Medicare For All

This election cycle has seen a lot of people (mostly Democrats) talking about Medicare-for-all. Republicans often ask, “How can we afford that? Where will the money come from?”

Good questions. Although you seldom hear those questions asked when the government wants a new fighter plane with a projected program cost of 1.5 trillion dollars. (Yes, trillion with a ‘T’.) Or when the government wants a new supercarrier or a new nuclear-powered submarine.

But back to Medicare. There is something I don’t hear politicians mentioning, and that is: Medicare is not free. A worker pays Medicare taxes on every paycheck. Then, at age 65, that worker is allowed to buy Medicare insurance.

Medicare has 4 parts, called Part A, B, C, and D. Part A pays for hospital care. Premiums vary from zero to $437/month, depending on how many quarters of Medicare taxes the insured person has paid. There is also a deductible of $1,364 per benefit period. A benefit period begins when the insured person has been hospital-free for 60 days. A sick person may pay multiple Part A deductibles in a single year. Premiums and deductibles usually increase annually.

Part A only helps with the hospital bill. Doctors you see in (and out of) the hospital are covered by Part B.

Everybody who wants Medicare Part B must pay for it. Premiums are $135.50/month (or more, depending on income) and the deductible is $185/year. These numbers usually increase annually. After the deductible is met, Part B will pay 80% of Medicare’s approved amount. The remaining 20% is yours to pay. You also pay 100% of costs that Medicare doesn’t approve.

Part C (Medicare Advantage) replaces Parts A and B, and Part D helps pay for medicines. Both are bought from insurance companies. Premiums and benefits vary according to the particular plan being bought.

My point is that Medicare does not provide free health care. When people speak of Medicare-for-all, they do not mean free health care for all.

But let’s get back to Medicare-for-all. How will we pay for it? That’s the question Republicans ask. But when you look at Medicare facts, you will quickly see it’s the wrong question. The correct question is, “How will we afford medical care in the US if we don’t move to Medicare-for-all?”

The cost of medical care in the US is rising fast. In fact, it would not be an exaggeration to say health care costs are out of control. If costs aren’t brought under control, health care will become unaffordable for ever greater numbers of Americans. Businesses will find that buying employee health insurance has become unaffordable. Increasingly, full-time employees may find themselves demoted to part-time so their employer can avoid the burden of employee health insurance. Employees without a group health plan will find individual policies unaffordable—assuming they are even available.

While researching this topic, I stumbled across Senator Sanders’ Medicare-for-all paper, titled “OPTIONS TO FINANCE MEDICARE FOR ALL”. I want to quote from the Introduction:

Today, the United States spends more than $3.2 trillion a year on health care. About sixty-five percent of this funding, over $2 trillion, is spent on publicly financed health care programs such as Medicare, Medicaid, and other programs. At $10,000 per person, the United States spends far more on health care per capita and as a percentage of GDP than any other country on earth in both the public and private sectors while still leaving 28 million Americans uninsured and millions more under-insured.

Today, health care spending in the U.S. accounts for nearly 18 percent of our Gross Domestic Product (GDP) and is on track to total over 20 percent of GDP over the next decade. It is projected that if we do nothing and maintain our current dysfunctional system that we will spend $49 trillion over the next decade on health care. That would be an incredible burden on businesses, working families, and the entire economy.

The most cost-effective and popular solution to this health care crisis is to guarantee health care as a right through a Medicare-for-all single-payer health care system.

If we do nothing, the choice we are likely to face won’t be private health insurance versus government health insurance. If costs continue to rise, the choice for many will be government insurance versus no insurance.

I don’t really have a dog in this fight. This is a problem that the next generation will have to confront. To them I say: Sander’s paper is worth a read. It’s only 6 pages long (I know that’s a lot for short-attention-span Americans) and it explores how Medicare-for-all would work and how it would be funded. What we have now is a very flawed system. Its rising costs cannot continue indefinitely. Something has to change. Something will change. When your boat is sinking, clinging to it is not an option.