By Joe Flower
Will this great red, white and blue country of ours ever find a way to do what every other advanced economy in the world manages to do, that is, make sure that everyone’s medical needs are taken care of? Since the midterm elections in November 2018, everyone is talking about it again, for three reasons:
Myth #1: Universal healthcare, “Medicare For All,” “single payer,” they’re all the same.
Not! Let’s start with “universal.” It means only that: Everybody’s healthcare needs are taken care of, one way or another. But there are lots of ways to do that. It isn’t just one thing.
Medicare for All is just one way to do universal coverage. Medicare is a “single payer,” the government, paying private providers for our medical care.
And even “Medicare For All?” isn’t just one thing. The new Democratic House has before it eight different plans for expanding coverage, including 3 different Medicare-For-All plans.
Then we come to “single payer.” Again, it means only that: One payer for any of these plans that we, as a country, might choose. When we hear that someone picked up the tab at dinner, that doesn’t tell us anything about where the folks ate, what they ate, and how the meals were prepared. Single payer doesn’t indicate anything about the type of healthcare we’ll get, and it certainly doesn’t, by itself, tackle the cost problem.
Myth #2: Universal healthcare has to cost way more.
People assume that the amount paid in taxes for healthcare will inevitably be greater than the amount people and their employers pay in healthcare premiums now.
It could cost more, but it doesn’t have to. Every other advanced country has universal healthcare, and they all cost about half what we do.
Now, it’s true that if we simply covered everyone for everything all the time, without changing anything else about our system now, then yes, it would cost way more. But there are huge opportunities to drive the costs of healthcare down. If the same universal health plan also took those opportunities, then no, universal healthcare does not have to cost more.
Myth #3: Controlling costs of a universal system will have to mean rationing.
No. That would seem to make sense—if you’re spreading some commodity around to more people, you’re going to have to limit how much they all get, or it will cost way more, right? But not in healthcare, simply because there is already so much waste, and so much being done that does not need to be done, so much done in the most inefficient, expensive way possible, that the way we do it now costs at least twice as much as it needs to. We can mine that waste and redirect those resources to help people who are not getting help now without rationing anything.
Myth #4: Universal healthcare will cost way less.
Bless our little American hearts, but: A lot of the people against universal healthcare just think the government screws everything up, everything is a $3000 coffee cup, everything is a billion-dollar overrun, so of course it’s going to cost more, way more. And a lot of the people for universal healthcare believe the exact opposite: Put the government in charge, and we won’t have to put up with all this stupid over-pricing and ridiculous costs, the government can just dictate all that, so of course it will cost way less. Every plan being considered by the new Democratic House claims that the government will control costs, but it’s not clear how they propose to do that: What’s the mechanism? How’s that going to work?
If it doesn’t have some radically new way of paying for healthcare, we don’t have to speculate what Medicare-For-All would look like, because we already have Medicare-For-Some, it’s just limited to people over 65 and people with certain medical disabilities. It does attempt to control costs. Does it actually cost less? Only somewhat less, per person. It’s only somewhat more efficient, not massively so. The folks at Medicare do good work most of the time. But Medicare is still massively prone to funding overuse, waste, and higher than necessary prices.
Why? Here is the core truth, the most important thing to know that is usually missing from analyses and reports to the general public but which is common knowledge inside US healthcare.
So pay attention: What makes us way more expensive than everyone else on the planet really doesn’t have to do with whether we are covering everyone. I know that’s surprising, but it’s true. What makes us way more expensive than everyone else is how we pay for healthcare. We don’t pay for results. Instead, we just pay for the healthcare system to do stuff to us. We pay fees for services.
Think about it. We pay for a lab test, a doctor’s visit, a drug, surgery, not to fix us, or to keep us healthy. When you pay people do stuff to you instead of paying them to make you healthy, what do you think happens? The system tends do as much stuff as possible, to do it the most expensive way possible, and to charge as much as it can get away with. It’s normal. It’s how systems work.
Now, in this system there are plenty of folks in the healthcare system who are trying to do good work and make people healthy. But they are trapped in a fee-for-service system that only pays them for doing more stuff faster, and penalizes them financially and career-wise for doing what would truly be best for you, the patient, often at much lower cost.
So this situation creates a lot of waste, overtreatment, and insanely high prices in every single part of healthcare. Obvious when you think about it, right?
If we changed all that, if in a number of different ways we paid for results instead of stuff, we could easily take care of everyone for half or less of what healthcare costs us now. We could all get what we really need and want at a cost we can all live with. If we don’t change what we pay for, it won’t be cheaper than what we have now.
If we changed how we pay for things in the same universal healthcare plan, if we stopped paying for waste and overtreatment, stopped paying high prices that have no real basis, and stopped dealing with chronic disease in the most expensive way possible, then universal healthcare would not have to cost more, it could cost way less.
Myth #5: Universal healthcare means “government-run healthcare,” it means “socialism”.
