We’ve had quite a few MFA threads over the past couple of years, but I couldn’t find a basic answer to this question.
Currently we’re seeing something like $30-$50 trillion over what? 10 years? 20 years? Either way the numbers are outrageous. But what I can’t figure out is how those numbers are calculated. Presumably we’d see an increase in overall medical visits and procedures, but assuming that they’re necessary, that would be a good thing, no? On the other side we’ve removed the necessary profits of the insurance industry and potentially added the ability to negotiate rates with all providers. So what’s the cause of the huge increases?
Note that the numbers quoted are for increase of federal budget to pay for it. That does not mean it will cost the nation that much additional to provide all medical care.
And lastly, if we could just get everyone to stop running with scissors, emergency healthcare costs would go down.
Mostly, they are made-up numbers to scare people into opposing Medicare For All.
Of course, proponents have their own made-up low numbers to support the proposals.)
Most of the made-up parts of these numbers depend on what assumptions are being made about the program and how it is run. Seems like the most realistic numbers would come from comparing the cost of similar programs in other countries, like Canada or Europe. (Personally, I think the numbers used by proponents are closer to reality. But we’d have o go to the GD forum to discuss that.)
Just take what Canada spend and multiply by about 10. Google tells me:
So $2.2 trillion a year. Not including pharmacare except for poor people. Plus imagine a bump in the early years as people catch up on the chronic conditions they’ve put up with because they had no money.
USA Medicare and health spending is already about $985 trillion. (and what are you getting for it?) So a little more than double the current spending.
A warning - if you went with the Canadian system - all doctors would be required to be all out or all in. In Canada, there is no private health care, so except for a few extreme boutique medical facilities (i.e. doctor for a sports team) every doctor is in the system and can only charge the schedule price. there aren’t really private services because anyone who can afford private health car out of pocket here just goes south to the USA. Hospitals are effectively run by civil servants with budgets dictated by their province, so no more hospital CEO’s with multi-million salaries. Health insurance companies would be relegated to the dregs of the business - in Canada, that’s pharmacy, eyecare, and some assorted medical devices not fully covred by UHC.
Canada has specifically excluded the British equivalent of a parallel private health system. “You want to see the specialist? There’s an opening in 6 months. Oh, you have private insurance and can pay more? We can get you in next week.”
I imagine the screaming as whole sectors of the healthcare economy see the gravy train drying up…
That was informative, thanks. Forgetting for a moment how funds would be transferred from the current system to a government-run system, is there any reliable per-person comparison of MFA vs the status quo?
MD2000 has mostly got it correct, but I want to add a couple points. First add dentistry to the uncovered care. Now if you want to pay, you go to a private clinic. There is private insurance but only for uncovered things (like dentistry). I needed a prostate biopsy. Either wait till the public hospital can do it or go to a private clinic. It was only a couple hundred so I chose the latter. But get this. When it was done, they gave me the sample with instructions to walk it up to the public hospital two blocks away and give it to their lab for diagnosis (it was negative and I decided against any more PSA testing). So the lab didn’t even examine the specimen.
Yes, the provincial health ministries decide how much each hospital gets and the hospitals set their own priorities. When I broke my ankle 14 years ago, I hobbled over to the nearest hospital which did and X-ray to diagnose the break (I thought is was sprained) and told me they didn’t do orthopedics and sent to the hospital that did. I have to say that a large part of the exaggerated cost of US care is in the hospitals. When I was growing up, I never heard of a for-profit hospital. They were all either religiously affiliated, municipal, or connected with one of the five medical schools in Philly. Rooms were spartan and meals were awful. I was born in a hospital called Presbyterian, which is now part of the Penn medical college. When I had my appendix out in 1950, Jefferson hospital (part of the medical school) charged $8. per night! Imagine that. Now most hospitals are proprietary and have become outrageously expensive. I remember seeing the final bill when my MIL died in Florida. One thing that struck me was a $5 charge for an aspirin. And that was in 1988, 31 years ago. Probably $50 today.
