are may emerge as the number one issue in the 2020 election. In itself this isn’t surprising, given that for many decades the electorate has considered healthcare a key issue.
And, the truth is healthcare access continues to be a major problem in the U.S., along with inequalities in outcomes, relatively high prices for healthcare services, and high out-of-pocket spending. Democratic presidential candidates have weighed in on these issues.
Without more clarity, however, the debate runs the risk of unraveling into exercises in sophistry.
Politicians in America have had a knack for telling half-truths or even untruths about healthcare. For example, in 2012, John Boehner claimed that “the U.S. has the best healthcare delivery system in the world.” And, just prior to signing the Affordable Care Act (ACA) into law, President Obama stated “if you like your healthcare plan, you can keep it.”
Many constituents — myself included — are also confused by certain terms used in the current debate.
Democrats appear to all want universal coverage. Among the presidential candidates there are different ideas about how to achieve the objective. One group, led by Vermont Senator Bernie Sanders, wants a single payer system, misnamed “Medicare for All.” When Sanders and others talk about Medicare for All, they aren’t aiming to expand the currently existing Medicare program to include all U.S. residents. Rather, they’re talking about a government program that would replace all currently existing forms of insurance, both private and public. Sanders’s plan would also substitute premiums and out-of-pocket spending with taxes. Whether this single payer system would result in lower healthcare costs for individuals – paid in the form of premiums and out-of-pocket costs, or taxes – remains to be calculated.
When Sanders and others speak of eliminating private insurance and replacing it with Medicare for All they ignore the fact that private insurance is embedded in many aspects of the Medicare program. For example, more than a third of Medicare beneficiaries are enrolled in a Medicare Advantage plan, and over 60% have their prescription drug coverage managed in stand-alone fashion by a prescription drug plan. So, in addition to the abolition of commercial private insurance, Medicare for All would radically alter the Medicare program as it operates today, which makes the name of Sanders’ plan all the more curious.
There are of course some things that presumably Medicare for All would do that the currently existing Medicare program does not, including coverage of long-term care expenses, hearing, dental, vision and foot care.
A number of candidates have proposed tinkering with the existing system by expanding Medicare eligibility, i.e., Medicare for More, and still others have proposed including a “public option” to augment ACA. Regarding the former, certain groups of people — for example, those over age 50 — would be offered the opportunity to purchase Medicare. And, in the ACA-plus scenario, certain individuals could buy into existing programs, such as Medicaid, state employee health plans, or an entirely new health plan run by the state.
One area of apparent consensus across the Medicare for All, Medicare for More, and ACA-plus camps is establishing a system in which there are lower reimbursement rates for healthcare services, which would drive down costs. Currently, there is a very sizable gap between Medicare and private health insurer reimbursement rates to hospitals and physicians. Medicare for All goes furthest in ratcheting down payments to essentially a single rate. By abolishing private insurance the rates would be reduced to Medicare levels, which are at least 40% lower. This, however, could prove to be problematic as such measures could force hospitals to close if they had to accept the rates currently paid by Medicare. Physicians would also stand to lose under a drastic rate reduction.
The healthcare industry is particularly opposed to Medicare for All because of concerns about disruption to the system – even undermining insurers’ raison d’être – and much lower reimbursement rates.
A frank discussion would be welcome regarding the implications of all proposals across the political spectrum, including ramifications of undoing the ACA. For too long, the healthcare debate on both sides of the aisle has shied away from explaining the consequences of policy proposals, or inaction for that matter.