ICYMI: Experts Reaffirm Unaffordable Costs & Negative Consequences Of New Government-Controlled Health Insurance Systems

WASHINGTON – In case you missed it, experts at yesterday’s U.S. House Committee on Energy and Commerce Health Subcommittee hearing highlighted the unaffordable costs and negative consequences American families would face under proposed new government-controlled health insurance systems – like Medicare for All, Medicare buy-in and the public option.

Dr. Scott Atlas, Senior Fellow, Hoover Institution, Stanford University:

… Costs and funding of single‐payer health care are often cited as the main objection to its implementation.  And there is no question that a nationalized, single‐payer system would require massive new taxes on working Americans to fund it.  Thecurrent Senate bill to establish single‐payer health insurance in the US by Senator Bernie Sanders, “Medicare for All Act, or M4A,” has been estimated to cost over $32 trillion in its first decade.  Doubling all currently projected federal individual and corporate income tax collections would be insufficient to finance the added federal costs of the plan … The truth is that single‐payer systems … impose shockingly long waiting times for doctor appointments, diagnostic procedures, drugs and surgery that are virtually never found in the US, specifically as a means of rationing care.  And that failure to deliver timely medical care has serious consequences, including pain, suffering, and death; worse medical outcomes; permanent disability; lack of patient choices about their own health care; and tremendous costs.

… The Public Option As A Pathway To Single‐Payer … Government insurance expansions mainly erode, or “crowd out,” private insurance, rather than provide coverage to the uninsured … Premiums for private insurance will further skyrocket because of underpayment by government insurance compared with costs of services … public insurance pays less to providers – in fact, even below the costs of delivering the care – which results in even less access to medical care and even less choice of providers for patients … The public option is not a moderate or compromise proposal – it is simply a slower, more insidious pathway to single‐payer health care for nearly everyone.  The death of affordable privateinsurance is the inevitable consequence of a single‐payer option.  Indeed, even those Democrat candidates calling for “a public option” openly admitted in the presidential debates that such an option will inevitably lead to single‐payer for all.

Dr. Douglas Holtz-Eakin, President, American Action Forum:  

… [Public option] proposals appear mostly intended to serve as stepping stones to an eventual single-payer approach.  I believe both approaches are flawed.  Medicare for All would be one of the most disruptive policy undertakings in our nation’s history, both in terms of the health care system and the wider economic impacts.  Further, I do not believe the tradeoffs in terms of access and quality of care, inherent in such a transition, have been adequately considered.  Finally, the costs of financing such a system would be substantial, and the incentives could well exacerbate rising health care costs.  As for those proposals short of Medicare for All, they typically would spend a great deal of money to achieve minimal increases in coverage because they are not targeting the portion of the population that lacks coverage options.

… Medicare for All would be incredibly disruptive … [I]t would be extremely complicated to implement a one-size fits all approach, and such an approach would almost certainly have. unforeseen ripple effects.  Second, coverage expansion under a Medicare for All system would come with tradeoffs.  You will invariably sacrifice some quality and some access in exchange for government control and universal coverage … [U]nder a scenario where the government paid Medicare rates for all patients, hospitals would make fewer investments in quality … There will be trade-offs around quality of care and access to care of varying degrees, depending on the specifics of the proposal.  Further,expansion of coverage will only exacerbate demands on the system, impacting access to care more. 

… [T]he cost of a Medicare for All, single-payer system would be high.  Assuming rates close to Medicare reimbursement, the Urban Institute has estimated that the Medicare for All legislation from Senator Bernie Sanders would cost roughly $32 trillion.  AAF’s Centerfor Health and Economy modeled the Sanders proposal in 2016 and showed a ten-year cost between $34.67 trillion and $47.55 trillion, depending on the generosity of the plan’sbenefits … Financing such a program would require substantial tax increases. In fact, recently published research by the Heritage Foundation found that funding Medicare for All at a cost of $2.387 trillion in 2020 “would require additional payroll taxes equal to 21.2 percent of all wage and salary income.”  That rate is in addition to currenttaxes.  They further determined that most American households would pay more in new taxes than they would save by no longer paying for their health care.  According to theresearch, 65.5 percent of all households and 73.5 percent of the total population would pay more in taxes than they otherwise would have spent on health care services, making them worse off financially under a Medicare for All system.  

To learn more about unaffordable costs and negative consequences government-controlled health insurance systems, CLICK HERE. 

To read the Partnership’s letter to the U.S. House Energy and Commerce Health Subcommittee, CLICK HERE. 

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