Health Insurance
I listened to a podcast by Chris Hayes, the MSNBC commentator, called “Why is this Happening?.” Chris was interviewing Abdul El-Sayed, the former Director of Health for Detroit, and a candidate for Governor in Michigan. (if you have a 40 minute drive, it’s absolutely worth the time –Why is this Happening?)
There is a lot to talk about, but the interview helped me clarify some of the health care issues. The first was the difference between “single payer” insurance, and “nationalized medicine.” Single payer means that private providers (doctors, hospitals, pharmacies) are paid be a single “insurance” entity. It changes the health care cost equation in two ways.
First, it takes the “insurance entity,” “Medicare for all” for the sake of discussion, and makes it a powerful bargaining tool. Currently, large insurance companies bargain with providers for reduced costs. The larger the insurance company, the better the “deal”. We see this reflected in hospital bills, where we see a “retail” cost, a “charged” cost, as much as forty percent less, and the difference that the patient might have to pay. Those without insurance pay the “retail cost:” no wonder they go broke in a medical crisis.
A single payer “Medicare for all” plan would make the insurance provider a massively powerful bargainer. This is already recognized, as the GW Bush administration specifically prevented the current Medicare plan from negotiating for lower drug prices (Kaiser Family Foundation.) An expansion to “Medicare for all” should include the power to negotiate, while allowing for pharmaceutical companies to continue research. The “cost of the first pill” needs to be recognized, but the cost of stable and unchanged drugs, like insulin, should be controlled (Humalog insulin prices have tripled in the past decade – CBS.)
A single payer program could reduce medical costs. The United States has some of the best medical care in the world, but it also has the MOST expensive medical costs in the world. In 2016, the average medical cost per person in the United States was $10348. The next highest was Switzerland at $7919, while Germany, Austria, the Netherlands and Sweden were all in the $5000’s (Kaiser Family Foundation.)
A single payer system is NOT Nationalized Medicine (like the United Kingdom) or, dare I say it, “socialized Medicine.” The pharmacies, hospitals, and doctors remain private entities. A single payer system takes out the cost of insurance company profits (in 2017, the top six insurance companies made $6 Billion, up 29% from the year before, CNBC.) And while the health insurance companies, Anthem, United Health Care and the like, would be out of business, their employees would not be. They would still be needed to provide the services for the new “Medicare for All” program, just as CMS runs the current Medicare.
By the way, “Medicare for all” should NOT threaten existing Medicare. Republican Senator Roy Blount (MO) used the current fear-mongering catchphrase on Meet the Press this week, “Medicare for all will be Medicare for none.” This makes the invalid assumption that the current Medicare resources would have to deal with the incredibly expanded patient base of “Medicare for all.” But, of course, that wouldn’t be true, the resources would have to be expanded in conjunction with the patients. The Republican criticism is just a way to scare those “old folks” (I have two and a half years to go) who use and love Medicare now.
So a single payer system, well organized and staffed (like current Medicare) would reduce medical costs and remove a substantial cost in insurance company profits. But it wouldn’t be free. Medicare isn’t free now either.
Everyone with insurance pays something for it. In our current employer-based insurance environment, a portion of insurance cost is part of your “pay.” That part is paid directly by the employer, while the remaining costs are paid by the employee. Under “single payer” the employer no longer has an insurance responsibility. Employers could (whether they would or not) pay their “share” amount directly to the employee in wages, who would then “pay” for single payer through taxes. Estimates show that while “TAXES WOULD GO UP” (of course) payers would no longer pay the now continually rising cost of medical insurance, for a net decrease in cost to the individual.
Personally we have a great healthcare plan, the advantage of being retired government employees. We pay almost $5000 a year (for the two of us); it’s a great deal considering what the retail cost of insuring two retirees is. But we are in a unique position; there are many Americans who pay much more for less quality insurance, and many who cannot afford insurance (and can’t qualify for Medicaid.)
The cost of medical care is careening out of control. Our system may work for many of the 90% of Americans that have insurance, but the cost is increasingly steep. And for the 28 million Americans that don’t have insurance, it doesn’t work at all (US Census.) We need to look at alternatives without the scare tactics of loaded terms like “socialism” and “losing Medicare benefits.” We are paying more than the rest of the world for care, and that “more” is simply going to profit of hospital systems, insurance companies, and pharmaceutical firms. While We are a capitalist country and they have the right to a profit, it should not be at the expense of the health of Americans.
