Bernie Sanders and other lawmakers have proposed that America expand Medicare to cover all Americans. This is a very reasonable idea. It would lower the cost of healthcare for Americans by eliminating insurance company profits, marketing costs, huge executive salaries, and income taxes and it would ensure that every American citizen has access to affordable healthcare.
What we are talking about is a change in how we pay for healthcare for American citizens. The proposal would not affect how doctors and hospitals perform medical care.
Presently healthcare for Americans is paid for using four different systems:
- Some low income Americans qualify for Medicaid which is a state government program that pays for basic healthcare for those who qualify. Medicaid rules vary from state to state.
- Americans 65 and over use Medicare to pay for their healthcare. Medicare enrollees pay a monthly premium and deductibles and co-payments, and Medicare taxes are used pay the rest of their medical bills. Medicare is funded from payroll taxes of 1.45% on employees and employers.
- Working Americans are usually enrolled in a private health insurance plan. Private health insurance may be obtained through an employer or it may be purchased by individuals. Obamacare is made up of private insurance plans.
- A few Americans just pay cash for their medical expenses without assistance from health insurance or a government program.
Health insurance companies are in business to make money and they make a lot of money. In 2016 the top five health insurance companies made over $20 billion dollars profits off of the healthcare industry. The CEO of UnitedHealth Group was paid $55 million, and the total executive compensation for the top five health insurance companies (UnitedHealth Group, Anthem, Aetna, Cigna, and Humana) was $214 million dollars paid to about 24 individuals. You can see why the health insurance companies will put up a major fight to stop Medicare from taking a large share of business away from the health insurance business.
Medicare hires private contractors to perform the medical claim processing work through a very competitive bidding process. Plus, Medicare does not take any profits or executive salaries from the healthcare claims they process and pay. As a result Medicare administrative costs are significantly cheaper than private health insurance companies.
The great divide on health care in America is whether sickness and health care is a terrific source of huge profits or whether access to affordable healthcare is a public need.
AMERICAN HEALTHCARE COSTS
The United States pays far more per person (and in total dollars) for healthcare than any other nation on earth. In 2014 America paid $9,024 per person for healthcare, compared to $4,506 per person for Canada, $3,971 for people in Great Britain, and an average of $3,620 for all developed nations. No nation on earth paid more per person for healthcare than America.[i]
Citizens in the United States do not live longer or stay healthier for the extra money they spend on healthcare. Medical practice standards are the same in all developed nations of the world. The procedures, treatments, and medications available to Americans are the same ones available to citizens in Canada, France, Great Britain and all other developed nations.
The extra money that America pays for healthcare goes for profits. America has more healthcare billionaires than any other nation on earth. America is the best place in the world to sell your healthcare products and services to make the most money.
Healthcare providers in Canada, France, Great Britain and every other developed nation make good profits and there is nothing wrong with that. But America is letting some healthcare businesses exploit healthcare to harvest excessive profits far beyond amounts needed to sustain and grow the businesses and support innovation. America’s indulgence of this greed it is causing major economic problems for our nation that will only get worse if it is not restrained. America cannot afford to let healthcare costs keep rising far above what the rest of the developed world pays.
THE HEALTH INSURANCE BUSINESS
Most Americans rely on health insurance to pay for healthcare expenses. The health insurance company sits between the patient and the doctor, collecting money from the patient and the patient’s employer, and paying part of it out to the doctors and keeping as much as possible as profit. Since insurance companies are profit-seeking businesses they work to extract as much money from the healthcare business as possible. Some health insurance companies have been extremely ruthless in the things they do to profit from health care.
Do you take my insurance?
Every health insurance plan restricts which doctors and hospitals you can use. This is called the provider network. “Provider” is the insurance term for all of the doctors, clinics, hospitals, and others than provide medical services to patients. Health insurance companies set up provider networks that pay the providers specific amounts of compensation for every billable medical procedure. Some provider networks offer very low compensation amounts while other networks offer more attractive amounts. When a doctor signs up to participate in a particular network he agrees to accept the payment amounts in that network as total payment for his medical services. The provider networks that offer low compensation amounts have the fewest doctors and hospitals in them. Every health insurance plan is tied to a particular provider network, and the insurance customers in that plan must use the doctors and hospitals that are in that particular network for the insurance company to pay the medical bills.
Conflict of Interest
When a health insurance company refuses to pay a claim the money they save is profit. This fact means that health insurance companies have a conflict of interest between their duty to investors to maximize profits, and their obligation to customers to pay their medical bills. Most American adults have had the experience when their health insurance company denied a medical claim with the excuse that it “Exceeds reasonable and customary amount”, “Not a covered procedure”, “Out of network provider”, “Treatment classified as experimental”, or “Treatment deemed not medically necessary”.
When the health insurance company denies a medical claim it can have a catastrophic effect on the financial situation of the patient. At the time the patient decided to go get medical treatment they believed that the insurance company would pay the bills. When the insurance company denied the claim the medical treatment has already been provided and the person is unexpectedly obligated to pay all of the medical bills using their own financial resources. Medical bills can be very large. When this happens it disrupts personal financial planning and it can have a very bad impact on the quality of life for the patient and his entire family. Sometimes this sequence of events can impose bills on a family that exceeds their ability to pay resulting in the loss of all of their liquid assets. It made matters worse when in 2006 big business lobbied Congress to change bankruptcy laws to make it harder for individuals to dismiss medical bills through bankruptcy.
