power of so many users — the entire United States population — to negotiate far better deals on prescription drugs, hospital stays and more. The different incremental programs would use both levers: Most would not cover vision or dental, for example. But all of them would also direct the secretary of health and human services to negotiate costs with providers.
Most other countries use negotiating power to control health care costs; that’s why prescription drugs cost so much less elsewhere than they do in the United States. But those countries accept a trade-off, inherent in this approach, that the United States has so far resisted: They forgo access to certain innovations, like pricey new drugs and medical devices whose benefits are found to be minimal.
A plan that results in higher taxes but skimps on cutting-edge medicine may seem unfair — and may well be unpopular. But many Americans are already being denied essential services every day. It may make sense to forgo innovations that a growing number of people can’t benefit from anyway in exchange for a program that sets fair prices at the outset and doesn’t leave people rationing low-tech essentials or begging for donations to cover basic costs.
The fight to once again remake American health care will almost certainly be brutal. Before voters can decide if they want to have that fight, candidates will need to clarify what they are selling. Only then can the nation have an honest dialogue about the risks, benefits and trade-offs ahead.
By Don McCanne, M.D.
If you read this New York Times editorial carefully and sort out the facts, the editors have made a very solid case for a single payer Medicare for all system of financing health care. Such a system would provide efficient, comprehensive health care for everyone, and it would be affordable for each of us. Yet they have woven into their narrative the suggestion that such a system would require trade-offs or sacrifices. Not a very bold approach. Besides, what sacrifices are they talking about?
They say that higher taxes would be a trade-off for enacting a single payer system. But those taxes displace our current inequitable, fragmented system of financing health care. How can you call this a sacrifice when single payer is financed through progressive taxes based on ability to pay – a highly equitable (i.e., fair) method of financing health care for all of us? Using the tax system is not a sacrifice, but rather it is a benefit of the single payer model.
Particularly hot right now is the meme that people would have to sacrifice by giving up their private insurance if we switched to single payer. But private insurers are intermediaries that use administrative mechanisms designed to reduce utilization of health care no matter how beneficial that care may be. High deductibles and other cost sharing create financial barriers to care. Narrow provider networks limit access to health care professionals and institutions. Administrative interventions such as prior authorization requirements create additional barriers to care. And for this we pay more because of these expensive administrative functions that provide no health benefit. Besides, how many people do you know who have been able to keep their same precious private insurance plan throughout their lives. Nobody. Private insurance is an unstable method of financing health care with constant changes in providers, benefits, and in the insurers themselves, especially with inevitable changes in employment. Switching from private insurers to stable, life-long coverage is not a sacrifice, but rather it is another benefit of a single payer system.
The editors point out that doing away with private insurance may be a false choice since other countries include some form of private insurance. But the benefits in a well designed single payer system should be comprehensive enough that additional insurance should not be necessary. If someone wants a penthouse hospital suite or vanity cosmetic surgery, they are likely wealthy enough to not need a supplementary plan anyway, plus who really wants to participate in funding that kind of a risk pool? Also it is important to prohibit private plans that duplicate the coverage of the public program since those plans are used to jump the queue. Instead of allowing wealthier individuals a ticket to the front of the line, we need to recruit wealthy individuals to advocate for appropriate capacity adjustments and queue management so that none of us has to face excessive queues.
Another trade-off they allude to is the elimination of hundreds of thousands of administrative jobs that would no longer be required in an efficient single payer system. Not only are the administrative services that are being sold to us by the insurance industry, plus the administrative service burden placed on the health care delivery system by the insurers, costing us enormous amounts of money, they are intrusive services that we do not even want. It would be far better to eliminate those positions and transfer those employees into jobs that improve productivity for our economy. That’s not a sacrifice. We would all benefit – employees and society alike.
They hint that government price negotiation might suppress innovation for new drugs and medical devices, but there is no way that the pharmaceutical, biotechnology, and medical device industries are going to walk away from trying to get a significant share of the multi-trillion dollar health care industry budget. They might have to price their products fairly, but that is hardly a sacrifice on our part.
The editors tell us that a single payer system “would require dramatic changes from the status quo and would be a tough political sell.” Dramatic changes? You mean, everybody in, nobody out? Isn’t that the kind of dramatic change we really want to see? And a tough political sell? Now there’s a trade-off for you – trade our current stuck-in-the-mud politicians for ones who really care about the people and our health. So that’s our sacrifice – losing a few politicians on the way, returning them to the economy where they can improve productivity instead.
Time for boldness.
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