11.8.19 / Updates

THE WEEKLY SCAN: Key Stories In The Debate On America’s Health Care Future

Good Friday afternoon, and welcome to the Weekly Scan.  Here are some of the key stories you may have missed in the debate on America’s health care future:

It’s been a tough week for proponents of a new one-size-fits-all government-controlled health insurance system, as economists and experts agree that there’s simply “no way to pay for Medicare for all without tax increases … on the middle class.” 

Last week, presidential candidate Senator Elizabeth Warren (D-MA) released a proposal to pay for Medicare for All that experts agree “significantly [underestimates] the costs,” The Washington Post reports.  “There’s no way it’s $20 trillion,” Kenneth Thorpe, chairman of the health policy department at Emory University, told The Washington Post, adding, “[t]he bottom line is, even with all the big numbers she’s got in there, you’re only getting 55, 60 percent of the way there.”  And Jim Kessler, the executive vice president for policy at Third Way, told The Atlantic “[t]he gap between what she says it will cost and what it will really cost is in the trillions of dollars, and the middle class will be on the hook to fill that gap.”  The Wall Street Journal editorial board adds that Warren’s proposal counts “on ideas for cost-savings and new revenue that are a fiscal and health-care fantasy.”  

And when it comes to the proposal’s $9 trillion tax on American workers, The Washington Post reports that “[b]asic economic theory holds that such payments are essentially a tax on employees because it comes out of compensation.”  Echoing that point, “economists predict that this will get passed onto workers through reduced wages,” Axios reports.  “[P]ayroll costs of this sort are essentially middle-class taxes on employees.  Fixing per-employee business costs at some future date would also be an incentive for companies to reduce their coverage now to reduce future costs.  So employees would get worse coverage than they have now,” The Wall Street Journal adds.

Writing for The New York Times this week, former high-ranking Obama Treasury official Steven Rattner warned of Medicare for All’s “daunting mountain of new taxes and fees.”  And, appearing on MSNBC, Rattner added that “at the end of the day if you want to [implement Medicare for All], the middle class is going to have to contribute to it.”

But, not only would American families face unaffordable new costs under proposed new government-controlled health insurance systems, independent studies and analysts warn that patients’ access and quality of care could also deteriorate.  As Ronald Brownstein explains in The Atlantic:

… But [Linda Blumberg of the Urban Institute] said that reimbursement-rate cuts as big as Warren is envisioning … could lead to hospital closures or service cutbacks … Len Nichols, a health economist at George Mason, also worries that cuts to providers as large as the ones Warren envisions would seriously disrupt the system …  he says such cuts would inevitably force a substantial number of less efficient hospitals, particularly those in small-town and rural markets, to close or transition into outpatient-care centers. “The disruption we are talking about here would be severe,” he told me … like Nichols, [Larry Levitt of the Kaiser Family Foundation] predicted that even with reform, such a constraint on revenues would likely increase the number of hospitals that shut down.  And as in the Urban Institute study, he believes that the new system could create greater delays in access to care …

Meanwhile, The Wall Street Journal reports that efforts to implement a similar one-size-fits-all government-controlled health insurance system on the state level “haven’t ended well,” as the “final numbers were too high to sell” taxpayers.  They explain:

Vermont is the closest test case to the candidates’ Medicare-for-All proposals because it went the furthest in pursuing a single-payer health-care approach … Vermont in 2011 elected as governor Democrat Peter Shumlin, who ran on a single-payer campaign … But no specific funding plan was worked out before the legislature passed a bill calling for the launch of a guaranteed health-care system.  State officials eventually in December 2014 released a financing proposal that would have seen businesses pay an 11.5% payroll tax increase and called for a 9.5% jump in income tax.  The plan came to a crashing halt.

This all helps explain why Democrats are giving “Warren’s ‘Medicare For All’ plan the cold shoulder,” asThe Hill reports, adding: “The proposed elimination of private insurance and its trillions of dollars in tax hikes are prime reasons Democrats cite for rejecting her approach.”  POLITICO notes that “centrists and pragmatists … are starting to hit the panic button,” as well.

  • House Speaker Nancy Pelosi (D-CA)“I’m not a big fan of Medicare for All … Hopefully, as we emerge into the election year, the mantra will be ‘more health care for all Americans,’ because there is a comfort level that some people have with their current private insurance.”
  • Representative Ami Bera (D-CA): “We need to put out proposals that can actually make it into law … We should be proud as Democrats all of our candidates are talking about how to expand coverage, but I don’t see Medicare for All of getting anywhere close to 218 votes in the House and certainly not 60 votes in the Senate.”

And the push by some candidates for Medicare for All “is unnerving Iowa Democrats” as voters in the early caucus state “say they’re scared” about the unaffordable costs and serious political risks of a one-size-fits-all system, The Washington Examiner reports.

As the unaffordable costs of new government-controlled health insurance systems are made more clear to voters, Kaiser Family Foundation CEO Drew Altman writes that support for Medicare for All is “headed in the wrong direction” – meaning down – while “polling shows that support drops much further, and opposition rises, when people hear some of the most common arguments against Medicare for All.”

  • national poll conducted earlier this year by Kaiser revealed that support for Medicare for all “drops as low as -44 percentage points” when people find out it would “lead to delays in some people getting some medical tests and treatments,” and “is also negative if people hear it would threaten the current Medicare program (-28 percentage points), require most Americans to pay more in taxes (-23 percentage points), or eliminate private health insurance companies (-21 percentage points).”

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