Jonathan Chait, at New York magazine, says Bernie Sanders’s Medicare-for-all bill “gets America zero percent closer to single payer.”
Chait’s argument, which I largely agree with, is that “single payer has always been, and remains, a political dilemma that nobody has been able to resolve, and there is no evidence the resolution has grown any easier.” But his conclusion — that Sanders “has accomplished approximately zero percent of the necessary work” — misses what I think Sanders is trying to do, and what a reasonable definition of success looks like.
Sanders’s bill stands very little chance of ever being enacted, or of getting America to single-payer. As I’ll explain, it solves precisely none of the problems that have foiled every other single-payer plan in American history. But it stands an excellent chance of getting the country quite a lot closer to single-payer.
What Sanders has achieved here is remarkable. A policy that used to be tentatively embraced by elected officials on the party’s left is now being enthusiastically embraced by key leaders from its mainstream, including the party’s most promising 2020 contenders. Even Joe Manchin, the Senate’s most conservative Democrat, is proclaiming himself open to the idea. Sanders has thrown a rock through the Overton window.
At the same time, it’s important to recognize what Sanders hasn’t achieved, and in fact hasn’t even tried to achieve: He has not solved or even admitted any of the very real challenges to implementing single-payer health care in the United States.
Bernie Sanders’s new Medicare-for-all plan, explained
Asked by my colleague Jeff Stein how he would manage the backlash of canceling literally hundreds of millions of people’s existing insurance plans, Sanders refused to even consider the issue. “It’s not a question of switching plans,” he replied, although it clearly is. Pushed on the possibility that employers could stop paying for health care and pocket the savings as profit rather than pumping it back into wages, he’s noncommittal. “What we are doing is taking an idea out to the American people, and you’re going to see a lot of discussion about these ideas.”
Ask Sanders to respond to the problems his plan might create, or the difficulties of transition, or the political obstacles that have foiled past reformers, and he just … won’t. If you are looking in his bill for answers to the questions that stymied previous single-payer pushes in California and Vermont and Colorado and the US Congress, you won’t find them. In a telling comment to Stein, Sanders said, “What this struggle is about really, honestly, is not a health care debate,” and he seems to mean it.
The debate Sanders is engaging, and looks to be winning, lies upstream from arguments about health care policy. He is trying to remake the political framework in which all future health care debates take place. The Democratic half-measures that follow his plan will be different from the Democratic half-measures that preceded it. He’s changing the party’s definition of success, and thus changing the future path of health policy.
Policy is all about goals
The lesson of the GOP’s repeal-and-replace fiasco is that making health care policy requires a clear sense of your ultimate goals. Absent those goals, it’s impossible to judge the trade-offs, weigh the compromises, and rally supporters around the final product.
The Democratic Party had a clear health care goal. They wanted universal coverage. The Affordable Care Act did not achieve universal coverage. But for all its compromises, deficiencies, and half-measures, it moved the country closer to universal coverage, and that’s why it passed.
This was clearest at the end of the debate, when Democrats had to decide whether to sacrifice the public option, a top liberal priority, or watch the bill die. The Democratic party’s consensus health care aim gave the Obama administration a persuasive, even unanswerable, final argument: The bill’s passage would lead to more coverage, and its failure wouldn’t. At the end of the day, every Senate Democrat — including hardcore liberals like Bernie Sanders — voted for the legislation because it furthered their goals even if it betrayed their preferred means.
By contrast, the GOP tried to make policy severed from any agreement over goals. They wanted to repeal and replace Obamacare. But when the question became, “Replace it with what?” they quickly realized that their party didn’t agree on an answer. Some, like Speaker Paul Ryan, had been dreaming of cutting Medicaid since they were college students attending keggers. Others wanted to protect Medicaid. Some wanted the government out of the insurance game altogether. Others wanted to preserve Obamacare’s coverage gains but restructure insurance markets.
The result was a Calvinball policy process where ideas came and went without any North Star save for a desperate desire to get something passed. By the end of the effort, Senate Republicans found themselves in the absurd position of trying to pass a “skinny repeal” bill that none of them wanted to see become law.
