As Democratic presidential candidates debate health care reform, it’s essential that they understand exactly how much universal coverage would cost. While it’s true that single-payer systems such as Bernie Sanders’ Medicare for all proposal would cost more than the federal budget, by measuring only that figure we miss the bigger picture: universal health coverage would bring numerous advantages that far outweigh any costs to government coffers.
The nonpartisan research arm of Congress, the Congressional Budget Office estimates that various single-payer options could reduce national health spending in 2030 by an estimated range of $1.5 trillion to $3.0 trillion relative to current law (which includes government spending on health insurance programs plus forgone tax preferences). However, savings wouldn’t occur until after implementation had taken place – due to lower cost-per-beneficiary payments and administrative expenses for medical providers and reduced out-of-pocket medical expenditures for patients.
Medicare for all would bring tremendous advantages to most Americans. Most families who currently pay health insurance would spend less on premiums, copays and deductibles under this plan, saving money and giving them more disposable income to spend elsewhere. Families making over $60,000 would save up to 14% off annual health costs according to Urban Institute research.
Medicare for all would bring savings for most families while helping our society control overall costs. Our astronomical health care spending stems from private insurers paying different prices to doctors, hospitals and other health care providers, which allows them to cherry-pick healthier patients at different prices and ultimately threatens our nation’s healthcare system financially. Under Medicare for all system, government would establish budgets and payment rates. This may help bring down medical costs; if rates were too low however hospitals might face financial difficulty and close.
Our research indicates that shifting to a Medicare for all system will take some time for it to gain efficiency and bring costs down, but by 2022 our estimates indicate the federal government would save an estimated total of 338,000 lives each year through reduced premature deaths and increased productivity gains, saving 1.73 million life-years each year.
Finally, our estimates of Medicare for all do not account for the costs associated with long-term care coverage under this policy. Most proposals call for paying providers the same amounts they currently receive under Medicare even though this would lead to greater overall government expenditures.
Medicare for all would drastically lower Americans’ healthcare spending while offering significant economic advantages to most households, making it the most cost-effective, equitable, and responsible solution to ensure health coverage to all American citizens. If you want to gain more insight into its advantages then read KHN’s full report!