There are many reasons, particularly now, why M4A could be a disaster. Sanders’ version does indeed outlaw private insurance, with the new Medicare system taking over the functions of current insurers. If it simply nationalized those systems, keeping workers and infrastructure intact, then the disruption to the system would be lessened, but providers still need to be paid and a system still needs to exist to pay them.
Currently the administrative costs of U.S. health care are around 8%, competitor nations range from nearly 0% to 6% or so. Medicare operates at about 4% but passes much of the work on to private insurance companies. I have Medicare. When I see a doctor or go to a clinic I exclusively use my Advantage plan, which tallies the services and bills Medicare to pay the docs and clinics. Should my insurer be terminated then Medicare will have to assume those tasks and, of course, their administrative costs will go up.
If Sanders’ version is adopted then it will soak some of the administration costs out but at the same time will add tens of millions to the insurance rolls, expand the benefits of all significantly, and swamp the administrative savings with new spending. Not necessarily a bad thing, given that there would be some improvements in health outcomes, but there would also be some harm done to general health. Much “treatment” has negative outcomes, including injury, sickness and death from medical errors and the default to “treatment” rather than lifestyle change for the majority of U.S. health problems that are lifestyle caused.
These are big structural changes, needing big changes to tax law in order to cover the increased costs. Attacking administrative costs that are the consequence of a Byzantine network of insurers is attacking the small tip of the cost problem. The bulk of that problem is the compensation for the care providers, the docs, clinics, hospitals, drug companies that consume most health care dollars. I see no prospect, given current political realities, for passing such massive changes to nearly 20% of the economy in one fell swoop.
I’m an old contractor, I have remodeled/rebuilt hundreds of structures. It’s always much easier and cheaper to build a new structure from the ground up than it is to modernize an old one. Doing so while the tenants still use it is much more expensive and difficult still, even when everybody agrees on the planned outcome. I would much prefer to see our national healthcare remodel worked out piece by piece, swapping the entire thing out on the fly seems like a recipe for disaster.
