“You deserve all the finest things in the world,” a young Homer Simpson once wrote to his beloved Marge, “and although I can give them to you, they will be repossessed.” Senator Bernie Sanders’ Medicare for All Act of 2017 (MFA) makes similarly sweeping promises while relegating financing to a Post-It note, affixed to our national refrigerator: “To do: design and implement the single largest tax increase in human history.”
To his credit, Homer Simpson understood where his generosity would lead.
MFA promises doctor visits, hospitalizations, drugs, home visits, mental-health care, vision, dental, and long-term care—with almost no deductibles, co-pays, or coinsurance. Where promises exceed resources, MFA would erect a multitude of new offices and send out swarms of officers to determine who gets what care, when, and how.
If you like your current insurance, there’s no way on earth you’ll keep that insurance—including present-day Medicare. The two exceptions are Veterans Affairs and Indian Health Service coverage—both plagued by life-threatening problems.
Federal bureaucrats would set prices for everything, based on the worst aspect of today’s Medicare—that program’s crony-driven, out-of-control, Soviet-style reimbursement scheme. Dissatisfied with MFA and wish to buy services or insurance on the side? That’ll be illegal.
Most justifications for this unparalleled power-grab dissolve on inspection:
No, MFA won’t liberate you from insurers. You’ll just trade the frustrations of private insurance for those of public insurance. British health officials once cooked up a requirement that patients go completely blind in one eye before receiving critical macular degeneration treatments—giving the disease time to ravage the remaining eye. (Protests eventually led the NHS to reverse this rule.)
No, Medicare doesn’t enjoy lower administrative costs than private insurers. That bedtime story derives from Medicare having a lower ratio of administrative expenses to health care expenses compared with private insurers. But that’s because Medicare serves older, sicker people whose health care expenses far exceed the average for younger, healthier private insurance enrollees. Higher denominator—not lower numerator. Medicare’s inadequate quality control allows a high rate of fraudulent claims.
No, an enlarged Medicare pool won’t generate significant savings. Currently, the single-payer system serving Medicare’s 55 million enrollees far surpasses the single-payer systems in, say, the Netherlands (17 million), Belgium (11 million), or Canada (36 million)—countries where MFA enthusiasts imagine they see sweet, sweet economies of scale.
No, single-payer systems don’t provide better care than America. For example, Americans’ slightly shorter average lifespan is largely explained by our high rate of violent, instantaneous premature deaths—murder and accidents. That’s a problem, but has nothing to do with health care.
No, it’s not insurer or pharmaceutical manufacturer profits that make American care expensive. Despite perceptions to the contrary, profits in those industries aren’t particularly high, and many American insurers are not-for-profits. MFA would merely replace the duplicative costs of multiple insurers with public sector dynamics that led the Defense Department to pay $2,228 around 1980 ($6,600 in 2017 dollars) for a monkey wrench.
No, America’s high ratio of health care spending to GDP doesn’t result from our insurance system. The primary cause is that Americans have low saving rates and consume loads of everything—including health care. As a percentage of household consumption, American health care spending is only slightly higher than other countries’—with that small difference easily explained by Americans tapping into their enormous accumulated household wealth to buy extra health care.
No, polls don’t mean much. “Most Americans support single-payer” say MFA enthusiasts, but support plunges when you mention that taxes will explode and health care choices will evaporate. Yes, polls show Canadians are happy with their health coverage; but Canadians are happy about all sorts of things—it’s a cultural thing, and there’s something to be said for grumpy, dissatisfied Americans.
No doubt, a high percentage of Americans would like to have a Ferrari. Far fewer would like a Ferrari plus Ferrari car payments. Almost no one would favor Ferrari-for-All: Ferrari car payments, coupled with a promise that politicians and bureaucrats will design and build their Ferrari.
MFA shuffles which gigantic, nonresponsive organizations will control your health care. Our real need is new, more cost-effective modes of care. MFA makes no progress in that direction.