It is not a secret that I believe that a single payer system to cover healthcare costs is in our best interest. One of the struggles is how to pay for it. There is a proposal out there to expand Medicare. I think it is worth exploring.
Administratively, Medicare is already in place. A single administrative body to coordinate the processing and payment of medical expenses. The greatest advantage of this is that it eliminates administrative overhead. Based on a study in the New England Journal of Medicine, the amount of expenditures related to Health Insurance overhead is significant. Consider the few examples that would not need to be part of the process.
Hospital and doctor compliance and monitoring. Doctors don’t just send a bill to the insurance companies. They first have to work with the companies (multiple companies) to understand the terms of the agreement. Then they have to have staff and processes to comply with each one of those companies.
Payement. As with compliance, each company has it’s own process for payment and reconciliation of payments. Each medical practice must manage to each of the insurance companies processes.
Each insurance company has its own administrative overhead to establish, maintain, and manage compliance, accounting / payments. The reason there has been so much consolidation in the industry it that the companies themselves agree there is too much redundancy and recognize the power of consolidating. The problem is that this gives them too much power to dictate terms with doctors, hospitals, and patients.
Employers higher specialist simply to manage and comply with insurance requirements.
Take a look at the study and you will see other areas where we add cost to healthcare but do not add any value. Non-treatment costs for healthcare go upward of 30%.
The supposition of medicareforall.org is that we can drop all private insurance, increase the payroll tax associated with medicare from about 1.4% up to 5% and cover everyone through medicare. The initiative assumes a pretty significant cost reduction through the implementation of a single payer system.
While I think the assessment of 5% may be low, compared to the cost of insurance, which can easily exceed 15-20%% of HHI, even if we double that amount, it will be less for the average household than the cost of insurance.
While our preference is a capitalistic solution, it simply has become untenable. If we believe everyone who needs health care should be able to get it, then a single payer system is the only viable answer. Private insurance adds no value to the equation and in fact adds monetary and significant emotional cost to the process.
If you feel that poor people should not have access, than tens of thousands of people should be ‘allowed to die’, or that families should have to decide between homelessness or medical treatment (families lose homes over medical expenses), the private insurance for some at the expense of others is the better option.