Why Single Payer Health Care is Best Approach

Bruce Thompson’s recent article, “The Case for Single Payer Care”, starts a much needed discussion on the possibility of a single payer health insurance system (or as Bernie Sanders has popularized it, “Medicare for All) in the United States. Recent polling by Reuters suggests that the support for Medicare for All is growing rapidly in the United States, with over 70% of Americans supporting the policy (including 52% of Republicans). Single Payer is finally beginning to receive serious media attention.

Much to my chagrin, however, Thompson concludes his article by finding a single payer program unfeasible on both the policy and political level and expressing his support, instead, for a compromise policy called “Medicare Buy-In”. In this response, I hope to clarify a few misconceptions about what exactly constitutes “single payer” and to argue that a comprehensive single payer program has significant strengths, as both a policy and a political strategy, that half-hearted reforms like Medicare Buy-In lack.

What Exactly is Single Payer?

Simply put, a country has single payer system when it creates one single health insurance plan that covers all citizens. If there are multiple insurers (or “payers”), there is no longer a single payer and therefore that society does not have a “single payer system.”

Thompson is confused about this crucial point. For instance, he states that “[Senator Bernie] Sanders envisions single payer as replacing all forms of health insurance.” Senator Sanders did not originate some novel vision of single payer: this is just the definition of a single payer system. Similarly, Thompson ends his article by promoting his preferred plan, “a model that allows employer insurance and single payer to co-exist.” Again, this is a contradiction in terms as a country that has both a government run insurance program (like Medicare) as well as hundreds of private insurance plans does not have “single payer” – it has “multiple payer.”

While these definitional discussions may appear dry, they are essential for understanding why single payer offers unique benefits that will be discussed below, including guarantees of universal coverage, massive administrative cost savings, the market power necessary to muscle down pharmaceutical and hospital prices, and a reduction in overall bureaucracy.

Achieving Universality

One of the central political debates over the last decade has been how to design a program that can provide health insurance coverage for all Americans (i.e., “universal coverage”). In 2007, then Senator Obama delivered a speech where he stated, “the time has come for universal health care.” Unfortunately, his signature legislative achievement, the “Affordable Care Act”, failed to achieve universal coverage, leaving 27 million Americans uninsured and 41 million Americans underinsured.

In contrast, Senator Sanders’ Medicare for All bill (S.1804) would explicitly cover all Americans from birth to death by lowering the Medicare enrollment age from 65 to 0. This is real universal coverage. No American would ever have to worry again about choosing an insurance carrier, losing insurance coverage, or switching insurance companies. There would be no networks, because all hospitals and clinics would have to accept the single insurance card that all Americans would hold. All Americans would have coverage for life.

Thompson’s proposed plan (allowing individuals the option to “buy-in” to Medicare) would fail to achieve universality because it relies on millions of Americans making complicated and expensive insurance decisions on a yearly basis. Some of these people, through neglect or financial duress, will not buy insurance. Notably, in addition to not achieving universality this plan would continue making Americans worry annually about their insurance coverage (a huge hassle!), lose and switch insurance coverage on a routine basis, and navigate restrictive health care networks.

If your goal is universality, Medicare for All is the superior policy.

Can we afford to have single payer? Can we afford not to have single payer?

One superficial (and typically bad faith) criticism of single payer is that it will cost too much money. Media reports often report the large increase in federal spending that a single payer plan would require. Thompson accurately describes how this viewpoint is misleading: under single payer, “the increase in federal government expenditures” is “due to the conversion of private spending into government spending.” More simply, money that Americans currently spend as “premiums” would now be spent as “taxes.” Keeping all things the same, federal expenditures would go up by about the same amount that private insurance expenditures would go down.

However, Thompson believes, based on an Urban Institute study, that single payer will cause overall health care spending to rise. This is a controversial statement. Single payer would massively decrease health care bureaucracy (estimated savings of over $200 billion per year), allow the government to negotiate with pharmaceutical companies (the VA currently negotiates 50% reductions in price), and provide significant leverage to lower prices at hospitals. As always in politics, competing think tanks will put out contradictory numbers. But based on both the international experience with single payer as well as estimates from the Congressional Budget Office, the Government Accountability Office, and many academic experts, there is significant evidence that single payer would reduce overall health spending. Even if the significant savings touted by many single payer promoters did not accrue, single payer would cover 27 million more Americans without significantly increasing national health care costs.

What about people who like their private insurance?

Thompson’s core criticism of Medicare for All is that it would require individuals who currently have private insurance to change plans. As Matt Bruenig of People’s Policy Project persuasively explains, there is no reason to be concerned by this criticism. First, people with private insurance change insurance coverage constantly. As Bruenig reminds us, “Twenty million people were fired or laid off last year from jobs and another forty million quit or separated from their job for another reason…If we assume half of these job separators had employer-provided healthcare, then that means the current system of employer-provided health insurance pushes 150 million people off their employer-provided health insurance every 5 years.” So much for stability!

Secondly, all Americans will eventually switch to Medicare anyway, so why would they care if they switched tomorrow instead of at age 65. If anything, this would minimize the chances that their employer would force them to switch insurance plans arbitrarily in the decades prior to retirement.

Finally, millions of Americans switch from private insurance coverage to Medicare every year when they turn 65. You do not hear cries of dismay with this transition because the vast majority of retirees appreciate having guaranteed universal coverage for the rest of their lives. Polls show that Americans with VA or Medicare coverage have the highest satisfaction with their insurance coverage.

Again, a true single payer plan is a stronger policy than half-hearted reforms: it will reduce the amount of health insurance churn that Americans experience. As a 29 year old who has switched health insurance (and consequently switched between networks of doctors and hospitals) five times in the last seven years, I can attest that this is a real benefit and a superior policy.

The Missing Arguments

As someone who regularly canvasses neighborhoods to build support for Medicare for All, I believe there are two final benefits to Single Payer that Thompson ignores. First, it is a simple plan, easy to understand and easy to explain. As I tell Wisconsinites on their doorsteps every month, “A full fledged Single Payer (or Medicare for All) bill would lower the age of enrollment of Medicare from 65 to 0; all residents of the United States would be covered for life; coverage would be comprehensive, including long-term care, dental, and reproductive care; copays, bills, and deductibles would be eliminated; and we would pay for it together, as a society, through progressive taxation.”

Secondly, and most importantly, it is a moral argument. Medicare for All should exist because it is wrong to let the sick suffer when they could be treated, it is wrong to tax those who are ill and vulnerable (what else is a copay, if not a tax on the sick?), and it is wrong to expose our neighbors to insecurity and fear about their health insurance coverage on an annual basis. In a society as wealthy as ours, we can and should provide health care to everyone – and we should do so without inspecting each citizen’s wallet first.

Expanded and Improved Medicare for All (or Single Payer) is a superior policy, able to actual provide universal coverage, minimize bureaucracy, and reduce wasteful spending. But it is also better politics. It improves peoples lives, it gives them security and a direct material benefit, it reduces the hassle and bureaucracy that builds cynicism in citizens, and it offers the potential to direct political action along morally persuasive grounds.

Mark Kelly is a 4th year medical student at the University of Wisconsin and co-chair of Democratic Socialists America – Madison’s Medicare for All Working Group.