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“Ryancare” Dead on Arrival: Can We Please Now Try Single Payer?

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Photo by DonkeyHotey | CC BY 2.0

Photo by DonkeyHotey | CC BY 2.0

The Canadian plan also helps Canadians live longer and healthier than Americans. . . . We need, as a nation, to reexamine the single-payer plan, as many individual states are doing.

— Donald Trump, The America We Deserve (2000)

The new American Health Care Act has been unveiled, and it has been pronounced an even greater disaster than Obamacare. Dubbed “Ryancare” or “Trumpcare” (over the objection of White House staff), the Republican health care bill is under attack from all sides, with even conservative leaders calling it “Obamacare Lite”, “bad policy”, a “warmed-over substitute,” and “dead on arrival.”

The problem with both bills is that they are trying to fund a bloated, inefficient, and overpriced medical system with dwindling taxpayer funds, without capping its costs. US healthcare costs in 2016 averaged $10,345 per person, for a total of $3.35 trillion dollars, a full 18 percent of the entire economy, twice as much as in other industrialized countries.

Ross Perot, who ran for president in 1992, had the right idea: he said all we have to do is to look at other countries that have better health care at lower cost and copy them.

So which industrialized countries do it better than the US? The answer is, all of them. They all not only provide healthcare for the entire population at about half the cost, but they get better health outcomes than in the US. Their citizens have longer lifespans, fewer infant mortalities and less chronic disease.

President Trump, who is all about getting the most bang for the buck, should love that.

Hard to Argue with Success

The secret to the success of these more efficient systems is that they control medical costs. According to T. R. Reid in The Healing of America, they follow one of three models: the “Bismarck model” established in Germany, in which health providers and insurers are private but insurers are not allowed to make a profit; the “Beveridge model” adopted in Britain, where most healthcare providers work as government employees and the government acts as the single payer for all health services; and the Canadian model, which is a single-payer system but the healthcare providers are mostly private.

A single government payer can negotiate much lower drug prices – about half what we pay in the US – and lower hospital prices. Single-payer is also much easier to administer. Cutting out the paperwork can save 30 percent on the cost of insurance. According to a May 2016 post by Physicians for a National Health Program:

Per capita, the U.S. spends three times as much for health care as the U.K., whose taxpayer-funded National Health Service provides health care to citizens without additional charges or co-pays. In 2013, U.S. taxpayers footed the bill for 64.3 percent of U.S. health care — about $1.9 trillion. Yet in the U.S. nearly 30 million of our citizens still lack any form of insurance coverage.

The for-profit U.S. health care system is corrupt, dysfunctional and deadly. In Canada, only 1.5 percent of health care costs are devoted to administration of its single-payer system. In the U.S., 31 percent of health care expenditures flow to the private insurance industry. Americans pay far more for prescription drugs. Last year, CNN reported, Americans paid nearly 10 times as much for prescription Nexium as it cost in the Netherlands.

Single payer, or Medicare for All, is the system proposed in 2016 by Democratic candidate Bernie Sanders. It is also the system endorsed by Donald Trump in his book The America We Deserve. Mr. Trump confirmed his admiration for that approach in January 2015, when he said on David Letterman:

A friend of mine was in Scotland recently. He got very, very sick. They took him by ambulance and he was there for four days. He was really in trouble, and they released him and he said, ‘Where do I pay?’ And they said, ‘There’s no charge.’ Not only that, he said it was like great doctors, great care. I mean we could have a great system in this country.

Despite what you may have heard in the presidential debates, the single-payer plan of Bernie Sanders would not have bankrupted the government. To the contrary, according to research by University of Massachusetts Amherst Professor Gerald Friedman, it would have generated substantial savings:

Under the single-payer system envisioned by “The Expanded & Improved Medicare For All Act” (H.R. 676), the U.S. could save $592 billion – $476 billion by eliminating administrative waste associated with the private insurance industry and $116 billion by reducing drug prices . . . .

According to OECD health data, in 2013 the British were getting their healthcare for $3,364 per capita annually; the Germans for $4,920; the French for $4,361; and the Japanese for $3,713. The tab for Americans was $9,086, at least double the others. With single-payer at the OECD average of $3,661 and a population of 322 million, we should be able to cover all our healthcare for under $1.2 trillion annually – well under half what we are paying now.

That is true in theory; but governments at all levels in the US already spend $1.6 trillion for healthcare, which goes mainly to Medicare and Medicaid and covers only 17 percent of the population. Where is the discrepancy?

For one thing, Medicare and Medicaid could be had for less than we are paying now. Our single-payer plans are more expensive than in other countries, because the US government has been prevented from negotiating drug and hospital costs to the extent done elsewhere. In January, a bill put forth by Sen. Sanders to allow the importation of cheaper prescription drugs from Canada was voted down. Sanders is now planning to introduce a bill to allow Medicare to negotiate drug prices, for which he is hoping for the support of the president. Trump indicated throughout his presidential campaign that he would support that approach, and said in January that the pharmaceutical industry is “getting away with murder” because of what it charges the government.