Both parties are now unsettled as to their next steps on health care. Democrats appear to have successfully defended Obamacare, but they have not fixed any of its problems, and its persistent political vulnerability has led to a loss of faith in the form of policy compromise it represented. Republicans are in total disarray.
This is the context in which Sanders’s effort should be understood. He is trying to replace the Democrats’ old goals — universal coverage — with a new goal: single-payer.
The unsolved problems of single-payer
Advocates of single-payer argue that a single-payer system would be better than America’s health care system, and they’re right. Single-payer could, in theory, achieve true universal coverage at significantly less cost. But then, a lot of possible systems could be better than our current system in theory. The problems lurk in the transition from policy paper to reality. For single-payer in particular, three problems stand out, and Sanders’s plan solves none of them:
First, Americans don’t much trust the government, and they’re particularly risk-averse when it comes to health care. The core feature of a single-payer system is, well, that there’s only a single payer. So Sanders’s plan makes it illegal for employers to offer benefits duplicative of his new program, and he folds all existing government insurance programs save for veterans care and the Indian Health Service into the new system.
The upshot of that is Sanders’s proposal will cancel the existing insurance plans of more than 250 million people. It’s a level of disruption that no social reform in American history has dared attempt.
Sanders refuses to admit that this will actually be experienced as disruption. That’s the context for his comment that “it’s not a question of switching plans.” His argument is that no one will have to switch providers, and that’s all anyone really cares about. “You go to the same doctor. You go to any damn doctor you want to go to,” he says.
This fails on a few levels. First, you may well not be able to go to the same doctor. A reform of the size Sanders envisions will have vast and unpredictable consequences throughout the health system. At the simplest level, insuring 30 million more people, and freeing everyone else from financial constraints on care, will sharply increase demand, and overwhelmed doctors will change how they practice. On the other side, the core way this bill will save money is by using the government’s pricing power to pay doctors and hospitals less, and that means some will go out of business, others will begin taking only richer patients who can pay out of pocket, and so on.
But even if that weren’t true, it’s still the case that there will be a period of time — multiple years, in fact — between when people are told their insurance plans will be canceled and when they’re moved onto the new system run by a government many of them don’t trust. And this is happening in a bitterly divided country, where even a reform as comparatively mild as Obamacare led to widespread belief in “death panels” and armed IRS agents going door to door. Imagine this playing out on Fox News. Even now, about a third of Americans hold a negative view of Sanders — how will they react as Fox News covers President Sanders’s effort to take away their health insurance and replace it with socialism?
The next big problem for single-payer is that it rationalizes, concentrates, and clarifies an irrational, diffuse, and hidden financing system. Costs in the American health care sector are fractured amid dozens of payers. Workers have no idea the bill their employer is actually footing for their health care. Medicare enrollees, Medicaid enrollees, subsidized Obamacare enrollees — none of them pay the cost of their coverage in real time. This is inefficient in all sorts of ways, but actually solving it is brutally hard, as it means taking more than $3 trillion in annual spending and translating it into tax increases all at once.
Single-payer advocates argue that total spending in this new system would be lower, and they may well be right. (I say “may” because that depends on whether you squeeze providers hard enough to make up for the increased coverage and utilization, and I’m not sure Sanders’s bill does that.) But that doesn’t solve the sticker shock problem, or the fact that the people who would end up paying more in the new system — and there would be many of them — will fight like hell to stop it. Tax increases on this scale have never been done before, and they’ve destroyed single-payer in every state that’s tried it. (This, by the way, is why Senate Republicans are eagerly asking the Congressional Budget Office to score Sanders’s plan: They want to hang the tax increases around Democrats’ necks.)
One possible response to this is that, well, other countries have passed single-payer plans, so clearly it’s possible. This is a place, though, where America’s out-of-control costs paradoxically make cost control harder. America spends about twice as much per person on health care as other developed nations, and so the tax increases necessary to bring the system onto a single budget dwarf anything any other country has ever tried.
