With the next presidential election just over a year away, and healthcare still the top issue on voters’ minds, there’s a lot coming at us on the policy side. But it basically boils down to Medicare for All or fixing the ACA.*
Medicare for All is the buzzphrase everyone is tossing around. Medicare is common enough to be understood by most, and all of the candidates are orienting themselves around it, even though most candidates have defined few details of their own plans. It’s no secret in my circle of friends that I am, and always have been, skeptical of Medicare for All. Not as a plan -- I would love to have all that Bernie has promised – but as something that can be accomplished. No, my concerns are practical, namely cost and implementation.
Cost
As of 2017, about 18% of our gross domestic product (GDP) is healthcare costs. Thirty-four percent of that is paid through private insurance. In other words, a full 8% of American GDP comes from the private health insurance industry. That’s a lot. The Medicare for All bill put forth by Bernie Sanders calls for all of the changes to occur in four years. I do not believe that getting rid of an industry that big on that time frame is feasible without a major hit to the economy. I am not economically savvy enough to predict what that could look like, but I am savvy enough to be scared by it.
The basic proposal for Bernie’s Medicare for All plan includes a modest increase on income taxes, which would be offset by not paying deductibles, premiums, and co-pays; more on employer payrolls, which would drop healthcare costs but lose the tax break on what they spent on healthcare previously; and large hikes on the wealthy, estates above $3.5M, banks, and the self-employed. It would also repeal the tax breaks for money spent by employers on employee healthcare. Most of that does not concern me, at least in theory. What does concern me is the ability to get those tax changes through Congress.
Implementation
In fact, getting anything that doesn’t have bipartisan support through Congress concerns me. I was here in Washington when the ACA passed. President Obama used a massive amount of political capital. Advisors would have preferred that he start with physical infrastructure (roads, bridges, etc.), which would have been an easy bipartisan way to start. But knowing there likely would only be a two-year window to pass at major legislation, he picked us – the patients. I’m not sure he realized at the time that he would never regain what he spent.
It was the right thing to do, but even before it had the chance to take effect, Republicans were picking apart the funding and stability mechanisms. And surely the constant attempts to repeal the ACA, including a partial government shutdown, have contributed to the hyper-polarization of the current congress. After John McCain’s dramatic rejection of the last shot at the bill itself in July 2017 – because of procedure, not policy – Newsweek counted over 70 attempts. That’s not counting the successful repeal of the individual mandate, a main source of ACA funding. Will any of the prospective 2020 nominees come into office with the kind of capital necessary to pass another major overhaul? Or the ability to build it? I don’t think so.
So, for right now, I prefer plans that include more incremental changes, or at least ones with a more forgiving timeline than Sanders’ four years. Say, Harris’s plan that allows private insurance to stay as long as they play by new rules, or Buttigieg’s plan that would end up Medicare for All by attrition.
But we haven’t seen all the options. Elizabeth Warren has announced that policy and funding details are imminent. She has the strongest economic/finance background of all of them. It’s certainly plausible that she has come up with something that seems more workable.
Just like everybody else in this town, I’m listening. Convince me.
*Or continuing to attempt the repeal everything President Obama accomplished without anything to replace it, but that is the worst case scenario and I refuse to consider it right now.