Medicare costs are also higher than in single-payer countries because we use more medical technology, including more expensive diagnostic equipment. Tests must be run to recoup those costs, whether or not the patients really need them.

Why Is Our Collective Health Worse Than in Other Countries?

Drug and technology costs aside, the US tab seems to be higher than elsewhere just because Americans are sicker than people in other industrialized countries. We have shorter life spans and more chronic disease, despite the most expensive healthcare in the world. Forty-eight percent of U.S. men and 38% of women can now look forward to getting cancer. A third of American children suffer from chronic disease, eight percent suffer from serious food allergies, 10% from asthma, 17% are diagnosed with learning or behavior disabilities, almost two percent from autism, and a third of low-income preschool kids are already overweight or obese. Heart disease, diabetes, mental illness, cancer, and obesity rates are sharply up in all sectors of the population. What is making us so unhealthy?

It’s not smoking. People in other industrialized countries actually smoke more than Americans. In fact the Japanese, with the highest life expectancy among industrialized countries, smoke 75 percent more cigarettes than people in the US.

It is also not lack of exercise. People in most industrialized countries are more sedentary than people in the US. Nor does it appear to be our stress levels, which are not much different from those in other comparable countries.

There are, however, several variables in which we easily outdistance every other industrialized nation. We eat more genetically modified (GMO) foods, we give more and stronger vaccines to children, and we have far more obesity. More than a third of adults in the U.S. were obese in 2012. Out-of-control obesity levels appear to be a function of the deficient American diet. Not getting the nutrients we need from our over-processed, microwaved, genetically-modified, glyphosate-laden “fast food” and “junk food,” Americans are constantly hungry. Hormones given to livestock to fatten them are also making people fatter.

Another suspicious variable is the American healthcare system itself. US medical care is all about treating symptoms rather than the underlying causes of chronically poor health. There is little profit to be extracted from quick, effective cures. The money is in the drugs that have to be taken for 30 years, killing us slowly. And they are killing us. Pharmaceutical drugs taken as prescribed are the fourth leading cause of US deaths, after heart disease, cancer and stroke.  

Lured by drug advertising, Americans are popping pills they don’t need, with side effects that are creating problems where none existed before. The US is the only industrialized country besides New Zealand that allows drug companies to advertise pharmaceuticals. Big Pharma spends more on lobbying than any other US industry, and it spends more than $5 billion a year on advertising. Although Americans comprise only 5 percent of the world’s population, we consume fully 50 percent of Big Pharma’s drugs and 80 percent of the world’s pain pills. We not only take more drugs (measured in grams of active ingredient) than people in most other countries, but we have the highest use of new prescription drugs, which have a 1 in 5 chance of causing serious adverse reactions after they have been approved.

The death toll from prescription drugs is 128,000 Americans per year. As Jon Rappaport observes, with those results Big Pharma should be under criminal investigation. But the legal drug industry has grown too powerful for that. According to Dr. Marcia Angell, former editor in chief of the New England Journal of Medicine, writing in 2002:

The combined profits for the ten drug companies in the Fortune 500 ($35.9 billion) were more than the profits for all the other 490 businesses put together ($33.7 billion). Over the past two decades the pharmaceutical industry has [become] a marketing machine to sell drugs of dubious benefit, [using] its wealth and power to co-opt every institution that might stand in its way, including the US Congress, the FDA, academic medical centers, and the medical profession itself.

Drug companies are driven by profit, and their market is sickness – a market they have little incentive to shrink. As observed by Ronnie Cummins, International Director of the Organic Consumers Association, in February 2017:

. . . [B]ig pharmaceutical companies, for-profit hospitals and health insurers are allowed to jack up their profit margins at will. . . . Simply giving everyone access to Big Pharma’s overpriced drugs, and corporate hospitals’ profit-at-any-cost tests and treatment, will result in little more than soaring healthcare costs, with uninsured and insured alike remaining sick or becoming even sicker.

US healthcare costs are projected to grow at 6 percent a year over the next decade. The result could be to bankrupt not only millions of consumers but the entire federal government. Obamacare has not worked, and Ryancare is not likely to work. As demonstrated in many other industrialized countries, single-payer delivers better health care at half the cost that Americans are paying now.

Winston Churchill is said to have quipped, “You can always count on the Americans to do the right thing after they have tried everything else.” We need to try a thrifty version of Medicare for All, with negotiated prices for drugs, hospitals and diagnostic equipment. It’s just good business.

Ellen Brown is an attorney, founder of the Public Banking Institute, and author of twelve books including the best-selling Web of Debt. Her latest book, The Public Bank Solution, explores successful public banking models historically and globally. Her 300+ blog articles are at EllenBrown.com.

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