April 26, 2019

What are the Real Issues in Medicare for All?

Guest Column
By Tom Gutowski | March 16, 2019

In a general sense, Medicare For All, or MFA, isn’t a radically new concept. Every highly developed country has universal health insurance, except us. Some of those insurance systems — not all — are single payer. What’s radical is that America, the richest country on earth, doesn’t havesomeform of universal coverage.
 
Potential government intrusion into our choice of doctors or our medical decisions isn’t the threat it might seem; current Medicare recipients actually have a broader selection of healthcare providers than they did when dealing with private insurers’ networks. Medicare does sometimes deny coverage, but that happens in private insurance as well. At least in a government-run program, the profit motive doesn’t get in the way of fair decision-making, and coverage issues can be addressed through the political process.
 
And the total projected cost doesn’t make MFA a radical idea either. Savings could come from more efficient administration, from allowing Medicare to negotiate drug prices, and from more people getting care on a timely basis, rather than waiting until urgent or emergency care necessitates it. Plus there are savings that come from having a healthier population: higher productivity, fewer bankruptcies, healthier military recruits, and less utilization of various social safety-net programs.

And decoupling health insurance from employment could boost the economy by sparking an increase in entrepreneurship. Additional savings also could come from cutting Medicare payments to providers, but that might be unwise if we want to avoid discouraging people from practicing medicine.
 
The real cost-related issue is how each of us would be directly affected. Under any version of MFA, taxes would go up while premiums for private health insurance would go down, possibly to zero, depending on what form of MFA was enacted. Premiums might also fall for other forms of insurance — such as auto — if they no longer needed to cover medical. (What a boon that would be for Michigan.) And out-of-pocket costs would presumably drop, as well. Exactly how that would add up for any particular person or family remains to be determined. Half of Americans get their health insurance through their employers, and most like it. If we’re asking them to embrace change, they’ll need reasonable assurances that they won’t be worse off.
 
Wait times are another concern. Overall, wait times have been growing due to a physician shortage and an aging population. For some people, though, wait times are infinite; they never get the care they need, because they can’t afford it. Getting these people insured — no matter how that’s accomplished — will increase the demand for care, and probably further increase wait times. Of course, that’s no reason to deny them care. Besides, this issue can be addressed through things like increased use of telemedicine and of physician assistants, and by pursuing policies designed to increase the number of practicing physicians.
 
Then there’s the insurance industry itself. Billions of dollars disappear into the pockets of health insurers every year, and per capita spending would be less if this weren’t true. But eliminating private insurers would be hugely difficult. There are a half-million people employed in the private health insurance industry. Some could end up working for Medicare, but what about the rest? The industry can reinvent itself, but not overnight.
 
We need bold visions of the future, but we also need concrete ideas about how we get there in practical, measured steps. Two obvious examples of how we could ease the transition to MFA: Phase it in by age bracket and give people options: to continue using private health insurance or to buy in to Medicare. Long term, it might also make sense to keep supplemental insurance as part of the mix and to use modest co-pays to prevent overutilization.
 
Finally, some folks just don’t like the idea of their tax money going to pay for someone else’s healthcare. If you’ve worked hard and been responsible, you don’t want to pay for someone who hasn’t been. But here’s the thing: You don’t have to be irresponsible to be overwhelmed by medical bills. Millions of hardworking Americans are one serious illness or injury away from losing everything, either because they can’t afford to buy health insurance and also pay the rent, or because the insurance they do have proves inadequate. Besides, we’re already paying for those who can’t pay their own medical bills, and some of the ways we do that aren’t very cost-effective. It would be cheaper, as well as more humane, to ensure that everyone gets quality healthcare up front.
 
Any system of universal coverage could enforce personal responsibility by requiring everyone to participate. That should alleviate some of the concerns about fairness. Under true Medicare For All, everyone would participate by being subject to the same tax code; who pays what under the tax code is a separate discussion. In the ACA, the original intention was to enforce participation through the individual mandate. (The penalty for non-compliance has since been reduced to zero.) Either way, the idea is to get everyone into the system. And that, ultimately, is how it should be.
 
Tom Gutowski is retired from the insurance industry and lives in Leelanau County. A good read on the healthcare systems of other developed nations is “The Healing of America” by T.R. Reid.

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