By Howard Bauchner, M.D., Editor in Chief, JAMA
JAMA, Editorial, February 13, 2019

The modern era of medicine began in the 1960s. Health care coverage expanded with the passage of Medicare and Medicaid and the increasing availability of employee-based health insurance. Scientific and clinical advances began to occur at a far more rapid pace. Physicians became more specialized and began to focus on acute care dominated by cardiovascular disease, diabetes, and cancer rather than infectious diseases, and there was increasing recognition of the importance of chronic diseases. With more data available, it became possible to measure variation in the delivery and quality of care, along with disparities and rationing in the provision of care. Health care costs per person more than doubled between 1960 and 1970, beginning their 5-decade increase.

Rationing and cost of care are inextricably linked, although measuring the amount and extent of rationing and defining rationing is difficult. There are many types of rationing, including rationing by access (type of insurance), by cost (out-of-pocket expenses), by restriction (the service is not available or paid for by a third party), or by long waits (Canada and parts of the United States). Broadly, rationing refers to approaches that are used to allocate resources and potentially restrict access to effective therapies. Rationing is linked to poverty, race, and ethnicity, and it inevitably leads to differences in the care that certain groups of individuals receive.

Rationing of care often is part of the larger discussion of disparities in health care. Healthy People 2020 defines a health disparity as “a particular type of health difference that is closely linked with social, economic, and/or environmental disadvantage. Health disparities adversely affect groups of people who have systematically experienced greater obstacles to health based on their racial or ethnic group; religion; socioeconomic status; gender; age; mental health; cognitive, sensory, or physical disability; sexual orientation or gender identity; geographic location; or other characteristics historically linked to discrimination or exclusion.” Disparity in health care is often used as an inclusive term, including differences in health outcomes, which is not only a product of access to treatment but also social determinants of health. Social determinants of health, for example, the quality of education and housing, are largely outside of the general focus of the health care system, although that is changing with an increasing commitment to population health and renewed interest in the inextricable link between social determinants of health and health outcomes. Disentangling and differentiating among health disparities, health outcomes, rationing of care, health equity, population health, and social determinants of health represent important challenges.

This decade and the next likely represent the postmodern era of medicine. Big data, machine learning, precision medicine–based therapies, and the genetics revolution, including rapid sequencing of the genome and manipulation of both the germline and somatic cells, suggest that the scientific advances to emerge may be as significant as the expansion of health care coverage and other medical advances in the 1960s and 1970s. The expansion of health care coverage brought with it the recognition of health care disparities and the rationing of health care. An important question is whether these new scientific advances, with their attendant cost, will lead to further rationing of care.

Following the passage of the Affordable Care Act, much of the national discussion was focused on expansion of coverage and value in health care, but new concerns about rationing of care are emerging. For instance, more than 3 million individuals in the United States have hepatitis C infection. Who has been treated and who has not been treated? Will the remarkable discoveries such as CART-T cell technology or cancer immunotherapy be widely available, or rationed based on the ability to pay? Who has had access to transcatheter aortic valve replacement and who has not? With a cure for sickle cell disease in reach, will this treatment be developed and then become widely available, similar to new treatments for cystic fibrosis, or will inadequate research funding delay the development of a possible cure? How will decisions be made about the use of extremely expensive care during the last years of life? As more successful treatments become available for rare diseases, at very high cost, will all individuals benefit, or just a select few?

The cost of health care continues to increase, now approaching 18% of the US gross domestic product. Health care expenditures consume approximately 30% of many state budgets, and this does not include the cost of health care paid by states for their own employees and via pension benefits. Even at the estimated 4% to 5% yearly increase in health care costs for the next decade, this projected increase exceeds the rate of inflation. As the number of individuals working in health care increases, any reduction in the ongoing increase in cost will be nearly impossible. Moreover, some highly prevalent conditions will continue to drive increases in health care costs. For instance, the obesity epidemic will inevitably increase health care expenses, with its associated complications affecting the endocrine, cardiovascular, and musculoskeletal systems, including hip and knee replacement operations at younger ages, and often necessitating subsequent joint replacement procedures.

