May 29, 2020 | Updates

New Mexico Families Can’t Afford New State Government-Controlled Health Insurance System

A new KNG Health Consulting study examining the consequences of a proposed state government-controlled health insurance system in New Mexico finds “segments of the private insurance industry would disappear and significant additional funding sources would likely be needed to fully cover the cost of the plan,” which could lead to “higher costs for patients.” In fact, the proposal would lead to a $7 billion budget shortfall, and it could require new taxes on New Mexico families.

High costs and unaffordable tax hikes have doomed similar attempts to implement one-size-fits-all new government health insurance systems in Colorado and Vermont.  And even a far less ambitious state government-controlled health insurance system in Washington state has failed to get off the ground. 

New Government-Controlled Health Insurance Systems Would Cause American Families To Pay More To Wait Longer For Worse Care As They Are Forced Into A One-Size-Fits-All New Government Health Insurance System Controlled By Politicians:

Unaffordable Costs & Tax Hikes On American Families:

  • Under Medicare for All 71% of households with private insurance would wind up paying more than they would under the current system.” (The Wall Street Journal, 10/17/19)
  • Under Medicare for All, federal spending on health care would increase by roughly $34 trillion.” (CNN, 10/16/19)
  • One study found Medicare for All would eliminate 1.8 million American jobs. (POLITICO, 11/25/19)

Eliminating Consumer Choice & Control:

  • “Under a single-payer system that eliminated private insurance entirely … patients would not have a choice of insurer or benefits, and those standardized benefits might not meet the needs of some people. For example, certain specialty drugs or expensive new treatments, such as gene therapy, might not be covered under a single-payer system.” (Congressional Budget Office, 12/20/19)
  • Under a one-size-fits-all government health insurance system, “participants would not have a choice of insurer or health benefits compared with the options available under the current system, the benefits provided by the public plan might not address the needs of some people.” (Congressional Budget Office, 5/1/19)
  • “Less spending on medical services could also alter manufacturers’ incentive to develop new technologies or providers’ incentive to invest in capital, which could affect patients’ choices over the longer term.” (Congressional Budget Office, 12/20/19)

Reducing Patients’ Access To Quality Care:

  • Medicare for All could result in more than 1.2 million fewer doctors and nurses, leading to less access and lower quality care for patients. (FTI Consulting, 1/13/20)
  • According to the study, the reduction of physicians “would be felt most acutely in rural communities already experiencing access challenges … shortages of healthcare workers in rural areas widen existing health disparities and contribute to hospital closures,” serving 60 million Americans. (FTI Consulting, 1/13/20)

High Costs And Unaffordable Tax Hikes Have Doomed Similar Attempts To Implement One-Size-Fits-All Government Health Insurance Systems On The State Level:

  • Colorado, Massachusetts and Vermont all “failed at pursuing single-payer,” systems due to the high-cost of implementation Third Way reports.
  • States’ attempts at [new government-controlled health insurance systems] haven’t ended well,” The Wall Street Journal reports. After the unaffordable costs of a new state government option in Colorado were made clear to voters, voter opposition, which had been at 50% in January 2016, jumped to 65% by August of that year, according to Magellan Strategies polling. Voters rejected the measure by 79% to 21%.” 
  • Recent efforts to establish state government options in Washington state and Colorado proved unsuccessful after “officials were forced to scale back their ambitions because of financial concerns and industry opposition,” Dr. Joseph Antos and James C. Capretta of the American Enterprise Institute explain in The New York Times.
  • The New York Times editorial board acknowledged that “[i]n Vermont and Colorado, legislators dropped bids for a state-run single-payer system when it became clear that people would not support the tax increases needed to sustain such a program.”
  • In fact, in Colorado implementation of a single-payer system would require a budget of $36 billion a year – $10 billion larger than the entire 2017 state budget. (Colorado Health Institute, 8/1/16)
  • Vermont’s attempt to implement a single-payer system failed after analysis revealed it would have required a 151 percent increase in total state taxes. (State of Vermont, 12/30/14)
  • And in Massachusetts, analysis of the state’s total health care spending revealed implementing a single-payer system would require an increase in the state’s budget of more than 50 percent. (Third Way, 7/17/19)
  • In an interview with The Atlantic, Democratic New York Governor Andrew Cuomo was blunt about the political and fiscal realities of implementing a government-run health care system in the Empire State, saying no sane person will pass it,” and “you’d double everybody’s taxes to pay for it.


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