Nope. Medicare, for instance, doesn’t own any hospitals or clinics. It doesn’t employ any doctors or nurses. That’s what “socialism” would mean: Nationalized, state-run bureaucracies. Medicaid, our sort-of universal system for the poor, doesn’t employ docs and nurses either. The services are almost all delivered by private systems.
Around the world we see a wide variety of ways to provide healthcare to everyone. For instance, Canada, Denmark, Norway, and Sweden have “single payer” systems, like our Medicare. Their governments pay for care that’s delivered privately. Great Britain and Spain, on the other hand, have national health services. The government pays the doctors and owns the hospitals. Germany and France have multiple payers. They have private insurance companies, and public ones for the poor and disabled, all tightly regulated and paid out of various funds. But one way or another everyone is covered.
There are lots of ways to do it.
Myth #6: Universal healthcare means turning over our lives to a massive bureaucracy.
Wait, what? As opposed to now? Have you ever tried to get a health plan to pay a bill that they have rejected? It’s worse than one massive bureaucracy, it’s multiple massive competing bureaucracies. The hospitals have huge staffs to try to get paid by the health plans, the health plans have massive bureaucracies that try to not pay a dime more than can be ripped out of their clutches, states have bureaucracies regulating hospitals and insurance plans, the feds have multiple bureaucracies.
Here’s a key point in this debate: Medicare, the largest government healthcare program, spends far less per person on bureaucracy than the private health plans—and the amount Medicare spends per person has been going down since 2005.
There are all kinds of ways of providing universal healthcare. Done right, it could actually mean less bureaucracy, not more.
Myth #7: Universal healthcare would mean abandoning today’s “free market” healthcare.
Um, no. Today’s market is not free, it’s highly regulated. It’s a constricted market in which the ultimate customer, you, have no power. It’s not really a private system or a government system. It’s a private system that is constrained by government under all kinds of legal and licensing requirements which have been haphazardly built up by the healthcare industry itself over the last century, not only to protect the patient, but also to protect its own rights and privileges. And now they are in such a tangle that hospitals have whole huge compliance departments dedicated to making sure that they follow all the regulations The people who run those departments will tell you that it’s ultimately impossible, since the regulations and the definitions from all these different directions contradict one another.
No, we don’t have a “free market” in healthcare today.
Myth #8: A universal system cannot work, it cannot sustain itself if people who are not working (and therefore not paying taxes) are able to use it.
Of course it can. That’s what a universal system is for, to make sure people can get help whether they are in a position right now to pay into it or not. It spreads the cost across generations, across rich and poor parts of the country. This is what Medicare, Medicaid, Federally Qualified Community Clinics, CHIP funds for children’s healthcare, and other such programs are for, to help people who are not working, retired, or otherwise too low-income to be paying into the system.
Myth #9: Immigrants inevitably draw more out of a universal healthcare system than they pay into it.
This is provably false. There have been multiple studies, looking at the question in different ways. Even recent immigrants are desperate to make a living, build a business, provide for their families. They want to be taxpayers as soon as possible, and most of them succeed. It’s a very American story. And the studies show that not only do they pay into the tax system and Social Security system, they pay more than their share because they actually tend to use Medicaid and Medicare less than other Americans.
Myth #10: Research and innovation are what make U.S. healthcare expensive. If we reduce the amount we pay for healthcare, we will get less research and innovation.
No, research and innovation are not what make U.S. healthcare expensive. There are no data supporting this notion. The claim of pharmaceutical companies that it costs them all these billions to develop new drugs is a simple assertion that they have not backed up with facts. Moreover, research and innovation does not need to be funded only by higher and higher costs for patient care. There are many other ways, such as direct government grants, private funding for startup companies, pharmaceutical companies and device manufacturers funding their own research.
And if you think about it, you’ll see that much research and innovation could actually be used to lower the cost of healthcare rather than raise it, the way CT scans and MRIs have taken the place of a great deal of exploratory surgery, and laparoscopic surgery gets you out of the hospital faster. Research into emerging areas of medicine such a functional medicine can treat chronic diseases at a much earlier and more manageable stage. The right kinds of research and innovation can actually lower costs.
So what does cause high prices? A fee-for-service payment system that encourages and even demands
Will this Congress bring us universal healthcare?
No, not this Congress, since it’s still a partisan issue (though there is no need for it to be) and we still have a Republican Senate.
What can happen, and will happen, is that by considering and debating the possibilities, and possibly actually passing a bill, the Democrats in the House will manage to re-open the discussion, and re-focus the political discussion to, “How can we do this? What would actually provide healthcare to more Americans, maybe all Americans? What would actually lower costs? What would actually widen the definition of what is covered to emerging new modes of medicine that are lower cost and more helpful at the same time? Can we do this?”
That’s the good news of the present moment: We can actually have the discussion that has been denied us for most of the last decade: What would work?
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