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Highlighting the issues with Medicare for All

Since Bernie Sanders’ 2016 Presidential Campaign, the idea of “Medicare-for-All,” or some form of a single-payer health insurance system, has reentered the public sphere. Polling suggests that a majority of Americans support Medicare-for-All in theory, seemingly making it a prudent policy position.

To many, the concept of free government-run health insurance seems appealing, and a step to achieving universal coverage and moving towards a more equitable society. Despite this, there are numerous issues with the current Medicare-for-All plan that has garnered so much attention and admiration.

The first issue with Medicare-for-All is the general public’s understanding of it, or lack thereof. While 70 percent of people support the phrase “Medicare-for-All” in polling, this figure drops to 41 percent when informed that the plan would abolish private health insurance. Only 38 percent of people polled caught on to the fact that private insurance would be abolished under Medicare-for-All, while 22 percent of people incorrectly assumed that taxes would not increase as a result of the program’s establishment.

In short, the general public is broadly misinformed about this policy. As indicated by the polling, support for the program drops immensely when the details of the policy come to light. As more of the public become informed on the details of the bill, support for the program will inevitably drop, making it impossible to pass Congress.

Medicare-for-All is also a costly program, with estimates indicating that it would cost the federal government $3 trillion every year. Even though current federal tax revenue is about $3.6 trillion per year, the federal government is running a $1 trillion deficit. If Medicare-for-All were enacted (replacing expensive entitlement programs like Medicare and Medicaid, which are free health insurance programs for the elderly and poor), this deficit would rise to $3 trillion or more, plunging the U.S. into a debt crisis. 

Also, this fantasy healthcare plan has no politically feasible way to make up for those deficits in taxes. Not Elizabeth Warren’s millionaire tax, which only brings in about $300 billion per year. Not Alexandria Ocasio Cortez’s 70 percent marginal tax rate on extremely high incomes, which would only raise $75 billion per year. Even Bernie Sanders’ comprehensive tax plan cannot raise enough to cover the $3 trillion for Medicare-for-All. Without a way to pay for it, this program would cause uncontrollable government debt, which could be a disaster for the U.S. federal government and confidence in the American economy.

Another issue with Medicare-for-All is the execution of the policy. Many hospitals in the U.S. already charge exorbitant prices for medical procedures. This is partially because they lack pricing regulations, making it economically sensible for them to squeeze as much money out of patients and their insurance as possible, no matter its immorality. 

However, Medicare and Medicaid patients pay lower prices for medical procedures than normal patients. As a result, hospitals with unusually high proportions of Medicare and Medicaid patients find themselves under financial strain and struggle to stay open.

If  Medicare-for-All was enacted, the prices paid to hospitals would continue to be heavily discounted, due to the stress on the federal budget. This revenue cut for hospitals would cause those hospitals in poorer areas to close due to a lack of financial feasibility, while putting many more hospitals under further duress. 

The hospitals most likely to close would be ones servicing regions of poorer and older people, thereby hurting the very demographic the bill is attempting to help. Meanwhile, hospitals in wealthier areas would provide niche operations, ensuring an adequate revenue stream and convenient care for those affluent enough to live near such a hospital. Given that the intention of Medicare-for-All is to benefit poorer communities by providing equitable healthcare, it clearly does not accomplish its goal, and may even hurt more than it helps. 

Despite the infeasibility of Medicare-for-All, realistic solutions for achieving universal health coverage in the U.S. exist. One such proposal is a Medicare buy-in, where adults would enroll in the Medicare program by paying significantly reduced premiums. Under such a program, uninsured adults would be able to gain healthcare. However, employers would still be permitted to offer high-quality insurance to employees, meaning that the number of people using public insurance would be considerably lower. 

The cost of this program is estimated to be about $100 billion per year or less. Although the cost is high, it is nothing compared to the trillions that Medicare-for-All would cost. This program could be paid for by a tax increase like Warren’s millionaire tax, which raises triple the cost of a Medicare buy-in. A more realistic cost for an optional public program is much more likely to garner Republican support than a government takeover of health insurance.

Whether or not Medicare-for-All is a good idea in theory, it will not be successful in practice. It is impossible to pay for such a program, let alone getting it approved by a majority of Congress that is becoming ever more polarized. Meanwhile, it is still unclear whether it would actually benefit those who are uninsured or forced to pay high deductibles, premiums, and copays, given the risk of smaller hospitals closing down. To successfully achieve universal quality healthcare, politicians and voters need to consider more reasonable, incremental programs that have a shot at improving American healthcare for decades to come.

Which policy do you want enacted?


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About the Contributor
Lucas Romualdo
Lucas Romualdo, News Editor: Online Emeritus
Lucas Romualdo (’20) is the News Editor: Online as well as the Student Council Vice President. When he’s not involved in the politics of the school, he’s writing about them almost every chance he gets, mainly covering world issues for his section. Romualdo can also be found most of the time debating politics with his fellow staff members and friends.

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    JehJan 15, 2020 at 10:13 am

    I really like this article. Well done Lucas.