When Bernie Sanders and Elizabeth Warren rolled out Medicare for All, Republicans, centrists & pundits asked in a resounding chorus: “What will it cost?” Do you remember hearing $31trillion? That fanciful figure framed Republican responses, but it was the voice of wealthy capitalists and owners of health insurance companies that wanted to take control of the narrative. Their motive? Frame Medicare for All as “too expensive.” They screamed about costs and left out any mention of savings.
All Americans need healthcare to survive. It’s been widely reported that citizens in other developed countries pay about half what US citizens pay for health care. Not only that, US healthcare outcomes are the worst in the developed world. Medicare for All would make changes to a private sector system whose purpose (rising profits) is unsustainable. This series will explain how the US health care system can be sequentially adjusted to make it affordable for all.
This article provides Democrats with talking points to replace exaggerated claims about Medicare for All costs with necessary information about Medicare for All savings. Upcoming articles in this series explain how Medicare for All can be implemented with the least possible disruption in our present health care system.
STEP 1: Health insurance companies rig your healthcare costs so they are double what most industrialized nations’ citizens pay.
Capitalist markets are supposed to be regulated by consumers who compare costs among competing providers and choose the best deal. But in our present health insurance markets, there is NO WAY to compare costs and choose the best deal. All costs are hidden by insurance companies, doctors and hospitals. You never know what you’re paying until you get your bill. Our healthcare system is set up so that what we pay is totally controlled by health insurance companies. Your only choices are pay your bill, go bankrupt or die. This is not the case in other industrialized nations.
STEP 2: Health Insurance is NOT Health care
Write down the monthly payment you make to your health insurance company and multiply it by 12. If it’s $1,000 per month, write down $12,000. That money goes directly to your health insurance company’s profit. It does not buy any health care. It gives you the “privilege” of being in a health insurance pool. Currently, the US government’s Medicare program, also health insurance, supports the healthcare needs of US citizens 65 and older by paying around 80% of their healthcare costs. The current Medicare health insurance pool contains more than 44 million people. This segment of the US population has higher health care costs than any other age group.
When you make a claim for health care benefits, your health insurance company(s) will “evaluate” it. They will try to pay as little as possible to both service providers and policy holders. Remember pre-existing conditions? Health insurance companies want to return to the days when even pregnancy was listed as a pre-existing condition.
Health insurance companies charge deductibles and co-pays that increase their profit margins. What you pay for the health care you need is totally up to your health insurance company. You have no way to assess whether these charges have any relationship to the actual cost of the health care you receive. Note that health insurance companies are highly motivated to limit and deny healthcare services to their policy holders. Medicare for All would NOT deny services to increase profits because it is a non-profit operation. Medicare for All will, however, deny fraudulent claims from doctors and hospitals.
STEP 3: Medicare for All will SAVE, not COST you money
To tally what you’d save yearly with Medicare for All, add your current yearly Health Insurance Company premium cost, from Step 2 above, to the yearly total of your deductible and co-pay charges for primary and specialist care. Then add your costs for additional procedures and care. Let’s say that comes to $12,000 premiums, plus $3,000 deductibles and co pays, plus $500 additional procedures and care = $15,500.
Now, list your yearly costs to participate in the Medicare for All health insurance pool. Current yearly Medicare costs about $4,000 to be in the pool; then add your charges for additional care from the example above. This totals $4,000+$500=$4,500. In this example then, Medicare for All would save you: $15,500-$4500 = $11,000.
If your employer currently pays all your health insurance and health care expenses, realize that those payments are part of your reimbursement for employment and are taxed as such. Because health insurance premiums have increased 400% in the last 20 years (reported by the Kaiser Family Foundation in Wendell Potter’s article on page 1 of the 12/1/19 issue of The Progressive Populist), employers have been increasing both deductibles and co-pays that you pay to help them defray their increased Health Insurance rates. Many think their employer is paying all their health care expenses, even though this has changed. Often employees don’t discover changes in their employee health plan costs until they make a claim. It’s wise to check changes in your employer health plan at least once per year.
Summary
When Medicare for All is implemented, it will save, not cost, US citizens money. In addition, US healthcare outcomes, currently the worst in the industrialized world, would most likely improve, because ALL US citizens would have health care. This would move the US out of third-world healthcare status.
Basic US healthcare system expenses include: health insurance, doctors, hospitals and taxes. With Medicare for All, your healthcare expenses will be restructured so that less is paid to health insurance companies, doctors & hospitals (where price gouging is rampant) and more is paid by progressive taxation where higher income earners pay a higher percentage of taxes than lower wage earners. Phasing in Medicare for All will require a restructuring of health care markets and health insurance company practices. The next article in this series will describe a phase-in plan which would ease the restructuring process for all affected individuals and companies.
Tom Johnston, M.U.P., M.Ed., has dealt with multiple health insurance companies as a healthcare practitioner since 1980. An experienced political analyst, he graduated from the University of Michigan in political science and international relations, founded & directed a state-licensed vocational school, was the urban planner for the Pike Place Market in Seattle and served as a US Naval officer.
From The Progressive Populist, February 1, 2020
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