The United States is mired in a great philosophical debate. Is health care a right or a privilege? In part this debate is embedded in the historical, underlying sociopolitical discourse in the United States — is this a nation that champions individual rights and achievement at the expense of the common good? This philosophical debate plays out in health care. Rationing of health care is likely always going to occur, but for those who maintain that health care is a privilege, attention to rationing and attempts to ensure that rationing is minimized may not be a priority. Yet, even for those who assert that health care is a right and that health care coverage should be provided to all individuals in a more just and fair way, unless the relentless increase in the cost of health care is addressed, rationing of health care is likely to become more common.

Identifying approaches to mitigate the increase in health care costs has been elusive. Debates about waste in health care, prices of drugs and devices, volume, fraud, defensive medicine, inappropriate testing, and misaligned incentives have been ongoing for more than a decade. Each of these potential areas of cost containment provides income for specific groups, making change difficult. However, there is one area — administrative costs — about which there is broad agreement that it adds needlessly to the cost of health care, frustrates physicians and other clinicians, provides little benefit beyond employment, and clearly is one area in which the United States leads the world. These costs involve, but are not limited to, billing, excessive documentation, and the need to obtain prior approval for certain medications, radiological procedures, and specialty referrals. Although there is uncertainty about what percentage of the $3.5 trillion in annual health care spending is accounted for by administrative costs, if that amount is 10%, and could be reduced to 5%, an estimated $175 billion could be saved or redirected to provide care to patients and avoid rationing of some health care services. Reducing administrative costs should be the major focus of national efforts to reduce waste in health care and help control increases in health care spending.

For the United States to prosper in the 21st century, controlling health care costs is critical — indeed, it is the single most important challenge facing health care. Greater rationing of care is inevitable if health care costs continue to increase. Controlling health care costs is the only way to ensure appropriate investment in other areas, such as education, the environment, and infrastructure, and to provide a more equitable, just, and fair distribution of the remarkable health care advances that have been achieved with even more on the horizon. It has been said many times that in the richest country in the world, in which many of the greatest scientific and medical advances are developed, it is a blight on the US soul that each of its residents does not fully benefit from available health care.

https://jamanetwork.com…

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Comment:

By Don McCanne, M.D.

For those of you who skip the quoted text and go right to the comment (often a wise move as a time-saver), please pause here and read the last three paragraphs of Howard Bauchner’s editorial, and then return here.

How many times have you heard the opponents of single payer Medicare for All say that if we adopt such a system here then we’ll have rationing like the socialist health care systems of other nations? Yet the irony is that we already have a major problem with rationing, and it is perhaps the cruelest version of all since we ration by ability to pay in spite of spending far more on health care than any other nation.

So how did we end up with both high spending and rationing? Quite simply we have the most administratively complex health care financing system of all nations, which is very expensive to run, wasting funds that could be used on health care for those who are victims of rationing, not to mention that our financing system is profoundly inefficient. Remember that tens of millions of US residents remain uninsured, tens of millions more face excessive financial barriers to care due to excessive out-of-pocket spending, and personal bankruptcy due to medical debt has not declined with the implementation of the Affordable Care Act.

Bauchner has defined the problem: profound administrative excesses. We know the solution: administrative efficiency through a publicly-administered, equitably funded Single Payer Medicare for All program.

There has been a surge in support for a public option such as a Medicare buy-in, but that only adds one more player to our administratively complex, wasteful system. There is also support being expressed for our employer-sponsored plans and for other private approaches such as the Medicare Advantage plans, but these perpetuate our costly, dysfunctional, multi-payer approach to health care financing.

So what about rationing? With Single Payer Medicare for All we would essentially eliminate rationing by insurance design, rationing by restriction of benefits covered, rationing by prohibition of obtaining care outside of narrow provider lists, rationing by unaffordable out-of-pocket cost sharing, or rationing by administrative barriers such as prior authorization requirements. These forms of administered rationing are harmful and should be done away with. Inability to pay for care would no longer be a barrier since a Single Payer Medicare for All program finances care equitably such that it is affordable for everyone. Maldistribution of health care professionals and institutions would be corrected through central planning and equitable distribution of our health care resources. Although all nations, including ours, must deal with queues, other nations have shown that the delays can be minimized by improving distribution of health care resources and funds, and also by simply applying the science of queue management, though that requires that we select to run our government stewards who actually care.

