Why ‘Medicare for All’ is a Really Risky Agenda

Medicare, a universal healthcare plan has been a proven form of the single-payer medical system, and Democrats have been advocating to expand it to Americans younger than 65. Bernie Sanders’ and other Democrat front runners of the 2020 presidential race largely focus their campaigns on Medicare expansion. The main argument of their agendas is that it is the right function of government to provide medical care or ensure that medical care available to all citizens at a certain degree. The government would decide on prices for services, treatments and medical equipment.

Annually, a national budget would be set for all covered services and spending, limited by the cap. Proponents of ‘Medicare for All’ demand a guaranteed basic, accessible, free system. Every first-world developed country has some form of cost-effective universal medical plan. The USA spends $3,5 trillion per capita, which is the most in developed countries. Canada and the UK (NHS) are the closest countries to true single-payer coverage: their governments cover medical bills with funds raised through taxpayers and have monopolistic power over the prices. 

It is estimated that more than 45,000 Americans die prematurely every year because of no access to health insurance. The total annual healthcare cost in America is about $3.2 trillion, and it is the main concern among the voters. 

According to the national polls, Republicans — who control all branches of the federal government — are strongly opposing single-payer, whereas single-state efforts in California, Colorado and New York have been ineffective (Kaiser Health News, 2018). The single payer plan is now supported by over 100 US Congress members (Modbee, 2018).

More than half of people polled favor the idea of a universal health plan, but when it comes to the details, things get more complicated. It is clear that supporters are not happy with the current healthcare, but the question is what are the implications and ripple effects of introducing ‘Medicare for All’? 

‘Medicare for All’ has significant implications for raised taxes, bringing deadweight losses. Deadweight losses are the main argument it is a bad idea simply because of their size. Such losses are usually shown as a fraction of revenue raised. Estimated costs for this plan would be $32 trillion in federal spending over 10 years (The Urban Institute, 2018). Opponents argue that these costs are not affordable. Proponents argue that these federal costs are estimated without deducting existing public and private spending. Thus, it creates an inaccurate picture of its affordability. Even though Americans would save on out-of-pocket costs, the government would have to put the burden on taxpayers and increase taxes. Such a massive shift in the healthcare market would mean implementing tax code changes. Only 37% would support ‘Medicare for All’ if it meant raising taxes.

Another issue lies in variations of meanings under the idea of ‘Medicare for all’. Its simplicity can be misleading. Enacting single-payer legislation nationally or in the states is a significant step, therefore advocates of “Medicare for all” should make it clear not to take the phrase too literally. Its ambiguity makes it confusing for interested parties.

Long waiting lists are one of the risks associated with single-payer healthcare. For example, the National Health System in the UK has its pitfalls too. Most of the patients complain about the long waits, stretching to hours. NHS hospital directors reported the inability to deliver comprehensive care due to the overcrowded and understaffed facilities (Heritage, 2018). An attempt to squeeze in more beds in a hospital room and serve more patients in an hour would likely to result in decreased quality of care and stress for hospital workers.

The idea of eliminating private insurance does not seem perfect either. In the US, the country of capitalism, free market, and competition, Sander’s proposals sound far more damaging and disruptive than we assume. The plan would mean that Americans would have to enroll in a new government system and step off of their current healthcare plans. This would result in less choice in making decisions about their healthcare plan. Nationwide, the 156 million people getting coverage through employers have to give it up (Real Clear Politics 2019). If everyone has access to the same healthcare plan, it decreases an incentive to work for a company that provides a better option. Unsurprisingly, many unions protest the campaign.

As one of the suggestions, innovative healthcare solutions could be experimented on a state-level, before reaching out nationwide, as many citizens will be likely to lose their jobs in private insurance. 

The Bottom Line

The idea of ‘Medicare For All’ sounds promising in a retrospective of the current healthcare system, however as it has become the main point of campaigns by Democratic Party. In the absence of a feasible single-payer plan to support, Democrats promoted the agenda of single-payer system government insurance is provided nationwide— without having to commit to underlying trade-offs. It is virtually impossible to cut the costs without cutting quality. 

If single-payer health care is implemented in the US, it could potentially mean the decreased quality of care, burden and unsustainable spending, and loss of jobs in the private insurance industry. Ambiguity and surface simplicity of the plan raises a lot of questions about its potential risks and implications. At least in America, when your insurance company denies you costly procedures, you have the choice to go for another insurer. In the UK, you have to rely on whatever the government is willing to pay for, even if it costs you your health.

Finally, single-payer advocates should focus less on alleged simplicity of it, and more on health care as a right that Americans should enjoy universally and equally. In theory, it could totally work, but in practice, it probably will not. The “one-size fits all” approach has major risks when it comes to millions of citizens and their health.

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