So while the insurance companies bear a lot of responsibility for the excessive costs, they are not the only culprit. It is the excess profits built in to the entire system.
I have no real idea of what you are talking about, but 985 trillion is quite a lot to spend on medical care. Especially given the the US GNP is around 20 trillion.
Perhaps you are talking about over the next 100 years?
Doh! I originally put 1 trillion then meant to correct it to more precisely 985 billion.
I suspect the crazy numbers thrown around in debates are a combination of scare tactics and taking the extreme numbers for American medical costs, without considering the stranglehold on setting rates a single provider has. Keep in mind one of the common complaints of Canadian medical workers is how low their pay is compared to the USA. When someone in the USA gets a surprise bill for an out-of-plan anesthetist for $8,000 for a routine operation - you bet your ass no anesthetist in Canada makes $8000 for a days work.
Simple calcs - there are about 250 working days in a year. If a specialist doctor makes $1000 each day how much does he take home? Even if you up that to $2000, he’s still able to afford a Porsche and those carbon-fibre golf clubs. But in Canada, there’s a lot less malpractice (and lawsuits in general) since much of legal awards in the USA are to cover medical costs, which in Canada are… wait for it… not charged to he plaintiff; plus if you sue a hospital, you are suing the government so less of that “the rich bastards can afford it” sympathy. So Canadian doctors pay far less in malpractice insurance.
My nephew (American doctor) mentioned that he compared notes with similar specialists in Canada and they made about the same amount. OTOH, all the doctors specializing in breast cancer (5 of them?) in Newfoundland quit once a while ago in protest of how low the fee schedule was. Newfoundland would rather fly patients to Halifax than give in to their demands for higher fees.
(Side note- provinces do fly people from remote communities for higher level medical care not available in their communities, and travel is paid for by healthcare. They also pay some travel expenses for rural communities. I bet not too many health care plans in the USA include travel?)
It’s also misleading even where accurate, to point to the increase in government spending without acknowledging the huge falloff in necessary expenditures on the part of employers and individuals who currently pay for health insurance.
It should be cheaper overall to cut out the insurance companies (which by definition seek to make a profit; they seek to take in more than they pay out) and simply operate a bureaucracy that reimburses medical providers.
That bureaucracy would be paid for via taxes. The private individuals and the corporations that provide health insurance for their employees, and the private individuals who pay co-payments and/or pay for medical services not covered by their insurance would no longer be making those non-tax payments and would instead be shelling out more in taxes.
The taxes will be expensive, but the existing medical insurance and copayments and above-&-beyond medical costs are exorbitantly expensive now. Can we afford it? Shit, we can’t afford not to.
It’s not just screaming. Every hospital and clinic in the entire USA is optimized for the current setup. You’re talking about going from 3.5 trillion a year (2017 numbers) to 2.2 trillion a year.
I agree it is possible to provide the same or superior overall medical care for 1.3 trillion less dollars, but the transition needs to be done carefully because interruptions in service can and will kill people.
Most of those numbers are highly misleading, but still true.
America spends about 3.6 trillion a year on health care. That number keeps going up.
So over the course of a decade, we will spend about $40-50 trillion on health care.
If we enact medicare for all, that number will drop down to maybe 30-35 trillion. A savings of 5-15 trillion over doing nothing.
However if we have medicare for all, does that mean we need an additional 35 trillion in taxes? Nope, because currently around 50-70% of all medical bills are already paid for by the public sector.
So in a medicare for all system, you roll that 70% of funding into the medicare for all system. Now you just need new taxes to pay the remainder.
Taxes will go up under medicare for all. Funding mechanisms are usually a mix of payroll taxes split between employer and employee combined with progressive taxes on income and investments.
But overall spending will go down. So maybe a 8% tax that is 5% on employer and 3% on employee combined with some progressive income taxes will pay for medicare for all.
FWIW, when Vermont looked into single payer, they found their health care spending would be 25% lower after a decade compared to baseline.
Meaning, lets say after a decade their normal medical spending would be $15000 per capita. Under medicare for all it would only be $11400 or so.