A third problem with the Sanders bill is that single-payer forces the government to decide what is and isn’t covered, and how much all of it will cost. Sanders “solves” that problem by not making any decisions at all. Everything is covered, and there is no cost sharing to speak of, making his “Medicare-for-all” plan far more generous than the actual Medicare program and making his single-payer plan more generous than anything that exists in any other nation. A system like this would massively increase health care use, and thus massively increase costs.
You could possibly counteract those cost increases by sharply lowering how much the government pays doctors, hospitals, drug companies, and so on. But if you cut reimbursement rates across the system that sharply, the system will convulse: Rural hospitals will close, older doctors will shutter their practices, and many, many people will find their care disrupted.
These are hard problems, and Sanders doesn’t solve them. He doesn’t even really admit they exist.
Sanders is changing the definition of success
Sanders’s bill has 16 co-sponsors, including most of the Senate Democrats most often mentioned as possible 2020 presidential contenders. In one fell swoop, he has taken single-payer from an ideal on the margins of the Democratic Party to a goal endorsed by its likeliest standard-bearers.
The Democratic Party could’ve oriented itself around a number of health care goals in the coming years. It could’ve simply sought to improve Obamacare. It could’ve focused on cutting costs, or lowering premiums, or getting closer to universal coverage. But Sanders, I think, has preempted all that: He’s made the goal single-payer.
I highly doubt Democrats will achieve that goal, just as they haven’t achieved universal coverage. But simply agreeing on it changes what counts as progress. Expanding Medicaid is progress toward single-payer. Allowing Medicare to negotiate drug prices is progress toward single-payer. Allowing people of all ages to buy into Medicare is progress toward single-payer. Adding a public option to Obamacare is progress toward single-payer. Pete Stark’s AmeriCare plan is progress toward single-payer.
On Tuesday, I interviewed Hillary Clinton, who lit into parts of Sanders’s plan that she viewed as unrealistic and even politically disastrous. But the health care ideas she emphasized in response — “to open up Medicare, to open up Medicaid, to do more on prescription drug costs” — reflect the influence Sanders has had on the debate. Clinton is proposing half-measures to single-payer in a way that wasn’t common for Democrats 10 years ago.
Similarly, Senate Democrats I speak to are thinking much more now about how to create single-payerish plans that they believe to be more technically and politically sound than the Sanders bill. Some of them are current cosponsors on Sanders bill. My impression is that absent Sanders advocacy, none of them would be seriously thinking along these lines. The same is true for left-of-center think tanks.
Indeed, the most interesting part of Sanders’s bill, for my money, is its transition plan: Over the first four years, before it cancels anyone’s insurance, the plan expands Medicare to cover dental, vision, and hearing aids, makes children up to age 18 eligible, and lets adults over 35 buy in. You could pass that part of Berniecare on its own and have made real progress toward single-payer.
One question you might raise is whether any of this counts as “closer” to single-payer, or whether single-payer is a binary policy that’s either 100 percent enacted or zero percent enacted. I think it’s pretty clearly the former: A world in which anyone can buy into Medicare, and so Medicare slowly takes over insurance markets and expands its bargaining power, is a world in which the system is moving closer to a single-payer-like structure, and where further expansions of Medicare are both easier and more compelling.
Just as important as what counts as progress is what counts as deterioration. If Sanders is successful in redefining the goal of Democratic health policy, other policies Democrats have considered in recent years would now be dead. Raising the Medicare age, which the Obama administration weighed during budget negotiations, is antithetical to moving toward single-payer. Expanding Obamacare’s exchanges so private insurers cover more people and Medicaid covers fewer people is not progress toward single-payer. Adding private insurers into Medicare, as Sen. Ron Wyden has proposed, is not progress toward single-payer. Allowing private insurers to sell skimpier plans in the Obamacare marketplaces, as some Senate Democrats have proposed, is not progress toward single-payer.
By changing the Democratic Party’s health care goal, Sanders is changing the realistic policies that further that goal. In a way that wasn’t true a decade ago, the Democratic Party is becoming a party dedicated to moving the country closer and closer to single-payer. They may not get all the way there — political parties rarely fully achieve their aims — but that’s where they’re going. And it’s Sanders who has put them on that path.