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Pick your poison on Democrats’ health care ideas

More than 100 House Democrats have signed onto a new bill from Washington Rep. Pramila Jayapal that would outlaw private insurance and force everyone into a government-run health plan.

Some other Democrats are leery of Jayapal’s bid for “Medicare for All.” So they’ve rolled out more “moderate” measures that would expand the existing Medicare program.

Don’t be fooled. Whether branded as Medicare for All or Medicare for More, the Democrats’ health reform plans would yield the same thing — a government takeover of the American health care system.

The new House bill is a close relative of Sen. Bernie Sanders’ 2017 Medicare for All plan. Both would cover everything from primary care and hospital visits to dental, vision, and hearing benefits. There’d be no copays or deductibles; patients would be responsible for a small amount of the cost of prescription drugs. The only people not subject to the new plan would be those covered by the Veterans Health Administration and the Indian Health Service.

An independent analysis of Sanders’ 2017 plan from the Mercatus Center estimated its cost at more than $32 trillion over its first 10 years. Doubling what the federal government takes in corporate and individual income taxes wouldn’t be enough to cover that sum.

Jayapal’s bill would likely be even more expensive, as she’s added a long-term care entitlement and would end private insurance in two years, as opposed to the Sanders plan’s four years.

Most Democrats recognize that these single-payer bills aren’t going anywhere, as long as Republicans control the Senate and White House. Further, the American people aren’t yet on board with single-payer. Six in 10 oppose Medicare for All after they learn it would eliminate private insurance and raise taxes.

More pragmatic Democrats are pushing to expand Medicare instead. In February, lawmakers in both the House and Senate introduced bills informally known as “Medicare at 50.” The companion legislation would allow people 50 and older to buy Medicare plans through the Obamacare exchanges.

In theory, this proposal wouldn’t upend America’s private insurance system. In reality, it’s an attempt to sneak single-payer through the back door.

Medicare reimburses hospitals and doctors at artificially low rates. In 2017, the program paid hospitals about $54 billion less than they spent caring for Medicare patients.

Allowing people in their 50s and early 60s to enroll in Medicare plans would increase providers’ losses. Hospitals and doctors would be forced to charge private insurers ever-higher prices to offset their losses on Medicare patients. Consequently, private insurance premiums would skyrocket.

In other words, a Medicare buy-in bill would present anyone over 50 with a “choice” between artificially cheap government insurance or increasingly pricey private plans. Customers would flee the private market in droves.

As the number of customers in the private market declined, insurers would increasingly leave. Younger patients would find themselves with fewer affordable insurance options to choose from. The government would feel compelled to step in and ratchet the enrollment age down further. In relatively short order, what had been Medicare for More would become Medicare for All.

Then there’s another supposedly moderate proposal, “Medicare for America.” This plan draws on the work of Yale professor Jacob Hacker and the Center for American Progress. Reps. Rosa DeLauro and Jan Schakowsky are leading the charge for this bill; presidential candidate Beto O’Rourke just endorsed their plan.

This bill would put everyone covered by Medicare, Medicaid, or an Obamacare exchange policy onto a new government plan. Everyone else would have the option to purchase Medicare plans with deductibles no higher than $350 for individuals and $500 for families.

The proposal wouldn’t ban employer-sponsored insurance. But it would require employer plans to cover the same extensive benefits as the new Medicare plan. If employers were unwilling or unable to pay for these generous plans, they could instead contribute 8 percent of their annual payroll to a Medicare trust fund.

The many employers who spend more than 8 percent of payroll on health benefits would likely be tempted to pay the tax. Employer-sponsored plans would gradually disappear.

Most congressional Democrats have the same end goal — government-run health care for all Americans. They simply disagree about the best way to get there.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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