Today we face the COVID-19 pandemic, with its resultant economic downturn and systemic racism—the triple crises that have exposed the serious problems of U. S. health care. It is now obvious to most observers that the system is broken, raising the question of how it can be put together through the political process after a hotly contested election season filled with disinformation and confusion about potential reform alternatives.
Corporatization, privatization, a shift from not-for-profit to for-profit health care, and the growth of investor-owned corporate health care have been dominant themes in the transformation of U. S. health care since the 1980s. We have seen a 3,000 percent growth in the numbers of administrators and managers compared to a minimal growth in the numbers of physicians.
The profit-driven medical-industrial complex continues to lead the way on the S & P 500 as the “system” raises prices to what the traffic will bear, limits choice and access to care, erodes our safety net, and leads to rampant profiteering, corruption and fraud. It has predictably failed us as we attempt to deal with the crises exposing the soft underbelly of our supposed system.
The increasing urgency for fundamental health care reform is shown by these indicators wrought by today’s triple crises and the inadequate response by the Trump administration:
+ More than 55 million uninsured Americans (including the uninsured before the pandemic) and 87 million underinsured.
+ Increased privatization (for profit) of public programs involving two-thirds of Medicare and three-quarters of Medicaid programs.
+ Private health insurers being allowed by the Trump administration to expand marketing of short-term plans, “junk insurance,” with very limited benefits of short duration without any protections for pre-existing conditions.
+ Long delays for newly unemployed workers to receive jobless benefits, with lack of oversight and transparency.
+ Shifting responsibility for health care to the states, allowing them to set premiums and other cost-sharing for Medicaid beneficiaries and impose lifetime caps on Medicaid benefits.
+ Decimation of the safety net, especially in lower-income urban settings and rural areas.
+ Relaxing regulatory standards at the FDA and EPA.
+ Budget cuts for Medicaid and Medicare, the Centers for Disease Control and Prevention (CDC), Social Security, Planned Parenthood, and other essential programs.
After all these years, the GOP has still not come up with its own health care plan, but their policies bear witness to their approaches to health care. They see no problem with corporate control in a multi-payer financing system, a profiteering medical-industrial complex, cost sharing for patients to have “more skin in the game,” and shifting responsibility from the federal government to the states. Without a health plan, the GOP just wants to kill the ACA and let the market’s supposed efficiency work its magic with minimal regulation.
We currently have three reform alternatives before us being contested in this election cycle. Let’s assess the advantages and disadvantages of each.
Build on the Affordable Care Act (ACA)
The ACA did bring health insurance to about 20 million previously
uninsured Americans, mostly through expansion of Medicaid in 31 states. It also set in place protections against private insurers denying coverage based on pre-existing conditions.
Ten years after its passage, however, the ACA is still just another Band Aid on a broken system far short of universal coverage. It has failed to control health care prices and costs, and leaves a profiteering private insurance industry in place. Private health insurance continues to be pricey and unaffordable for many, while disparities and inequities persist with many Americans still delaying or foregoing essential care.
Prior to this pandemic, employer-sponsored insurance (ESI) involved about 150 million workers, by far the largest group covered by private health insurance. But the pandemic has demonstrated the total inadequacy of ESI based on these facts:
+ The labor market is inherently unstable—by the time they reach age 50, Individuals have held an average of 12 jobs; 66 million left or lost jobs in 2018, with many not regaining insurance in another job.
+ ESI is increasingly expensive both for employers and employees, prompting employers to shift more costs to their employees, including ever increasing high deductibles, as employees pay more in lost wages. As a result, ESI has more gaps in coverage, and often cannot be relied upon when serious illness or accidents occur.
+ Small business, representing 88 percent of all businesses on Main Street with fewer than 20 employees and with less than $100,000 in annual revenue, had great difficulty in providing ESI before the pandemic and has been especially hard hit in its aftermath.
Medicare for Some; Variants of a Public Option
Many centrist Democrats have been promoting the advantages of one or another variant of the public option, which would in effect become Medicare for Some. These are the main variants:
+ Lowering the eligibility age for Medicare to 60, as favored by presidential candidate Joe Biden,
+ A Medicare buy-in public option plan for sale alongside private plans on the ACA exchanges,
+ A pay or play plan whereby employers could choose between purchasing private insurance or paying a payroll tax of about 8 percent, and
+ Expansion of privatized Medicare Advantage, labeled by critics as Medicare Disadvantage!
While seen by some as less disruptive and politically more achievable, Medicare for Some would fail to bring sufficient system reform for these reasons:
+ Would leave a failing private health insurance industry in place, with its administrative overhead four to five times higher than that of traditional Medicare.
+ No capacity for cost containment.
+ Lack of comprehensive benefits.
+ Added administrative complexity and bureaucracy.
+ Would fall far short and never reach universal coverage.
Medicare for All
This is the most logical and only alternative that can bring universal
coverage to accessible, affordable health care for our population. It is not a new idea. As a presidential candidate in 1912, T. R. Roosevelt included national health insurance in his platform, as did Harry Truman in 1948. FDR also included it in his New Deal program in the mid-1930s until he backed off because of strong opposition from the AMA.
