Expanded Medicare for All: What It Is and What It’s Not

0 Flares Filament.io 0 Flares ×

Perhaps you’ve seen the video: a Vietnam veteran at a Bernie Sanders rally in Carson, Nevada takes the floor and describes how he is on the point of suicide due to the high uncovered costs of treating his Huntington’s disease. Or maybe you’ve read the recent press articles and TV news reports describing how people are dying due to rationing their insulin shots. The cost of insulin has skyrocketed, from $2,864 per patient per year in 2012 to $5,705 in 2016.

These are vivid reminders of how the current state of health care delivery in the United States kills people: kills them by virtue of inaccessibility, inadequate levels of coverage, and skyrocketing drug prices, among other deficit features. Is it any wonder that in survey after survey, people name health care as their primary concern—and not just the over 30 million that have no health insurance coverage?

And the cruel irony is that health care delivery in the U.S. is more expensive than in any other developed country. Despite the fact that our system covers fewer individuals, U.S. health care expenditures in 2017 accounted for 17.2 percent of GDP, while the next highest rate was Switzerland’s expenditures, at 12.4 percent.

Nor do higher costs lead to better outcomes. We have the highest maternal mortality rates, infant mortality rates, rates of chronic and preventable disease, and heart disease rates of any wealthy country in the world.

So absent better health outcomes, where is all that money going? Health care is a big business in the U.S. and not a human right, and this reality is reflected in the profit levels and approaches to compensation and administration that characterize the industry. Hospitals inflate their costs by acquiring other facilities and obtaining near monopoly power over local markets. Health insurance companies wastefully expand bureaucracies, hiring more claims and billings managers trained to restrict coverage. Hospital and insurance CEOs garner obscene salaries: an average health insurance executive makes $20 million per year. Roughly 30 percent of all healthcare costs in the country are administrative. In contrast, the government-run Medicare system only spends three percent of its revenue on administration.

These high costs and burdensome fees have led to windfall profits in the healthcare industry—profits that typically offer no benefit to the people who actually deliver health care services. The working conditions for doctors, nurses, and support staff in hospitals, clinics, and nursing homes are increasingly precarious, over-populated, and unsafe, while wages in the healthcare industry stagnate.

What is Medicare for All?

Clearly reform is needed, but of what type? Along with health care professionals, unions, and religious and community groups across the country, a new coalition in Champaign County maintains that expanded Medicare for All (Med4All) is the answer. Open to all local residents, the Illinois Single Payer Coalition: C-U supports both Senate Bill 1129, introduced by Senator Sanders, and House Bill 1384, introduced by Representative Pramilla Jayapal. Essential features of these bills include:

1) Improving existing Medicare by cost-sharing and eliminating gaps. Ending the need to purchase supplemental Advantage, drug, dental, or Long-Term Care (LTC) plans.
2) Offering coverage to all residents for inpatient, outpatient, Emergency Room, mental health, dental, vision, hearing, chiropractic, rehab, podiatry, prenatal and long term care, as well as prescription drugs and medical devices.
3) Ending co-pays, deductibles, and co-insurance. Eliminating all financial barriers to care and the burdens of medical debt and bankruptcy.

As Senator Elizabeth Warren has joined Sanders in supporting Med4All, there are now two frontrunners for the 2020 Democratic Party presidential nomination who endorse such a policy. But not all of their opponents are on board—most notably, the other frontrunner, former Vice-President Joe Biden, who prefers an approach to reform based on improving the Affordable Care Act. Other Democratic candidates push for a reform based on a mixed model, offering both a public option and private insurance.

Often based on false or misleading information, much of it provided and promoted by insurance and pharmaceutical representatives, the most common myths about Med4All warrant rebuttal.

Myth: Med4All will increase the direct costs that Americans pay for health care

Med4All would be paid for by a modest tax increase. This increase would be determined on a progressive basis according to income. Currently, an average working-class family pays nearly $6,273 a year in premiums. Under Med4All they would only pay $466 in taxes—saving over $5,000 per year.

Furthermore, when premiums are not deducted from paychecks, workers’ net wages will increase. Also, in collective bargaining contexts, unions will not be in a position of trading away a higher wage package for the costs of health coverage. Absent reform, as the ongoing UAW GM strike confirms, unions are often forced to strike over attempts by employers to cut costly health care benefits.

Myth: Med4All will increase the costs of delivering health care for the federal government

Even a study financed by the conservative Koch brothers admits that Med4All will actually reduce overall federal health care spending. Absent the reform, overall spending would amount to $49 trillion between 2017 and 2027, with the reform, the number would be $32.6 trillion.

Two important characteristics of Med4All would account for lower costs. First, administrative costs would be reduced by approximately $8.3 trillion over 10 years. Recall that the current Medicare program has administrative costs of only three percent, as opposed to the average private insurance figure of 30 percent.

Second, Med4All would allow the Secretary of Health and Human Services to negotiate drug prices across the board with pharmaceutical companies. At present, only the Department of Veterans Affairs can do so. The study estimates that this aspect of the reform would save $1.7 trillion over 10 years. But, given the fact that negotiating over drug prices will drastically reduce the pace of drug price increases, savings may be even higher.

Myth: Med4All will reduce choice and require Americans to give up private insurance programs they like. 

Med4All will not restrict choice for consumers of health care, but expand it. Most health insurance programs in the U.S. essentially compel consumers to access only a restricted network of providers and services. Going outside of a network leads to increased costs or, in the worst case, no coverage at all. Moreover, there is often an incredible amount of “churn” within these networks—often in relation to cost-cutting measures. An insurance-affiliated network in southern Illinois, for example, recently purged over 50 physicians from its network, leaving some patients with no choice but to no longer seek treatment with doctors they liked and trusted, and find a new provider. With Med4All, all health care professionals are accessible.

Many people also point to surveys indicating that Americans have high levels of satisfaction with their private insurance. But the reality is that while only six percent rate their Medicare coverage as poor to fair, the figure is 20 percent for employer-sponsored plan, and 33 percent for those purchasing their own insurance. Also, the whole question of satisfaction needs to be viewed in context. For many people—keenly aware of how many people have no insurance—their positive assessment of their insurance is really a form of saying, “Well, at least I’ve got coverage.”

Part 2 will appear in a future issue and will cover additional myths. If you have a question or concern on Med4All or want to check the data sources for this article, feel free to contact its author at pat.simpson@frontier.com. You can also use this email to find out more about joining the Illinois Single Payer Coalition: C-U.


This entry was posted in health care. Bookmark the permalink.