“Medicare For All” Evokes Fears Even Among Democrats
The idea of Medicare for all has gained in popularity and even inspired some serious discussion lately. This idea can look quite appealing as long as we don’t think too much.
The United States stands out in a lot of different ways, and one of the notable ones is the country’s lack of universal health care coverage. While the U.S. does offer programs like Medicare for seniors and Medicaid for the poor, most Americans get their coverage from private insurance either provided by their employer or purchased on their own.
For many years, plenty of Americans have pined away for universal coverage, where the government funds and administers health care insurance and also offers it to everyone regardless of their circumstances. While this involves what is essentially a socialist approach to health care, where higher-income people subsidize the health care expenses of those of lesser financial means, a lot of what the government does can be seen as socialist in nature already, so from a philosophical point of view this would not be that much of a departure.
The criterion that is usually used in what we could call socialist democracies, which is what modern-day democracies really are, is one of need, where a safety net is sought to be created. With a lot of expenditures, ones that define one’s lifestyle like the kind of house one lives in or the kind of car one drives, people are free to further their desires to enhance their lives within their means to so, but we set a floor here, and beneath it is considered socially unacceptable.
Universal health care is actually quite distinct from your normal social program though, as it seeks to not only address those beneath this floor, it looks to expand this scope to the entire population.
While some public health insurance schemes do allow people to upgrade their care through adding additional private insurance or paying out of their own pocket, even this may be disallowed, and we often see private insurance completely take over both the delivery and payment of health care.
Left-wing politicians tend to focus on what we could call the social justice element in universal health care, but if that was the main goal, this objective could be completely achieved by expanding the welfare aspect of health insurance. Desires to implement universal public health care insurance go way beyond that though, much like putting everyone in the country on welfare and paying them all the same amount in order to help those who do not make enough to survive on.
The Practical Considerations of Medicare for All Have Sharp Teeth
So many countries have public health insurance that this fact can get lost on us, where we just look at the fact that everyone in Canada for instance can get all the health care they need regardless of who they are, think that this is a fine idea, and want the same thing for Americans. We all would then eat at the same restaurant so to speak and it’s an all you can eat buffet as well, as well as many having the false impression that it’s all you can eat for free.
If we are to consider such a thing in the United States, we at least need to get clear on what the objective actually would be with this, and it would not be to just ensure that every American is adequately served by health insurance and health care. This really is about whether the government can do this better than private industry, and better enough that this warrants us essentially tossing this industry out on the street and seizing the reins of power and using it to reign over everyone.
We are seeing more of a transition towards this type of argument though, which is a big improvement over looking to justify such a system for its social justice merits. These are separate issues entirely, and we need to ensure we see them clearly enough that way.
The latest campaign from the Democratic side is called “Medicare for all,” and it is gaining traction among the more left leaning members of the party. While the Democrats had enough trouble pushing through the far less contentious program known as Obamacare, and the chances of passing anything remotely resembling Medicare for all would have no chance in today’s Congress, the hope is that at some point the Democrats may have enough control over both the House and Senate as well as the presidency to make this at least a viable possibility.
The talk these days is that a public system would be more efficient, allowing the government to much better manage costs. Health care costs are much higher in the U.S. than in other countries, and those with public systems do enjoy a monopoly over health care, which can certainly be used for the benefit of lowering costs overall.
Something Does Need to Be Done, But We Need a Sensible Approach
It is clear that we do need to do something on this front, and something very substantial, as health care costs in the United States are spiraling way out of control and things are only going to get a lot worse if we simply follow the present course.
The transition to universal public health insurance would be an extremely expensive one. While the goal would be to reduce the percentage of GDP spent on this, the structure of Medicare for all would have the government bear the entire load, estimated at $32 to $33 trillion over the first 10 years.
This is a number that even scares some of Democrats, and while those who are particularly eager for such a plan, like Bernie Sanders, may not be put off enough by this enormous cost, there is more to worry about than just this, although the cost itself would be very prohibitive.
With the very real prospect of Medicare in its current conception collapsing in the coming years, due to reaching the point where the government can no longer fund it, we may wonder how the government may be expected to pay for a Medicare scheme that is far more expensive. You can raise taxes of course, but the worry is that we won’t be able to efficiently raise taxes to save Medicare or Social Security as they exist now, let alone bear the monstrous costs that Medicare for all would involve.
Sen. Sanders does point out that this will save Americans a lot in out of pocket costs, which of course will be the case since this money will no longer be coming out of their pockets at all anymore. More importantly, if managed well, this could reduce overall health care costs significantly, something the country desperately needs.
Like all plans though, there are practical considerations, and the concerns here are pretty major ones, starting with the enormous price tag, and also involving how we may transition from the current system to Medicare for all. Rep. Cheri Bustos of Illinois, chairwoman of the Democratic Congressional Campaign Committee, is particularly concerned with how this transition would play out, calling it “a little scary” and adding that “it’s just hard to conceive how that would work.”
By taking on the $3 trillion a year bill for this, this will also displace a whole lot of people, and lay waste a lot of very valuable companies, as a huge segment of our economy meets the wrecking ball. The damage here would be almost unimaginable.
If the price doesn’t get you, this part should. We do need solutions here, but ones that deliver the goal of reducing costs at a price tag we can afford, and without cannibalizing a major sector in its wake.
Editor, MarketReview.com
Robert really stands out in the way that he is able to clarify things through the application of simple economic principles which he also makes easy to understand.
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