The current bill in the House of Representatives, H. R. 1384, clarifies Expanded and Improved Medicare for All. When enacted, it will bring:
+ Universal coverage of comprehensive health care for all U. S. residents through a single-payer, publicly financed Medicare for All system of national health insurance (NHI).
+ Full choice of physician, other health care professionals, and hospital anywhere in the country.
Coverage of all medically necessary care, including outpatient and inpatient services; dental, hearing and vision care; laboratory and diagnostic services; reproductive health; maternity and newborn care; mental health services; prescription drugs; and long-term care and supports.
+ Elimination of cost sharing at the point of care, such as copays and deductibles, with no need to get pre-authorization through private insurers.
+ Administrative simplification with efficiencies and cost containment through large-scale cost controls, including (a) negotiated fee schedules for physicians and other health professionals; (b) global budgeting of hospitals and other facilities; and (c) bulk purchasing of drugs and medical devices.
+ Elimination of employer-sponsored health insurance and also the private health insurance industry with its onerous administrative costs and profiteering.
+ Allocation of 1 percent of its budget over the first five years for assistance and retraining of the estimated 1.7 million workers displaced by single-payer NHI.
+ Improved quality of care and outcomes for both individuals and populations due to universal access to essential care and increased funding for public health.
+ Regional funding for rural and urban areas that are medically underserved.
+ Shared risk for the cost of illness and accidents across our entire population of 330 million Americans.
+ Cost savings that enable universal coverage.
Gerald Friedman, Ph.D., professor of economics at the University of Massachusetts Amherst, has done ongoing studies of the costs of single-payer Medicare for All over the last 10 years. He finds that, had it been in place in 2019, we would have saved more than $ 1 trillion that year. Figure 1 shows how these savings would have occurred, in billions, for three areas of health care spending—provider administration (the billing process); payments to hospitals, drug companies and medical equipment manufacturers (through bulk purchasing and negotiated prices); and insurance administration (interaction with multi-payer insurers). Those savings are how we can afford Medicare for All, since the money is already there.
MEDICARE FOR ALL SAVINGS COMPARED TO CURRENT SYSTEM, 2019
Source: Friedman, G. The Case for Medicare for All. Polity Press, Medford, MA, 2020, pp. 62-63.
We have been repeatedly told over at least four decades that the free market will fix our system’s problems of access, costs, and quality of health care. That claim has been proven false by long experience. For-profit corporate stakeholders, often investor-owned, have demonstrated their commitment to profits over the public interest. The enormous medical-industrial complex that has evolved is a powerful barrier to reform, but the common good can be achieved if positive forces for change coalesce in this nodal crisis time requiring fundamental reform.
These claims by critics and opponents of Medicare for All can be readily refuted by evidence:
We can’t afford Medicare for All; it will bankrupt us.
We can’t afford the system we have. The private health insurance industry has been bailed out by subsidies from the federal government for many years, currently at $685 billion a year, projected by the Congressional Budget Office to double in another ten years. An excellent study by the Political Economy Research Institute at the University of Massachusetts Amherst projects that Medicare for All will save the U. S. $5.1 trillion over a decade through savings from replacing our for-profit market-based multi-payer financing system. Middle class Americans will see savings of up to 14 percent, while 95 percent of Americans will pay less than they do now for health care and insurance.
Medicare for All will be too disruptive.
This scare tactic by opponents ignores how disruptive private health insurance is now, with loss of insurance with job change or loss, narrowing networks, and insurers leaving unprofitable markets. The transition to traditional Medicare in the mid-1960s was seamless, even before computers.
NHI will be a government takeover.
Quite the contrary. Under NHI, physicians and other health care professionals will be enabled to stay in private practice, with simplified billing and less paper work. Private hospitals and other facilities will be stabilized during and beyond the pandemic with stable, year-to-year operating budgets.
NHI will bring rationing.
This claim totally ignores the rationing by ability to pay that plagues millions of Americans who can’t afford care when needed, delaying or forgoing care altogether with worse outcomes later on. NHI will remedy this problem.
Patients will lose choice.
This is absurd, since they will gain choice of physicians, other health professionals, hospital and other facilities, which they value much more than choice of insurer.
Physicians won’t like it.
A majority of physicians already support Medicare for All, beleaguered as they are with changing policies of health insurers, pre-authorizations, restricted networks, changing drug formularies, and other requirements related to reimbursement. Because of these administrative problems, which take so much time from patient care, a growing number of physicians are burning out and retiring early.
While we can expect powerful opposition to Medicare for All from corporate stakeholders in the medical-industrial complex, the status quo and the ‘old normal’ are no longer tenable. With the ongoing impacts of the triple crises, 2021 is a unique political moment when health care reform can be enacted. The stakes couldn’t be higher for Americans, the economy, and recovery beyond the pandemic. Do we have the political will to move to a ‘new normal’ with Medicare for All?