Medicare for…All?

So with the recent House passage of the AHCA, I want to take the opportunity to ramble for a little bit–kind of an unstructured thoughtdump of some of the issues that are surrounding this debate. I’m not an expert in health policy, which is complicated (more so than people think, apparently!), so some/most/all of this might be wildly inaccurate. But here are some thoughts, in no particular order. I’ll conclude with a hypothetical of how Medicare For All might work, although it would be necessarily simplistic.

No, Universal Health Coverage Is Not A Right

But hey, universal health care probably is. I’ve written about this before, but that time it was in the context of the practical benefits of keeping a society healthy. I still maintain that from a purely technocratic perspective, universal care would be the most attractive option (as long as you aren’t willing to kill off the sick, which I suppose is the cheapest alternative). To sum up my argument again: IF you stipulate that you won’t allow people to just die, then you have to expend some amount of money to keep them healthy. But if that’s your goal, then you should want to spend as little money as possible, which means waiting until people use emergency services is a terrible idea; how much taxpayer money is wasted because people don’t get regular doctor visits? How much taxpayer money is wasted because people miss work because of a preventable, non-life-threatening condition? Plus, waiting until the problem is an emergency is always going to be more expensive than preventative care.

So if you’re only concerned with money, you should want everyone to have health care. “But,” you say, sipping a soy cappuccino, “that’s what we have! Universal coverage is the American way! Besides, you can’t guarantee a good or service like that! Healthcare is rivalrous! If everybody has it, then nobody will have enough!”

Healthcare Isn’t A Commodity

Look, I’m not an economist. But I know about inelasticity, and I know that healthcare has inelastic demand–that is, if I’m remembering correctly, that the demand for the good is divorced from the supply. Your need to get chemotherapy has nothing to do with the availability of chemotherapy drugs; your need to get a flu shot has nothing to do with the availability of flu shots; and on and on. To say that we’d run out of X-Ray machines if everybody had access to an X-Ray machine is fallacious. It implies that there’s a bunch of discerning healthcare shoppers out there just waiting for the opportunity to get their head zapped.

Healthcare doesn’t respond to supply and demand because it isn’t a commodity, guys. You can’t transfer it. You can’t borrow it. You can sell the product of healthcare (that is to say, your labor), but you can’t choose not to get it. You get it, or you die. You can shop around to the extent there are different healthcare providers in your area, but you can’t choose a different product. You’ve got a broken arm–it’s either going to get set, or it’s not.

The rivalrous nature of healthcare is an excellent point, and one I struggle with. Let’s be clear:

There Are Great Reasons Not To Have Universal Healthcare In America

It’s expensive, for one. It’s stupendously expensive. Anyone who denies that is a lunatic (of course, those people also probably deny that we can’t tax capital gains). It would take a massive expenditure to make universal healthcare work in this country.

And healthcare is rivalrous, to an extent. I mean, it’s separate from supply and demand, but if a sick person suddenly can visit a doctor, they will; and that will necessarily be one additional person for that doctor to see. I understand, anecdotally, that we have a shortage of doctors in this country; I also know, based on Georgia news, that our hospitals, especially rural hospitals, are struggling. Additional pressure on them might be harmful.

And there are problems even within the universal healthcare framework. People in Canada have to wait longer for doctors, sure. If healthcare wasn’t as profitable, maybe we wouldn’t have as many cutting-edge technologies and drugs. Maybe there would be fewer doctors.

These are all excellent objections. But.

We’ve All Agreed That We Should Cover Everybody

Smarter people than me have pointed out that the GOP has made a tactical error in making the ACA/AHCA debate about coverage. They’re arguing that they have the ACA because it does a poor job of providing health insurance to all Americans, when their real philosophical position is that they don’t believe the government should provide healthcare. But they know that their real position is unpopular with the country, hence their current stance. But if you make this an argument about the best way to provide healthcare to everybody, the obvious conclusion to that argument is to give healthcare to everybody.

Make no mistake: this is a matter of justice. Justice is the collection of processes, principles, and systems that protect liberty and ensure fairness during power imbalances. Justice says that all men are equal, even when only some men have the guns and the money. Justice says that we are all free, even when only some men control the prisons and the factories. Justice says that our interactions will be fair, and that when a man with power oppresses a powerless man, that injustice will be corrected.

It is not an injustice when a poor man cannot buy an expensive product. But when the powerful withhold the ability of the powerless to be well, to be free, and to contribute to society as he chooses, that is an injustice.

And it will be made right.

Medicare For All–How Would It Work?

There are a lot of questions that I have about the Medicare For All proposal. Well, not really, because the MFA introduced in the House is pretty straightforward. I’m just gonna lay it all out:

If we introduced the MFA as proposed in Congress, I think the results would be disastrous. Healthcare is a huge portion or our economy, and to eliminate entire sectors at a time, in any capacity, is a bad idea. Destroying the entire health insurance industry would be a catastrophe. Not to mention the incredible damage it would do to medical providers–I’m not worried about the hospital CEOs or the millionaire doctors, but the physician’s assistants, the nurse practitioners, the young residents, all the lower folks on the totem pole. We know that Medicare pays providers less than insurance, which is one of the reasons it’s so popular. When everybody gets paid less, the response is going to be felt throughout the entire economy. We know that there is some cost-saving in single-payer plans because of administration and paperwork, and it’s true that some of those costs are now being passed on to doctors; without all that, they might see a bump, or less of a drop.

That’s why I think we shouldn’t introduce Medicare For All, but rather offer it as an option, one which would eventually take over as the de facto healthcare system in the country. First, we expand Medicare to cover everyone over age 55. That would have an immediate effect of lowering premiums in the private insurance market, because older people are more expensive, and the first way to make insurance cheaper is to remove sicker people from the pool. With the pressure from those people gone, plans can be cheaper across the board.

Then, you offer Medicare as a pubic option (the Medicare buy-in). I’m skeptical on this because I haven’t seen anyone propose an actual cost for this, but we’ll just take it on faith for right now. If you happened to, say, waive essential benefit requirements in your state, then a Medicare plan might be pretty attractive to you; and as more people started buying in Medicare, the cost to do so would go down, because the second way to make insurance cheaper is to introduce healthier people into the pool.

Here’s where things get interesting. As I see it, the more people entered into Medicare, the cheaper Medicare would be, because more people would be paying into it. But the private insurance market would also start getting more expensive and less comprehensive, because there would be fewer people to pay for it. This would create a feedback loop, with private insurance getting less attractive and Medicare getting more attractive.

Eventually, you’d reach a point where private insurance just started to wither and die, which is the same outcome as introducing Medicare For All overnight, but I believe that this way, the market would be able to absorb those shifts and adjust appropriately to those large-scale changes. As more people paid into Medicare, prices would equalize for providers; as more people got better care and their economic outcomes improved, their increased paychecks would provide additional payroll taxes to go into the system. The private insurance market would downsize, but slowly enough to absorb displaced workers.

This is an idea very similar to something called AmeriCare, which I’m going to look into in the coming days. But for now, that’s 1500 words. That’s more than enough to think about.

Categories: Get Wonky


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