TL;DR - doing nothing and keeping our current system means we will spend about 40-50 trillion on health care over the next decade. Enacting medicare for all means we will spend closer to 35 trillion since medicare is cheaper than private insurance (it has lower reimbursement rates, better negotiation powers and lower administration costs). Since over half of health care is already funded via taxes, we’d only need to replace about a trillion dollars a year in private spending with new tax revenue. However we’d save well over a trillion dollars in private spending. So we’d save money overall.
Yes, taxing corps what they now pay for employee health care will help a lot.
It should be cheaper, it likely wont be, but still, most families wont pay significantly more than they do now.
Do remember that real Medicare for All plans (Sanders plan isnt MFA in any way shape or form) will include some premiums just like medicare does now- parts B, C, & D.
The extra taxes will not be onerous and after a bit the savings from NOT have the uninsured go to the County ER for normal health care will help.
It’s because it is a single and relatively small state that it doesn’t work. You need the benefits of scale that come from a large market.
I’m just baffled by the argument that UHC is too expensive to work in the US. The US is the single richest nation in the world. However, saying more than that is not appropriate for GQ.
Another factor over time will be simplicity. There is the hospital or doctors office bureaucracy for dealing with dozens of insurance provides (and bill collectors), there’s arguing about what’s covered or not in assorted plans, arguing whether the bill is too high, seeking approvals for treatments, etc. With a single plan, with a comprehensive list of what’s covered, with a single form, with no arguments about billing, etc. - not to mention insurance company profits, and the concomitant bureaucracy on the insurance company side to attempt to deny or defer costs. If anything, the accounting mess in hospitals is even worse. In UHC there is no anal need to document and track every aspirin and bandage. If all this disappears, life will be easier and simpler for hospitals, doctors, patients and the payment system -and much cheaper!
Medicare For All as actually proposed in Senate legislation by Bernie Sanders would be more costly. It covers things that are not included in all Canadian provinces. Although some candidates use Medicare for All as a vague stand in for a UHC system that roughly resemble other nations, Sanders is the one who coined the term in the 2016 election. He submitted a bill for it in 2017 and an updated one earlier this year. It’s hard to cost something without that level of specificity.
From an article on Vox looking at the 2017 version of the bill:
Ambulance services are in the 2019 version. That’s another area, IIRC, where not all Canadian provinces provide coverage.
We should avoid assuming the government costs have an analogue when the system proposed has no analogue. Assuming away things for now like different cultural approaches to seeking care and different ages distributions we should generally expect Sanders’ proposal to be more expensive per person than any other currently existing system. It covers more and charges less in copays. The hard part is figuring out how much more expensive.
The comments in the Vox article about Bernie’s plan covering more than the Canadian Medicare plan are accurate (although the federal Liberals are sorta kinda campaigning in including pharmacare if elected.)
The comment that other countries have charges for patients is not accurate for Canada. Any sort of “co-pay” (used to be called “extra billing” here) is banned under the Canada Health Act. We pay for our health care through income tax.
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Hard to compare to all so it’s a good point. I’d also say it’s more of an aside to the major point about costs. Compared to what Sanders has proposed other countries employ some mix of measures to keep the government cost down. Some use far more co-pays than MFA. Some limit what the program covers. Some use both.
Medicare for All mostly tosses those typical government cost savings measures in the bin. The price tag probably should be a little shocking as a result.
The provinces run the health care systems in Canada paid for with their income taxes. (with a few exceptions). The federal government provides equalization payments to the more “have-not” provinces, plus a large proportion of the costs with lump sum from federal taxes intended for health care. The feds use this as a carrot and stick to enforce the standards of the Canada Health Act, which among other things sets the principle that there can be no “extra billing” over and above what the health care system pays, and no cop-pays (I think). So part of the money comes from provincial income tax, part from federal, but the day to day administration of health services is provincial.
So presumably, US UHC would be similar - like Obamacare. The feds would offer the states money to run their own systems, but set standards they would have to meet to get the big grants from the feds. Kinda like the interstates, only good for people.
