As the Democratic presidential campaign continues to heat up with less than a month until caucus night in Iowa, health care continues to be a top issue. Just behind the “ability to beat Donald J. Trump,” access to quality health care consistently polls as the top policy issue for likely Democratic primary voters, so naturally, it is critical that candidates have a well-defined position.
With U.S. Senator from Massachusetts Elizabeth Warren and U.S. Senator from Vermont Bernie Sanders leading the charge, “Medicare for All” has become a hot button issue on the campaign trail. While the policy may sound appealing to some, a close look at the “Medicare for All” proposals brings into clear focus the potential economic impact and real consequences for the country. The devil is in the details and, in our view, enactment of such policy would have a dire effect on our economy while upending the vast majority of people in our country who are covered by private health insurance.
Decisions Made by Bureaucrats in Washington. Under “Medicare for All,” authority for all for health care decisions would be placed in the hands of government bureaucrats in Washington. Choice would no longer be an option and those who currently get insurance through their employer or in the individual marketplace would be forced to give up their coverage. Further, there would be bias against change and innovation, and it would be increasingly difficult to get new coverage for products or services that are outside the currently established coding system. At present, Medicare in most cases does not raise reimbursements beyond simple inflation but instead drives them down.
Innovation Stifled. With the federal government in charge and reimbursements falling, manufacturers and innovators would not invest in new technologies or treatments. For companies to take the risk to invest in something new, they need to have some reasonable assurance that they will make a return on that investment. This would not happen with the government in the driver’s seat. Countries around the world with socialized medicine, like this proposal, currently depend on the United States to lead the way on innovation, meaning health care innovation would be stifled not just here at home but abroad as well.
Budget Buster. On top of these issues, the biggest problem is that the numbers do not add up. Adding millions more people to a system that is already inefficient would cause utilization to increase, and in turn, taxes on the middle class would likely rise considerably. This would be especially true if “Medicare for All” does not allow for cost sharing.
Jobs Lost. Beyond the problems listed above, there would be a real jobs impact. As one of the largest sectors of our economy, doing away with private insurance would be a job killer. This is especially true in Tennessee where health care has become one of the major industries driving the continued growth of our state economy. Nationally, millions of direct jobs would be eliminated, and jobs in many ancillary industries that rely on health care employers would also be impacted. Wages for doctors and other medical professionals would also be cut because private plans, in most cases, pay more for services, causing further strain on the economy.
There is no question that many aspects of our health care system need to be fixed. And we agree that everyone should have access to good quality care. However, expanding a program that already is moving towards insolvency and putting bureaucrats in Washington in charge will not solve the problem. In fact, it would make it worse. We should instead look for ways to address coverage for those who currently do not qualify without taking away insurance for the vast majority of Americans.
Goetz is senior vice president at Bridge Public Affairs and spends a majority of his time focused on the firm’s growing health care practice. In addition to his significant background in the health care business sector, he is an expert on TennCare and the myriad regulatory details associated with the federal-state program.