Is a Single-Payer Healthcare Option Gaining Momentum?

Update: September 2017 - Democrat Max Baucus, who as head of the Senate Finance Committee in 2009-10 wanted nothing to do with including a single-payer option within the Affordable Care Act (ACA), has had a change of heart. The former Montana Senator is warming to the idea of a single-payer system and has added his voice to the growing number of Americans who believe that such an option should be considered.

According to the Bozeman Daily Chronicle, Mr. Baucus spoke recently at Montana State University and said, "My personal view is we've got to start looking at single-payer. I think we should have hearings…we're getting there. It's going to happen." The Senator also was critical of the high prices Americans pay for drugs today, spoke favorably of the administrative efficiencies achieved in Canadian hospitals relative to those in rural Montana, and characterized the Trump/GOP attempt to undermine the ACA as "tragic".

(Single Payer Action's take on the issue)

June 2017 - With recent Republican efforts to reform our healthcare system generating widespread criticism and derision from across the political spectrum, there is more talk again about looking at a single-payer, or "Medicare for All", healthcare option.

Two unlikely sources of support for single-payer recently have expressed interest in having a public dialogue about the concept. Charlie Munger, a Republican who runs Berkshire Hathaway along with Warren Buffett, said in a recent interview that "The whole {healthcare} system is cockamamie. It's almost ridiculous in its complexity and it's steadily increasing cost... It gives our companies a big disadvantage in competing with other manufacturers. They've got single-payer medicine and we're paying it out of the company."

According to Bob Bryan's May 14 Business Insider article, Mr. Munger subsequently agreed with Warren Buffett and said he supported moving the country toward a single-payer system. Mr. Buffett regularly points to the fact that the US spends over 17% of it's GDP on healthcare, much more than is spent by the rest of the western world, and yet our health metrics tend to fall below those of these other countries.

Perhaps even more surprising than Mr. Munger's comments, though, were those of Aetna CEO Mark Bertolini. Aetna is one of the country's five largest health insurers, but Mr. Bertolini reportedly is open to discussing the idea of a single payer option, with the government providing the financing and companies like Aetna providing the back-office operations.

(image from lakefreeclinic.org)

At a recent Aetna employees meeting, he is quoted as having said, "If the government wants to pay all the bills, and employers want to stop offering coverage, and we can be there in a public private partnership to do the work we do today with Medicare, and with Medicaid at every state level, we run the Medicaid programs for them, then let's have that conversation."

This type of public-private partnership is how a number of other western democracies have been able to provide universal health coverage to their citizens while moving financing away from their business sector. The latter has resulted in improved business efficiency and competitiveness around the world.

Of course, many conservatives aren't going to sit back and let a single-payer plan gain momentum without a fight. We're sure that the millionaire talking heads on the right like Rush Limbaugh (who are rich enough to afford as much oxycotton, legal or illegal, as they'd like) will start railing against "socialized medicine" and the fact that "even President Obama wouldn't go so far as single-payer".

Could we be so lucky that a serious discussion of single-payer finally will get conservatives to admit that Mr. Obama's Affordable Care Act really was a Republican solution to our healthcare crisis (see our Health Care section article, "Obamacare: The GOP Was For It, Before They Were Against It",) and instead of trying to repeal it, embrace it as a Republican market-based approach that just needs some tweaking to make it work even better?

Regardless of whether we get that desirable outcome, we do agree with Mark Bertolini: let's start having that single-payer discussion as a nation. Perhaps, at a minimum, the result we achieve will be to join the rest of the western world in viewing healthcare as a right for all Citizens.

Update: August 2018 - The Koch Brothers' Study of Senator Sanders' "Medicare for All" Proposal

Charles Blahous of the libertarian, Koch-funded, Mercatus Center at George Mason University recently published a study of Bernie Sanders' single-payer "Medicare for All" healthcare proposal. Republican allies of the Kochs quickly jumped on the study's estimate that such a plan would cost the federal government $32.6 trillion dollars over the next ten years, and argued that such a number made the plan unworkable.

Senator Sanders and other supporters of a "Medicare for All" system (including a number of Democrats who may run for President in 2020) responded that the Blahous study also showed that the single-payer approach would reduce total U.S. healthcare costs over that same period by $2 trillion. They argued that the study supports Senator Sanders' position and actually makes the case for a single-payer system.

So how should we assess what the Blahous study is saying? Assuming all of Mr. Blahous' numbers are reasonably accurate, we think Rick Newman, senior economic columnist for Yahoo News, put it nicely into perspective. Here's a summary of Mr. Newman's analysis:

Let's start by rounding the ten-year $32.6 trillion price tag to $3.3 trillion per year. Since total federal outlays this year are ~$4.2 trillion, moving healthcare funding to the federal government would significantly increase the federal budget and require additional taxes/fees to fund it.

The key word in that last sentence is "moving". Health care costs today are borne primarily by American businesses, individuals, and the states. The costs borne by those entities would disappear under a Medicare for All plan. And the federal taxes/fees that would replace those costs would be $2 trillion less than those costs, a significant gain to the country as a whole. The sticking point would be where those taxes/fees would fall although Mr. Newman presents some interesting numbers specific to American business.

He starts by reminding us of the viewpoint expressed by billionaire businessman Warren Buffett, who describes today's health care funding by U.S. companies as the "tapeworm of American competitiveness." Mr. Buffett feels this way because, as Mr. Newman puts it, "it forces American firms to bear a costly bureaucratic burden their foreign competitors don't have to deal with."

Mr. Newman continues with the following numbers: U.S. businesses provide health care to about 49% of the U.S. population and pay ~$1.2 trillion in health care costs each year. In contrast, this year's tax burden on U.S. business is estimated to be only $243 billion. Consequently, if we eliminated business health care expenditures, taxes on businesses could be quadrupled and, overall, American business still would come out ahead. We would argue that a similar analysis likely would hold true for the states and for individuals. Within each of these categories, there would be some entities who would make out better than others but, in total, we would be $2 billion ahead, according to the Blahous study.

There are plenty of details to be worked out when it comes to health care reform, but whether or not you agree that a Medicare for All approach is the best way to achieve quality health care for all Americans, we hope everyone can agree with Senator Sanders on this: "If every major country on earth can guarantee health care to all, and achieve better health outcomes, while spending substantially less per capita than we do, it is absurd for anyone to suggest that the United States cannot do the same."