Would the addition of a public option to the US health care system bring down costs for patients?
November 13, 2020 at 8:04 AM - Views: 6 #377860eridaniParticipant
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However, there isn’t a magic number when, once hit, suddenly everyone is able to afford care and be covered. Every step taken squeezes people out. The only way to get everyone insured is through a single-payer system but, even then, it has to be more generous than the current Medicare plan. That being said, there doesn’t seem to be the political will or leverage to implement that.
The U.S. Congress — Democrats and Republicans alike — gives away benefits with a value that substantially exceeds what the users pay. Each beneficiary on average receives $310,000 more in benefits than they pay. The unpaid bills — $37 trillion at last count — have been kicked down the road to future generations in the form of bigger federal deficits. The Galen Institute reports that Medicare’s annual deficits are responsible for one-third of U.S. federal debt.
Yet, Medicare’s enormous scale confers genuine administrative and purchasing efficiencies. Medicare spends up to seven times less than private insurers on administrative costs. It also pays hospitals 40% less and providers 2 to 3.5 times less than private insurers pay for the same services. Some contend that providers merely shift Medicare and Medicaid’s unpaid charges to private insurers, but that charge has been refuted. Rather, it is plausible that these payments appropriately help to squeeze out the one-third of health care expenditures that many experts view as sheer waste.
Americans generally like both private insurance and Medicare but universally hate their costs. “Medicare for All” eliminates private insurers and increases taxpayers’ burden. The public option keeps private insurers and controls health care costs.
Comment by Don McCanne of PNHP: This is one of those situations where it is better to answer the question they should have asked rather than the one that they actually asked.
A Medicare-like public option that benefits from government-administered pricing and that is subsidized by the government obviously would bring down costs for patients who are enrolled in the program when compared to private commercial plans that are not government subsidized. But what about all of the other patients who are not enrolled in the public option? Some have suggested that competition from a public option might cause private plans to reduce their premiums, but they would do so by reducing their own costs through benefit reductions, increases in patient cost-sharing, and perhaps moving to more restrictive provider panels, shifting more costs to the patients, so any net cost reduction would be negligible.
Compare adding a public option to our current expensive, administratively complex, highly dysfunctional health care financing system to replacing the system with a well designed single payer system – an improved Medicare for All. Not only would everyone be covered with a high-performance system, the average costs for patients, except for the very wealthy, would be less than the average costs we are paying now simply because the entire system would be funded through equitable, progressive taxes – that’s on top of the sharp reductions in profound administrative waste and the efficiency of public purchasing.
As David Himmelstein explains, the bottom line is that we would have a superior system that would be affordable for each of us if we enacted and implemented a single payer system. Even Benjamin Sommers says, “The only way to get everyone insured is through a single-payer system,” and “Medicare’s enormous scale confers genuine administrative and purchasing efficiencies.” It’s nice to see that these experts appear to agree even if the question superficially seemed to bring them to opposite yes or no conclusions.
Jesus: Hey, Dad? God: Yes, Son? Jesus: Western civilization followed me home. Can I keep it? God: Certainly not! And put it down this minute--you don't know where it's been! Tom Robbins in Another Roadside Attraction
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