The Perspective on Single-Payer Health Care

*Updated 2019

Since the 2016 US presidential election, single-payer health care has moved from a fringe position into the mainstream. A single-payer plan, sometimes summarized as “Medicare for all,” entails the government providing every citizen with health insurance, which is paid for through taxes. During the 2018 midterm elections, health care became a central issue. While existing US policy sees the government providing health care to the elderly and the poor, with a patchwork of subsidies and tax benefits helping to cover the remaining citizens, recent pushes by the current administration to upend this policy raises question about the future of health care.

Can single-payer health care work in the United States, or would it cost too much while limiting consumer choice? We take a look at three arguments for each side of the debate.

 

Pro Single-Payer

 

It will help the middle class and entrepreneurs

While everyone stands to benefit from a more efficient health care system, the groups that may gain the most are the middle class and small business owners and workers. The current system provides government-sponsored health care for the poor and elderly through Medicare and Medicaid. Meanwhile, most workers in large corporations receive health care as part of their compensation as required under Obamacare. The people left behind are those between jobs, those working for small businesses and those looking to start or grow their own small business.

Government-provided health care would make it easier for entrepreneurs to leave their jobs and start their own businesses, since they would not be putting their families’ health care at risk. It would make it easier to hire workers early on, since employees would be more willing to take a risk working at a new firm knowing that health care is provided. And if the business takes off, it would no longer face the threat of the employer mandate once it crosses a certain threshold, which Obamacare set at 50 workers.

 

It will save money

Americans are paying more than other developed countries for their health care. Let’s look at Canada, France, Sweden and Switzerland, for example. These are all countries that have a similar GDP per capita to the US but offer single-payer health care systems. According to OECD data, these countries spent between 10 and 12 percent of their GDP on health care costs compared to a whopping 17 percent of the America’s GDP. There are several reasons for this. Cutting the massive administrative costs associated with private health care, for example, would reduce overall health care spending by around 15 percent, according to one study.

 

It will produce better results

Compared to other countries, Americans are paying the most for their health care, yet their investment is not paying off. Study after study shows that Americans achieve worse health results than their peers in the developing world. A report published in the summer of 2017 compared the US with 11 similar countries and found that it fared the worst of the bunch. On access to care, equity and health care outcomes, the US ranked last, while only France was worse in administrative efficiency.

At 77.9 years, US life expectance is towards the bottom of the OECD, behind poorer countries such as Chile. Nearly every developed country has achieved some form of universal health care. In the OECD, only the US and Mexico, one of the group’s poorest nations, fall short. From Israel to Australia to the UK, wealthy nations outside the US have embraced the single-payer system and have seen better results. Not to mention that Obamacare also guarantees coverage for people with pre-existing medical conditions.

 

Single-Payer Is Not Feasible

 

It means long wait times, worse care

Sure, it may be nice to envision single-payer health care as a means to ensure that care is available to everyone. The problem, as Canadians can attest, is that, in practice, it can mean that while more citizens are covered, their standard of care is lower. Under the Canadian system, a typical patient can expect to wait 20 weeks after seeing a doctor to begin treatment with a specialist. As imperfect as the US health system is, American patients rarely see wait times approaching this length. Too often, these delays can mean the difference between life and death. Perhaps that is why many Canadians end up crossing the border for US medical treatment. In many ways, the quality of health care in the US surpasses that of Canada and Western Europe.

 

The private market drives innovation

America’s profit-driven health care market has its flaws, but it has also contributed to making the US the most innovative country in the world in the field of medicine. In the last 10 years, nearly half of the winners of the Nobel Prize in Physiology or Medicine have hailed from the US, a far higher rate than any other country. This trend dates back decades. Nobel Prizes are just one way to measure. In 2009, 40 percent of articles published in biomedical journals came from the US, three times as many as its nearest competitor. And more than 40 percent of new drugs are developed in America. Were the US to abandon its private sector model, the country and the wider world would lose out on this innovation.

 

It is unaffordable

Americans may be willing to spend a little more money for the security of knowing they would receive quality health care. According to some estimates, the costs of enacting a single-payer system, though, would not just be high. They would be astronomical. Examining a past proposal by Senator Bernie Sanders, the non-partisan Urban Institute found that it would increase spending by $32 trillion over 10 years. The Committee for a Responsible Federal Budget pegged the number even higher. According to the Washington Post, such a spending hike would require “a tax increase so huge that even the democratic socialist Mr. Sanders did not propose anything close to it.” The only way to square his proposal, as New York Times columnist Paul Krugman noted, was with a “huge magic asterisk.”

The Bottom Line: Single-payer health care in the US would require an increase in government spending but would allow for wider coverage across the population. Would the quality of care decrease, and if so, is that a worthwhile trade-off to ensure everyone is covered? What do you think?

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