Bauchner says, “it is a blight on the US soul that each of its residents does not fully benefit from available health care.” But we can fix this, and the sooner the better.

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By Yusra Murad
Morning Consult, February 13, 2019

While top Democrats prepare to release health reform bills offering different iterations of single-payer systems and public insurance options and as Democratic presidential hopefuls begin building their health care platforms, “Medicare for all,” a long-cherished dream of progressive lawmakers and advocates, has come under increased fire from opponents who warn voters that they are at risk of losing their private insurance.

The laser focus on expanding the government’s role in health care has coincided with a double-digit slide in net support for “Medicare for all” among voters from January to February, according to new data from a Morning Consult/Politico poll.

Although “Medicare for all” enjoyed net support of 27 percentage points (calculated by subtracting the share of opponents from the share of supporters) among registered voters at the onset of 2019, that share dropped 15 points in the Feb. 7-10 survey, to 12 points.

The possibility of losing private insurance cuts support for “Medicare for all” in half. In the latest survey, when “Medicare for all” supporters were subsequently asked whether they would still back a government health system that eliminated the private insurance market, about 1 in 2 respondents (49 percent) reaffirmed their position, but just over one-fifth — or 22 percent — withdrew their support outright. Another 29 percent said they no longer knew or had no opinion.

Unlike the “Medicare for all” system, the popularity of the public health insurance option transcends party lines. About three-fourths of all voters (76 percent) support a system offering them the choice to purchase coverage either from the government or the private market.

Sens. Cory Booker (D-N.J.) and Elizabeth Warren (D-Mass.), both supporters of Sanders’ “Medicare for all” bill, have stopped short of calling for the immediate elimination of private insurance. Sen. Michael Bennet (D-Colo.), who is weighing a bid for president, called pushing for a system that would pull the plug on employer-sponsored coverage “a bad opening offer.”

Instead, Bennet — alongside Sen. Tim Kaine (D-Va.) — is proposing a public health insurance option, in which a federally run health plan would compete with, rather than replace, private insurers. Their “Medicare X” plan does not require a tax increase nor guarantee coverage for all Americans, but public plan enrollees would continue paying premiums.

Sens. Debbie Stabenow (D-Mich.) and Tammy Baldwin (D-Wis.) and Reps. Brian Higgins (D-N.Y.) and Joe Courtney (D-Conn.) plan to announce a bill today giving adults between the ages of 50 and 64 the option to buy into Medicare.

https://morningconsult.com…

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Morning Consult/Politico Poll of registered voters, February 7-10, 2019

Do you support or oppose a Medicare for All health care system, where all Americans would get their health insurance from the government?

29% – Strongly support
21% – Somewhat support
15% – Somewhat oppose
23% – Strongly oppose
11% – Don’t know/No opinion

Among those who support a Medicare for All option: As you may know, some proponents of Medicare for All have called for the elimination of private health insurance. If a Medicare for All health system included eliminating the private health insurance market, would you still support this type of health care system?

49% – Yes
22% – No
29% – Don’t know/No opinion

Do you support or oppose a public health insurance option, where Americans can choose to get their health insurance either from the government or from the private insurance market?

40% – Strongly support
36% – Somewhat support
7% – Somewhat oppose
6% – Strongly oppose
11% – Don’t know/No opinion

Poll (pages 136-147):
https://morningconsult.com…

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Comment:

By Don McCanne, M.D.

Although this poll confirms that 50 percent of voters support a single payer Medicare for All program where all Americans would get their health insurance from the government, only one-fourth (49 percent of 50 percent) support it if it meant that the private insurance market were eliminated.

In contrast, three-fourths support a public option (a Medicare buy-in) where Americans can choose to get their health insurance either from the government or from the private insurance market.

Although some might interpret this to mean that single payer would not be popular, the experience with Medicare suggests that is probably not true, though the private Medicare Advantage plans are eroding support for the traditional Medicare program. It is more likely that the typical voter does not understand the policy implications of the Single Payer Medicare for All model. In order to obtain equity, efficiency, effectiveness and affordability of Medicare for All, the private plans must be eliminated. Yet you cannot explain that in an elevator speech; the policy science behind it is quite complex.

