With our health infrastructure crumbling, 50 million folks without health insurance, and a growing sense of urgency, you frequently hear about the evils of "socialized medicine." So I thought, let's take a closer look. Let's do the math, and see just how bad we'll get ripped off if we nationalize health insurance and adopt a single-payer insurance system like what France or Germany or Sweden or Japan or some other backward, socialist liberal country does. Sure and if we do, our health system will go right down the tubes and be like theirs, huh?
Oh, wait. Their systems are all rated LOTS better than ours. Though we do pay about 2.5 times as much, per capita.
For simplicity's sake, I'm just going to figure this as if we expanded Medicare to include everyone. After all, we've already got socialized medicine, which by law is required to try to make itself competitive with private insurance. This is tough, since Medicare operates at about 3% overhead, and private insurers operate at 12% t0 30%. So, by law, Medicare is not allowed to negotiate drug prices, it excludes a huge number of people based on age and ability, and they've got tons of complicated, stupid paperwork that drives health providers nuts and makes them hesitate to accept Medicare patients.
So, my employer pays about $6.35 per hour that I work into private health insurance. Under Medicare, I'd save, conservatively, 10%. (6.35x.1=.635) So, right off the bat, I get a 64 cent raise. Cool.
Then the math gets more complicated. For instance, I know that there will be 50 million more people with health insurance, but how many of them would be taxpayers? I don't know the details well enough – does that number include kids and workers, or just workers? Either way, it's going to spread the premium base, and so bring down the cost. Let's call it another 10 cent reduction in my share. Now I've got a 74 cent raise.
But folks that are uninsured now will have access to regular checkups and wellness programs, so overall emergency room costs will go way down. I don't know how to account for this mathematically, either, so let's conservatively take another 10 cent reduction in my share. And my raise is up to 84 cents.
And what if we allowed Medicare to negotiate drug prices? I wonder how much that would save? I don't know, but it's bound to be significant. Let's say that savings reduces my share another 10 cents. I'm nearing a dollar! (And that's not even counting if we allowed Medicare to negotiate the cost of procedures.)
So what if the paperwork problem were fixed, which should be pretty basic since Medicare wouldn't have to exclude everybody who is young and healthy. That would reduce the costs to providers, so Medicare wouldn't pay as much – say, 6 cents.
Wow! A dollar raise! Just for socializing medical insurance!
What would your raise be?
And how cool would it be if every kid had health insurance? (Real cool, in my opinion.)
Of course, that doesn't account for the fact that the money I pay into Medicare taxes currently goes to cover the oldest, sickest people around – in other words, by adding young, healthy people to the premium pool, my current taxes would go down.
How would this affect health providers? Wouldn't they be totally demoralized by getting paid by a socialized insurance program? Doctors would flock across our borders to work in Canada and Mexico and …
Oh, wait. Yeah, they probably wouldn't. They'd just have an easier time with paperwork. (Believe me, any fix of this nature is not complete without fixing the Medicare paperwork nightmare.) And their liability insurance would probably go down a lot. So their overhead would go down, further reducing costs, and even if their pay got reduced through negotiations, the savings in insurance would likely mean increased take-home.
But you couldn't pick your doctor, right?
Why not? They're all getting paid by the same insurer. Seems like having a license to practice medicine automatically puts them into the preferred provider pool, which means you'd have more choice of which doctor to use.
But there has to be some downside to socializing medical insurance. Right?
Well, it would mean increasing taxes. My share of that would be $5.35/hour (worst case scenario). Which still leaves me a dollar per hour more in discretionary income. I'm actually okay with that. (Some employers might not want to pay out all of their savings on health insurance to wages. So, join a union!) Only Republicans are so anti-tax they'd rather spend lots of money on inefficient private systems and reduce take home wages than surrender their ideology.
For the past 30 years or so, we've been bombarded with the myth that government efficiency is an oxymoron. It's true that government is typically incompetent and inefficient in producing goods and moving them around. But in fact government does excel in certain efficiencies, and one of these is insurance. Social Security, for instance, is an enormous program; yet it operates at under 3% overhead. Medicare is the biggest health care payer in the nation, yet it has by far the lowest overhead of any health insurance company. Continuing down our course of blind ideology to support a myth that the "free market" provides the best service in all situations and circumstances, while the data, both from our own nation and from the rest of the world, proves otherwise is worse than stupid. It's insane. When it means withholding health care from sick people and kids, it's cruel and unjust.
It's also very, very expensive.