This week, Senator Bernie Sanders put forward a bill to give all Americans free health insurance.
The bill proposes that the federal government become the "single payer" of health care expenses, instead of the many different payers (private insurance companies, the federal government, state governments, etc) involved in our current health care system.
In this single-payer system, Americans' taxes would pay their medical bills, as opposed to payroll deductions or personal wealth. That's where things get tricky, because Sanders has not yet outlined how we would pay for virtually all medical care for 325 million people.
Why is it important?
Today, 155 million Americans receive health insurance through their employer, but the employer-funded system wasn't inevitable. In fact, you could say it was a historical accident. During World War II, President Roosevelt issued an executive order that prevented businesses from raising wages. The goal was to prevent inflation during the war. But it had an unintended effect: businesses began using benefits like health care to attract workers. In 1943, when the IRS made employer-provided health insurance tax deductible, it became the cheapest way a person could finance their health care. All this to say, our system isn't perfect and it wasn't preordained.
It's unlikely Sanders' bill will pass, but that's not really the key factor in this debate. More fundamentally, Sanders is trying to set up single-payer health care as our new goal for American health care. It begs the question...
Should a single-payer system be the goal for American health care?
The two presidents who made the most sweeping changes to health care in American history, Lyndon Johnson and Barack Obama, left employer-funded healthcare as the majority of the market for good reason.
The most important barriers to single-payer are not the "powerful special interests" Sanders cited in a recent New York Times op-ed.
The first is Americans' own legitimate fear of losing the coverage they now have—250 million people will lose their current coverage under Sanders' plan, ostensibly to be replaced by a government system they have yet to see formally laid out as a practical coverage option.
The second is the obvious problem of paying for it. Sanders' team does not even estimate how much it would cost in the first place, much less model how Americans' taxes would cover those expenses. Instead, the bill delegates important financial decisions to the Health and Human Services Department, like the creation of a national health budget. The most critical financial decisions in this plan would be left to an executive branch currently controlled by President Trump.
No proponent of single-payer adequately addresses these concerns, Sanders included. In his interview with Vox, Sanders claimed, "you go to the same doctor. You go to any damn doctor you want to go to." That answer is limited to the point of being irresponsible. He does not address the effects of an inevitable and enormous increase in demand as 30 million people get health care and all 325 million Americans are freed from any financial constraints.
Finally, there is no steady public support for a single-payer health care. Initially, 53% do say they favor single-payer. But remind them that it may require higher taxes and support plummets to 36%. Suggest that single-payer would "give the government too much control over health care" and support drops again. Americans aren't convinced.
A single-payer system is the best way to meet the ultimate goal we all can agree to: ensuring everyone can get the health care they need affordably and efficiently. Single-payer could finally achieve universal coverage in America and do it at a fraction of the price.
Imagine Sanders' plan in action: Americans use a "Universal Medicare" card to receive free health services—primary care, emergency care, prescription drugs, maternity care, dental care and more. (The full package is even more generous than other single-payer systems run by other developed countries.)
It would mean free health care for all Americans, and could be funded by a tax system that doesn't just replace premiums people are already paying but could put a greater share of the costs on high-income people.
A single-payer system could meaningfully reduce health care costs as the government negotiates drug prices and shrinks administrative overhead. According to a the Congressional Budget Office, administrative costs under Medicare are "less than 2% of expenditures, compared with approximately 11% of spending by private plans under Medicare Advantage. This is a near perfect apples-to-apples comparison of administrative costs, because the public Medicare plan and Medicare Advantage plans are operating under similar rules and treating the same population."
The public and many legislators agree. In 2014, Sanders proposed the same bill. Not a single one of his fellow legislators supported it. Today, one-third of Senate Democrats are co-sponsoring the bill. And, as of this June, 60% of Americans say the federal government is responsible for ensuring health care coverage for all Americans. More explicitly, 53% favor a single-payer plan.
As Sanders himself put it in an interview with Vox, "Should health care be guaranteed to all people? Most people say yes. Are we wasting an enormous amount of money in the current system? Most people would say yes."
- The text of Sen. Sanders' bill, the Medicare for All Act
- "There is hereby established a national health insurance program to provide comprehensive protection against the costs of health care and health-related services, in accordance with the standards specified in, or established under, this Act."
- The history behind employer-funded health insurance in the U.S.
- "After World War II, Europe was devastated. As countries began to regroup and decide how they might provide health care to their citizens, often government was the only entity capable of doing so, with businesses and economies in ruin. The United States was in a completely different situation. Its economy was booming, and industry was more than happy to provide health care.
- Sarah Kliff's explainer on the Medicare for All Act
- "Financing the health care system that Sanders envisions is an immense challenge. About half of the countries that attempt to build single-payer systems fail. That's Harvard health economist William Hsiao's estimate after working with about 10 governments in the past two decades. Whether he is in Taiwan, Cyprus, or Vermont, the process is roughly the same: Meet with legislators, draw up a plan, write legislation. Only half of those bills actually become law. The part where it collapses is, inevitably, when the country has to pay for it."
- Jeff Stein's interview with Sanders about the proposal
- Stein: "Sixty-one percent of Americans said that they're satisfied with their current health insurance plans. How does this bill — or how do you — plan on reassuring them that the care this bill would provide is either better [than] or comparable to what they currently have and like?"
- Sanders: "It’s not a question of switching plans... you know one of the lies that will be thrown out at us is that “this [is] government health care; you're gonna have to go to a government doctor.” Total nonsense. You go to the same doctor. You go to any damn doctor you want to go to. What's going to change is the wording on the card that you have. It will no longer be United Health Insurance or Blue Cross Blue Shield. It'll be Medicare-for-all."