Massive government takeover of healthcare would create single-payer healthcare system, doing away with Medicare Advantage and individual choice

All clinical laboratories and anatomic pathology groups have a strong interest in how any reform of US healthcare at the federal level might be accomplished. In that spirit, Dark Daily is providing a quick overview of the Medicare for All Act of 2019 (HR 1384). The name is misleading. The bill would actually end Medicare and all private health insurance in America.

This element of the proposed bill has not gotten much attention in national media coverage. If Congress did pass the bill as proposed by newly elected US Rep. Pramila Jayapal (D-Wash.), it would eliminate all existing private health plans, as well as the existing Medicare program! That includes Medicare Advantage, which serves 20 million seniors. HR 1384 would replace all of these health programs with a national service-on-demand government-funded system.

Though it’s unlikely to advance through Congress, the fact that this massive federal program is even being considered reflects the thinking certain Congressional representatives have about single-payer health systems.

According to the Seattle Times, the proposed “Medicare for All” program would pay for:

  • Primary care;
  • Prescription drugs;
  • Dental and eye care;
  • Long-term care;
  • Reproductive health; and,
  • Mental-health and substance-abuse treatments.

Though patients would not be charged premiums, copays, or deductibles, no healthcare funding mechanism was actually included in the legislation.

Not All Democrats Are Onboard with Medicare for All

Though more than 100 democratic lawmakers in the House of Representatives are co-sponsoring HR 1384, the legislation has failed to win over key Democrats, including House Budget Committee Chairman John Yarmuth (D-Ky.), who criticized the bill for going beyond an expansion of the Medicare program.

“I don’t consider that to be Medicare for all. It’s universal healthcare, on demand, unlimited,” Yarmuth told The Hill. “It’s all single-payer, no private insurance. It’s a very different thing than Medicare.”

It’s no wonder some oppose HR 1384. The bill proposes to abolish the private health insurance industry, which employs upwards of a half a million people and covers 250 million Americans, noted The New York Times (NYT).

“[Health insurance] companies’ stocks are a staple of the mutual funds that make up millions of Americans’ retirement savings. Such a change would shake the entire healthcare system, which makes up a fifth of the United States economy, as hospitals, doctors, nursing homes, and pharmaceutical companies would have to adapt to a new set of rules,” the NYT added.

Shifting Attitudes Concerning National Healthcare Impact All Healthcare Providers

The legislation is unlikely to become law—especially since single-payer healthcare is not likely to gain traction in the Republican-controlled Senate. Nevertheless, HR 1384 has vaulted “Medicare for All” from a fringe policy proposal to a front-and-center national debate among 2020 Democratic presidential hopefuls.

Democracy for America (DFA)—a one-million-member political action committee—labeled the proposed legislation “the new gold standard” for healthcare transformation.

“Congresswoman Jayapal’s bill establishes a new gold standard in the fight for a practical, cost-efficient way to provide a single standard of quality healthcare to everyone,” DFA CEO Yvette Simpson stated in a press release.

Many health providers disagree. The concept of single-payer healthcare system faces strong opposition from hospitals and health insurers, which are likely to remain a formidable roadblock to universal healthcare.

“I’m disappointed any Democrats are going off on this tangent,” Charles Kahn III, President and CEO of the Federation of American Hospitals, which represents investor-owned and managed community hospitals, told the Washington Examiner. “They should be focusing on the advances that were made under the Affordable Care Act.” (Photo copyright: Federation of American Hospitals.)

A single-payer healthcare system also would result in a massive spending shift, according to a study conducted by the Mercatus Center at George Mason University. The study’s author, Charles Blahous, PhD, states that Medicare for All (M4A) “would place unprecedented strain on the federal budget.”

In “The Costs of a National Single-Payer Healthcare System,” Blahous notes that “by conservative estimates, this legislation would have the following effects:

  • “M4A would add approximately $32.6 trillion to federal budget commitments during the first 10 years of its implementation (2022–2031).
  • “This projected increase in federal healthcare commitments would equal approximately 10.7% of GDP in 2022. This amount would rise to nearly 12.7% of GDP in 2031 and continue to rise thereafter.

“These estimates are conservative because they assume the legislation achieves its sponsors’ goals of dramatically reducing payments to health providers, in addition to substantially reducing drug prices and administrative costs,” he continues.

“A doubling of all currently projected federal individual and corporate income tax collections would be insufficient to finance the added federal costs of the plan,” Blahous concluded.

Medicare for All does not appear primed for passage in Congress. However, clinical laboratory administrators and pathologists should note that single-payer healthcare is no longer a fringe idea within the Democratic party. The concept seems to be steadily moving into the mainstream of political debate. It is a debate with the potential to dramatically change how clinical laboratories and anatomic pathology groups get paid for their diagnostic testing services.

—Andrea Downing Peck

Related Information:

Medicare for All Would Abolish Private Insurance: ‘There’s No Precedent in American History’

Key Dem Chairman Voices Skepticism on ‘Medicaid for All’ Bill

DFA: Jayapal’s Medicare for All Act Sets ‘Gold Standard’ for Vital Healthcare Transformation

Jayapal to Introduce Medicare for All Bill That Overhauls Nation’s Healthcare System

Hospitals Present a Major Roadblock to Medicare for All Act

The Costs of a National Single-Payer Healthcare System