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The case for Medicare for All has grown stronger than ever

REUTERS/Lucas Jackson

The demand for health insurance company bailouts and recent news reports about a surge of applications for Medicaid and Minnesota Care programs — due to tens of thousands of workers losing income and jobs in the pandemic — reveal once again the chronic failures of our inefficient employer-based private health care system.

Meanwhile, the great Minnesota-centered national uprising over racial discrimination is dramatizing once again that our country suffers from shameful inequities in the care provided to people of different races, incomes, and places of residence.

In these perilous new circumstances, the case for Medicare for All (M4A) — an efficient and unified national system of health care financing that provides high-quality health services to everyone — has grown stronger than ever.

Americans overall would pay significantly less

Despite an ever-present flood of misinformation from those making huge profits from the status quo, almost all reputable research and projections about M4A indicate that Americans overall would pay significantly less than we do now under our irrational mishmash of public and private plans and programs.

That’s the finding of my recently published review of seven studies conducted by academic economists and health policy experts to estimate the cost of health care under the M4A bills currently before Congress (H.R. 1384 and S. 1129).

The conclusions of these studies are remarkably similar. The average of their estimates of health care costs under M4A is a 5.7% decrease from what we currently spend, despite more people being insured, out-of-pocket payments being eliminated, and more benefits being added.

How can this be? The answer lies in eliminating private insurance administration waste and negotiating down the cost of prescription drugs. Private insurance companies spend 13.2% of premiums on administration; the current Medicare program spends 2.3% on administration. Our drug prices, currently the highest in the world, also would be dramatically reduced. Under either M4A bill, current Medicare restrictions on negotiating with pharmaceutical companies would be abolished, leading to savings of at least 10 percent and perhaps as much as 40 percent. Over time other health care savings would also be possible.

Funds would be redirected

Overall spending under M4A would decrease even though federal spending would increase. The necessary federal revenue would be obtained not by increasing the amount of money paid for health care but instead by redirecting money now flowing through the profit-seeking private health care bureaucracy. The funds would flow instead through the federal government and then on directly to hospitals, physicians, and other health care professionals.

Gordon Mosser
Gordon Mosser
M4A would not have prevented the COVID-19 pandemic. However, as nations with universal health care have shown, preparation and response have often been more effective under a coordinated national system. Under M4A, a unified national health budget would provide for preventive care, therapeutic care, public health, medical research, and other health investments. The unified budgeting process would be a tool for assuring coordination of public health with clinical care.

The pandemic has made the perils of poor coordination starkly vivid, creating confusion about how to organize testing for the disease, how to distribute scarce equipment, and how to proceed in testing treatments. Under M4A, the federal government would be motivated to make public health activities more effective. At present, failures in public health increase health care costs primarily for private insurance companies. Except for higher costs in the Medicare and Medicaid programs, the government suffers no financial consequence for failing to prevent disease. These mismatched incentives result in underfunding of public health.

COVID-19 and the national protests over George Floyd’s brutal killing have put the costliness and inequality of U.S. health care on full view. Early in the pandemic, New York Times columnist Farhad Manjoo astutely observed that the net effect of bailouts and temporary expansion of federal public health entitlements was “Medicare for All But Just For This One Disease.’’ We know that M4A would serve us well beyond the current pandemic and the current surge of social unrest.

The preponderance of research shows that the cost of M4A is not an obstacle to its implementation. The principal obstacle has been fear of the unknown, but this fear is now more than counterbalanced by fears of the pandemic and uprising. We must seize this opportunity to build heightened public awareness of our defective system to become better informed, and to take action. We must build on the growing political will to enact universal health care and to manage the transition to it.

Gordon Mosser, M.D., is a Senior Fellow in the Division of Health Policy and Management at the University of Minnesota School of Public Health.

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Comments (12)

  1. Submitted by Paul Udstrand on 06/29/2020 - 09:58 am.

    Specially during this COVID crises the lack or outright absence of affordable insurance has been crushing people and it rarely gets reported. Although I did read a story about a guy who got a $1.8 million bill after his COVID treatment.

  2. Submitted by Clayton Haapala on 06/29/2020 - 10:35 am.

    When the pandemic has finally run its course, the phrase, “have a preexisting condition” will apply to pretty much all of us.

  3. Submitted by Bob Barnes on 06/29/2020 - 10:42 am.

    I’d suggest the opposite is true…the need for a free market is stronger than ever. It’s the only way costs come down and quality stay high or goes up. Under a truly free market system (which hasn’t existed since Medicare came along), costs would drop at least 80% immediately.