The politicians are now lining up in support of the fake Medicare for All proposals that do protect and preserve the private insurance industry. The steam roller is already on its way.

It been stated here frequently that we have a lot of work to do. This poll confirms that more than ever. It could be only weeks before the support for Single Payer Medicare for All crumbles. The media is becoming saturated with doomsday predictions for a government-run version of Medicare for All. We have to ask, can our slingshot take down their Goliath?

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By Governor Gavin Newsom
February 12, 2019

Next, if we’re serious about taming the cost crisis we need affordable healthcare for all Californians.

Our ability to invest in everything we care about is constrained by the pressure of rising health care costs. It impacts everything else we want to do.

The White House is laser-focused on destroying the Affordable Care Act. The vandalism they’ve already done to the individual mandate has had consequences. This year’s Covered California premiums increased almost twice as much as we expected. This is just what we feared, and it’s just what they wanted.

That’s why, when it comes to the individual mandate, California must act where Washington failed.

If we do, we will be able to deepen subsidies for those earning up to $48,000 and extend subsidies to families earning up to $150,000, something no other state in America has done. We all know California has among the lowest Medicaid reimbursement rates in America.

That’s why our budget devotes more than $1 billion to increase rates and address the provider shortage.

This investment will also allow us to increase access to preventative health measures like -immunizations, trauma screenings, and mental health services. And it provides $100 million for reproductive health and family planning.

As we pursue the long-term goal of single payer financing, let us make a down-payment now by expanding Medi-Cal coverage to all Californians up to age 26, regardless of their immigration status.

But access is only part of the solution. Cost is another.

We must address rising costs throughout the system, like the consolidation of hospitals and other health providers, which limits patient choice and makes care more expensive. And we must continue to bring down the cost of prescription drugs.

My first act as Governor was to lay the foundation for a single-purchasing system – the largest such system in the nation, which will save hundreds of millions of dollars a year for the people of California.

I want to thank President Trump for calling attention to prescription drug prices in his State of the Union. Yes, you heard that right. I hope he follows through. After all, this should be a bipartisan issue. But with or without the Federal government, California will lead.

https://www.gov.ca.gov…

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Comment:

By Don McCanne, M.D.

“As we pursue the long-term goal of single payer financing…” That is the take-home message of California Governor Gavin Newsom in his first State of the State Address.

In the meantime, there are several things that can be done to expand coverage and rein in costs. and Gov Newsom has proposed some of them.

Covered California (California’s ACA exchange) was made less effective by the Trump administration’s cancellation of the individual mandate penalty. As a transitional measure, Newsom would create a California individual mandate, until we have a single payer system.

He recommends expanding subsidies to middle-income families who still struggle with health care costs yet were not granted eligibility for the ACA subsidies. Although this does increase administrative complexity, it does provide some transitional relief until we have a single payer system.

California pays amongst the lowest rates for Medicaid, and he would increase those rates to help address the provider shortage – again helpful in providing some transitional relief until we have a single payer system.

He would expand Medicaid coverage to all Californians up to age 26, regardless of their immigration status, helping to fill in one of the more important voids in health care coverage, thereby providing some transitional relief until we have a single payer system.

He would increase access to preventative health measures like immunizations, trauma screenings, and mental health services, while authorizing $100 million for reproductive health and family planning, again providing some transitional relief until we have a single payer system.

One of the more important features of a single payer system is that it functions as a monopsony – a single purchaser that has more leverage in ensuring that prices are optimal. He would “lay the foundation for a single-purchasing system – the largest such system in the nation, which will save hundreds of millions of dollars a year for the people of California” – again providing some transitional relief until we have a universal single payer system.

Incrementalists, please note. These are not incremental steps moving toward some nebulous, aspirational goal of Medicare for All. These are merely interim measures to provide transitional relief while we move full speed ahead in demolishing the political barriers lying between us and health care nirvana: a single payer national health program – Single Payer Medicare for All. That includes everyone, folks. Everybody in, nobody out.

Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.

America’s Health Insurance Plans (AHIP), February 7, 2019

368 bipartisan leaders in Congress signed their support for the Medicare Advantage program. On behalf of the nearly 22 million Americans who depend on Medicare Advantage, America’s Health Insurance Plans (AHIP) thanks the 66 members of the United States Senate and the 302 members of the House of Representatives who signed bipartisan letters to express their strong support for the program.

