Argument: Single-payer universal health care is empirically more economical

Support

John R. Battista, M.D. and Justine McCabe, Ph.D. “The Case For Single Payer, Universal Health Care For The United States”. Talk Given To The Association of State Green Parties, Moodus, Connecticut on June 4, 1999 – “Myth Two: Universal Health Care Would Be Too Expensive

• Fact One: The United States spends at least 40% more per capita on health care than any other industrialized country with universal health care
• Fact Two: Federal studies by the Congressional Budget Office and the General Accounting office show that single payer universal health care would save 100 to 200 Billion dollars per year despite covering all the uninsured and increasing health care benefits.
• Fact Three: State studies by Massachusetts and Connecticut have shown that single payer universal health care would save 1 to 2 Billion dollars per year from the total medical expenses in those states despite covering all the uninsured and increasing health care benefits
• Fact Four: The costs of health care in Canada as a % of GNP, which were identical to the United States when Canada changed to a single payer, universal health care system in 1971, have increased at a rate much lower than the United States, despite the US economy being much stronger than Canada’s.
• Conclusion: Single payer universal health care costs would be lower than the current US system due to lower administrative costs. The United States spends 50 to 100% more on administration than single payer systems. By lowering these administrative costs the United States would have the ability to provide universal health care, without managed care, increase benefits and still save money.”

Johathan Chait. “An unhealthy mind”. The New Republic. April 6, 07 – “Our system is far more expensive than anywhere else, denies medical services to tens of millions of people except when they have emergencies, and by most measures produces no better outcome. So is there any reason our system “works” except the tautological justification that it’s the best because it’s the most market-based?”

Timothy Johnson. “Universal health care: We can’t afford not to”. USA Today. October 19th, 2006 – “Our present health care “system” (a messy mix of personal, employer and government health insurance) badly needs reform. We spend more than twice as much per person on health care as other industrialized countries do — about $6,100 here vs. an average of $2,550 elsewhere in 2004 — yet we are the only such country that does not provide universal insurance coverage. How can that be?”

Paul Krugman, Robin Wells. “The Health Care Crisis and What to Do About It”. New York Times Review of Books. Volume 53, Number 5 . March 23, 2006 – “A Canadian-style single-payer system, in which the government directly provides insurance, would almost surely be both cheaper and more effective than what we now have. And we could do even better if we learned from “integrated” systems, like the Veterans Administration, that directly provide some health care as well as medical insurance.

Paul Krugman, Robin Wells. “The Health Care Crisis and What to Do About It”. New York Times Review of Books. Volume 53, Number 5 · March 23, 2006 – “Over the years since the failure of the Clinton health plan, a great deal of evidence has accumulated on the relative merits of private and public health insurance. As far as we have been able to ascertain, all of that evidence indicates that public insurance of the kind available in several European countries and others such as Taiwan achieves equal or better results at much lower cost. This conclusion applies to comparisons within the United States as well as across countries. For example, a study conducted by researchers at the Urban Institute found that

per capita spending for an adult Medicaid beneficiary in poor health would rise from $9,615 to $14,785 if the person were insured privately and received services consistent with private utilization levels and private provider payment rates.[4]

The cost advantage of public health insurance appears to arise from two main sources. The first is lower administrative costs. Private insurers spend large sums fighting adverse selection, trying to identify and screen out high-cost customers. Systems such as Medicare, which covers every American sixty-five or older, or the Canadian single-payer system, which covers everyone, avoid these costs. In 2003 Medicare spent less than 2 percent of its resources on administration, while private insurance companies spent more than 13 percent.

At the same time, the fragmentation of a system that relies largely on private insurance leads both to administrative complexity because of differences in coverage among individuals and to what is, in effect, a zero-sum struggle between different players in the system, each trying to stick others with the bill. Many estimates suggest that the paperwork imposed on health care providers by the fragmentation of the US system costs several times as much as the direct costs borne by the insurers.

The second source of savings in a system of public health insurance is the ability to bargain with suppliers, especially drug companies, for lower prices. Residents of the United States notoriously pay much higher prices for prescription drugs than residents of other advanced countries, including Canada. What is less known is that both Medicaid and, to an even greater extent, the Veterans’ Administration, get discounts similar to or greater than those received by the Canadian health system.

We’re talking about large cost savings. Indeed, the available evidence suggests that if the United States were to replace its current complex mix of health insurance systems with standardized, universal coverage, the savings would be so large that we could cover all those currently uninsured, yet end up spending less overall. That’s what happened in Taiwan, which adopted a single-payer system in 1995: the percentage of the population with health insurance soared from 57 percent to 97 percent, yet health care costs actually grew more slowly than one would have predicted from trends before the change in system.”