    Sure, MFA will costA little less in the short term from an end user perspective but quality will suffer greatly and numerous care options won’t be available any longer due to cost. The quality level of doctors will fall quickly a well since they won’t be able to make a nice income under MFA. In the long run you end up worse off due to no way to control costs other than rationing care.

    • Submitted by Tim McCarthy on 06/29/2020 - 11:27 am.

      Bob, your claim of an immediate 80% drop in price is more than ludicrous. It’s so outlandish that one can only view your entire comment as a poor joke

    • Submitted by Pat Terry on 06/29/2020 - 11:35 am.

      The problem is that never happens anywhere. The free market is an utter failure when it comes to healthcare. Your solution exists in conservative fantasies but not in the real world.

    • Submitted by Anne Jones on 06/30/2020 - 08:35 pm.

      The quest for a “free market” solution to the problems of cost, quality, and access in health care is a mirage, partly because health care is not a commodity, it is a human service, and mostly because the medical-industrial complex is impervious to commonly accepted market principles. Please read “An American Sickness” by Elizabeth Rosenthal who explains that our health care system is not a system at all and is a study in market failure. We are not going to fix this by making patients better “shoppers”. We have spent the last 60 years on one after another well-intentioned cost-containment schemes that have done nothing but add complexity and postpone a real solution. We spend $3.7 trillion on health care annually, with 34% of that–$1.2 trillion–squandered on the wasteful, inefficient bureaucracy needed to administer our multi-payer system. We could cut that in half, save $660 billion, cover everybody, improve benefits, and then put a big customer–the government–in charge of getting prices under control. We could also put some resources into some of the other factors that improve health–safe housing, nutrition, education, transportation, income, transportation–and also work on reducing the shameful disparities in health between whites and persons of color. Please check out information on websites for PNHP.org and http://www.healthcareforallmn.org. Anne Jones, RN, Vice-Chair, Health Care for All Minnesota

  4. Submitted by Bill Lindeke on 06/29/2020 - 10:55 am.

    I feel like the “everyone will pay much less” point is often lost in the media coverage of this.

  5. Submitted by Richard Owens on 06/29/2020 - 11:02 am.

    Bernie was right about M4A, but we just weren’t ready to give up neo-liberalism and the lure of an economy that depends on 70% private consumption. Future scarce resources cannot be allocated based on this Darwinian economic model that produces so many poor and hopeless. Trying to get rid of the ACA and leaving the W.H.O. are absolutely criminal.

    Our collective view of what a Federal government must do (because no one else CAN) has been turned into rhetorical poison with the “horrors” of “socialism”, and privatization of functions that are decidedly SOCIAL.

    Refusal to collect enough taxes from profits leaves us socializing just the risk and the debt– more for those who have no need of anything from the government or anyone else.

    We need to address the even larger problem of global collective action While the Republicans are just not able to work with others, and would rather not work with anyone who does not pay them directly.

    Seeing the future simply requires looking carefully at the present.

  6. Submitted by Paul Udstrand on 06/29/2020 - 11:28 am.

    If the SCOTUS strikes the ACA down, which I think is a distinct possibility, MFA will be the only real option left standing.

    Regardless MFA was always the simplest approach because Medicare and Medicaid are existing programs, expanding them is much easier than ACA’s attempt to preserve the existing markets. I think the MFA bill in the Senate currently stands at around 100 pages? Obviously it would be larger by the time Congress got done with the real deal but it would still be far less complicated. But don’t expect neoliberals to recognize any of this any time soon, they just can’t “envision” programs that aren’t “market” based.

    • Submitted by Anne Jones on 06/30/2020 - 08:37 pm.

      Agree completely. We need to continue to make the case that health care is not a commodity, it is a human service that should be based on need. It turns out that we could cover everyone, improve benefits, and save money with a Medicare for All/single payer health care payment system. Anne Jones RN, Vice-Chair, Health Care for All Minnesota

  7. Submitted by Richard Adair on 06/29/2020 - 12:10 pm.

    In addition to Dr Mosser’s concise economic arguments, let’s not forget that MANY people go without care in our current system. I’ve seen people die due to delaying care for financial reasons in my job as a primary care doctor in a clinic in South Minneapolis. In parts of our country mortality statistics are similar to those in the poorest countries in the world. Inexcusable.

  8. Submitted by Mark Voorhees on 06/29/2020 - 02:41 pm.

    I would have to think M4A would greatly reduce costs for the employer. They would no longer offer a health insurance plan nor would they have to pay into one. If one wanted private insurance they would go out on their own much like buying auto insurance or life insurance. M4A would simplify the entire health care system.

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