This letter was sent to Administrator Seema Verma at the Centers for Medicare and Medicaid Services (CMS).

http://www.ahip.org…

Letter from the Senate, with 66 signatures:
https://www.ahip.org…

Letter from the House, with 302 signatures:
https://www.ahip.org…

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‘Cloud of secrecy’ in Medicare Advantage plans can create an environment for fraud

By Jeanne A. Markey and Raymond M. Sarola
STAT, February 8, 2019

Over the last two decades, federal and state governments have dramatically increased their payments to private health care companies that manage Medicare Advantage and Medicaid managed care plans, now paying them around $400 billion a year.

Although these companies take in a tremendous amount of taxpayer money, and have immense power regarding how to distribute these funds, a cloud of secrecy shields from public view their financial operations and profitability. The unique environment in which Medicare Advantage and Medicaid Managed Care plans operate — enormous amounts of money to be spent, a thicket of government reimbursement guidelines, little transparency, typically no party with equal bargaining power, and what amounts to an honor system — can create a recipe for cooking up fraud.

Unlike the traditional Medicare fee-for-service approach, Medicare Advantage is a capitated payment system. These private companies receive from the government a fixed amount of money per patient (depending on the patient’s health), make payments to providers for that patient’s covered services, and keep the difference as their profit. Medicaid Managed Care programs operate in a similar way under state Medicaid programs.

Capitated payments provide a profit motive to Medicare Advantage and Managed Care companies to operate efficiently and rein in overall health care spending. In practice, though, this payment structure can also provide incentives for companies to unlawfully increase their profits by manipulating cash flows on both ends of the equation. At one end, they can represent to the government that their patient population is less healthy than it is, and thereby obtain artificially increased capitation payments. At the other end, they can pay providers less than they are obliged to in order to maximize the cash they retain.

Given the complexity of Medicare Advantage and Medicaid Managed Care plans, many types of fraud can occur. In addition to inflating patient diagnoses and performing one-way reviews, companies can deny covered benefits and underpay providers, lie about patient demographics, and manipulate reported administrative costs.

In September 2018, the federal government issued a report that revealed another type of fraud in this area: “widespread and persistent performance problems related to denials of care and payment.” This report found that Medicare Advantage organizations improperly denied coverage for health care services in many cases, and forced patients to endure lengthy appeals processes to obtain their proper coverage. The types of fraud that can arise are likely to increase over time.

When companies that manage Medicare Advantage and Medicaid managed care plans receive hundreds of billions of dollars from the government on what is basically an honor system without sufficient transparency into how that money is spent or retained, fraud almost always ensues.

https://www.statnews.com…

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Comment:

By Don McCanne, M.D.

The next time you hear a politician claim to support Medicare for All, it might be wise to ask if that includes supporting the private Medicare Advantage plans. The insurance lobby organization, America’s Health Insurance Plans (AHIP), has collected the signatures of 368 members of Congress for letters to encourage the Centers for Medicare and Medicaid Services to further nurture the private Medicare Advantage plans that are already displacing the traditional Medicare program – now about 40 percent.

The plans are popular primarily because there is no need to purchase an additional Medigap plan. Much has been written about the perversities of these private plans, but most of the deficiencies remain out pf the view of the enrollees. Just as a reminder, excerpts from the STAT article, “Cloud of Secrecy,” explain how “fraud almost always ensues.”

The only model with Medicare for All label that achieves the goals of reform (universality, equity, efficiency, affordability) is the single payer model that eliminates private plans. Yet many politicians who professed to support single payer Medicare for All are now backtracking by stating that private health plans should remain as an option. This is a clear rejection of single payer since most of the efficiencies and the egalitarianism of single payer are lost under a multi-payer system that includes private insurers.

Of particular concern is this overwhelming endorsement by members of Congress of the private Medicare Advantage plans which automatically eliminates any consideration of a bona fide Single Payer Medicare for All program.

You might want to check the signatures on the two letters to see if the names of your members of Congress are listed. If so, you might also want to share your thoughts with them.

Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.

By Matthew Sheffield
The Hill, February 7, 2019

A new poll finds that about only one in 10 registered voters want the equivalent of Medicare for all if it means abolishing private health insurance plans.

In a Hill-HarrisX survey released Thursday, 13 percent of respondents said they would prefer a health care system that covers all citizens and doesn’t allow for private plans, an approach that is sometimes referred to as “single-payer.”

The most popular option, at 32 percent, consisted of a universal, government-operated system that also would allow people to buy private, supplemental insurance.

Twenty-six percent of respondents said they wanted a government insurance plan offered to all citizens, but one that doesn’t compel people with private plans to use it, a system sometimes called a “public option.”

A small minority of 15 percent of voters said they wanted the government to completely remove itself from paying for health care, while another 14 percent said they want to keep the existing health care system intact.

The Hill-HarrisX survey was conducted among a statistically representative sample of 1,001 registered voters from Feb. 1-2. It has a sampling margin of error of 3.1 percentage points.

The Hill-HarrisX Daily Poll

Which of the following comes closest to your view?

15% – The government should remove itself from paying for all health care

14% – The current healthcare system should be kept as is

26% – Any citizen should be able to sign up for Medicare/Medicaid regardless of age or income while those with private plans could keep their existing insurance

13% – Medicare/Medicaid should be expanded to cover all citizens regardless of age or income and private health plans should be abolished

32% – Medicare/Medicaid should be expanded to cover all citizens regardless of age or income but people should be able to purchase private supplemental plans

https://thehill.com…

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Comment:

By Don McCanne, M.D.

This survey is important because it is being cited by others as proof that voters want to be able to keep their private insurance plans, and thus they believe that politicians are stretching too far when they support a single payer version of Medicare for all that would eliminate all private insurance.

Actually these results are not that straightforward. Those surveyed were given five choices, and that means that each choice would average 20 percent support. For any option to approach 100 percent support, almost everyone would have had to reject the other four choices. That would be highly unlikely in any poll in which the advantages and disadvantages of each option are not that clear.

Three of the choices included a base of Medicare/Medicaid. That alone can be confusing since many people are aware that Medicaid is a welfare program for low-income individuals and there would be some reluctance to choose a welfare program to apply to everyone as either an option for enrollment or as a mandated plan.

The Medicare/Medicaid option that allows people to sign up voluntarily or keep their existing private plan corresponds to the public option proposal being bantered about, although many might not make that association, nor even know what the ramifications of the public option would be. One-fourth selected this choice.

One of the other two Medicare/Medicaid options is a mandated program that includes everyone and would allow individuals to purchase additional private supplemental plans. That is not unlike our current program of allowing Medicare beneficiaries to purchase a supplemental Medigap plan. By implication, this seems to assume that the proposed Medicare/Medicaid program leaves people exposed to financial risk unless additional coverage is obtained. Thus it is perplexing that this was the most popular choice – with one-third selecting it. Why would people select a plan that would require the purchase of additional coverage to ensure adequate financial security?

The other Medicare/Medicaid mandated plan seems scary to some because it would abolish private health plans with which most of us are very familiar. This fear made this the least popular choice – at 13 percent – and thus led to the title of the article in The Hill. Only 13 percent want Medicare for All if it means the end of private insurance. The irony is that this is the choice that is closest to Single Payer Medicare for All in which everyone is guaranteed health care for life which is affordable – the least expensive model of comprehensive reform – and allows free choice of health care professionals and institutions. The need for private health insurance, with all of its inefficiencies, extra costs, and administrative excesses, is eliminated.

The other two unpopular choices were keeping the system as it is and removing the government from paying for health care. Apparently the public does understand that the system needs to be changed and that the government should be involved in the financing. Seventy-one percent chose one of three Medicare/Medicaid options – presumably a proxy for government involvement.

Although the politicians campaigned on Medicare for all, they are very busy backpedaling now by denying that they would abolish private insurance. Surely they understand that keeping private insurance as an option destroys most of the benefits of the single payer model – universality, equity, administrative efficiency, comprehensiveness, accessibility, and affordability. By keeping private insurers in place, collectively we pay more and get less. That’s not what we want, or at least it shouldn’t be.

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