Fake Provider Network Scam
Health insurance companies intentionally plan and scheme to mislead Americans about what the health plan will pay for. When the Patient Protection and Affordable Care Act (also called Obamacare) was enacted, it created a website Healthcare.gov where Americans could go each fall to shop for a health plan. The major health insurance companies offered plans on Healthcare.gov with different prices and benefits. For each of the listed plans, American shoppers could enter the names of the doctors and hospitals they would like to use to see if the plan would allow it (in-network). Some insurance companies deceived shoppers by posting provider lists Healthcare.gov than had a large selection of doctors and hospitals, but these network lists were false. Then in January when the enrollees tried to see their doctor they discovered that their favorite doctor as not in the network for the plan they selected and they could not change the plan until the next enrollment period for the next year. They were stuck using the limited selection of doctors that were actually allowed by the insurance company they had been tricked into selecting.
UnitedHealthcare Group Scam
To understand just how ruthless and unethical health insurance companies can be you need to be aware of some illegal things that America’s largest health insurance company was caught doing.
In 2006 the CEO of UnitedHealthcare Group was a man named William W. McGuire. In 2005 Dr. McGuire was paid $125 million as CEO of UnitedHealth Group. [ii] In 2006 the SEC began investigating Mr. McGuire and several other UnitedHealthcare executives and found that they participated in a scheme to back-date stock option compensation awards to steal from investors and fraudulently enrich themselves. Here is an intelligent man with a great job who made $125 million the previous year and he not only cooked up an illegal scheme to cheat and steal millions of dollars, he persuaded UNH director William G. Spears, General Counsel David J. Lubben, and several other senior managers to go along with the scheme. Under pressure from the SEC and prosecutors (that is, the government). McGuire resigned from UnitedHealthcare but he was still paid about $1 billion in severance pay; the UnitedHealth Group board of directors apparently decided that McGuire’s behavior was not bad enough for him to lose his severance pay. McGuire was never prosecuted.
Reasonable and Customary Scam
Remember when the insurance company denied your medical claim because they said the amount that the doctor charged exceeded the reasonable and customary amount allowed for the treatment? In February 2008, New York State Attorney General Andrew M. Cuomo announced an industry-wide investigation into a scheme by health insurers to defraud consumers by manipulating reasonable and customary rates.[iii] Cuomo found that incorrect health care cost records had been stored in a database maintained by Ingenix so that they could be used by health insurance companies as fake proof to deny medical claims, thereby pushing costs down to members and enhancing the insurance company profits.
America Needs To Get Insurance Companies Out Of The Healthcare Business
Now you understand why the executives of health insurance companies will do anything to stop Americans from adopting another way to pay for medical care and how ruthless they can be in pursuit of their goals.
Many developed nations do not use insurance to fund healthcare because of the inherent conflict of interest and the cost of profits. America needs to get insurance companies out of the healthcare business.
WHAT IS MEDICARE?
Medicare was enacted by Congress in 1965 as a system to pay most healthcare bills for Americans 65 and older. Medicare does not have any government doctors or hospitals; Medicare patients get health care from private doctors and hospitals of their choice. Most doctors and hospitals in America accept Medicare. Presently 55 million Americans are enrolled in Medicare.
Medicare implements rules that clearly define what medical treatments are covered, how much enrollees pay in premiums, deductibles and copayments, and how much the providers will be paid. Because Medicare rules are stable year after year, Doctors and patients know what is covered so there are no surprises. Medicare is administered by CMS, which is part of the federal Health and Human Services (HHS). The administrative procedures and computer systems that run Medicare are refined and they work very well.
Expanding Medicare to cover more Americans involves expanding a working system that all doctors and hospitals and millions of Americans are already familiar with. Medicare works.
No Conflict of Interest
Under Medicare the actual work of processing claims is performed by private contractors that bid to do the administrative work on competitive contracts. Medicare contractors receive a few pennies for each claim they process. The contractors do not make any extra money if they deny a claim. This eliminates the conflict of interest that private profit-seeking insurance companies have with their customers.
Medicare Advantage – Private Insurers Can Compete For Medicare Business
Medicare includes an option called Medicare Advantage where private insurance companies offer insurance plans to compete with standard Medicare. Medicare Advantage insurance plans must comply with Medicare standards and provide a certain minimum coverage and benefits. Standard Medicare Advantage plans cost the same as Medicare, and companies also offer enhanced Medicare Advantage plans that provide richer benefits for those enrollees willing to pay the higher monthly premium.
WHAT IS MEDICARE-FOR-ALL?
Medicare-for-all is a proposal to expand Medicare to make it available to American citizens of all ages. It would replace most of the private individual and group health insurance plans and eliminate all of their different rules, procedures, forms, schemes to deny claims, and the provider networks that limit patients choices of doctors and hospitals. Under expanded Medicare every American that enrolled would be covered by standard Medicare or an optional Medicare Advantage plan to pay their medical bills and you would be able to choose the doctor and hospital where you get medical care. Most doctors and hospitals in America accept Medicare.
The details of how Medicare-for-all would be implemented need to be discussed and decided in Congress. For this important national policy we need to find solutions about how to share the cost that are fair to all Americans. Every American citizen needs access to affordable healthcare. This needs to be a bipartisan discussion with support from both Democrats and Republicans. Questions need to be decided about how Medicare would be expanded and phased in, and what taxes and fees would be used to pay for it.
Medicare is Cheaper
Overall Medicare-for-all will be cheaper than private insurance since Medicare does not take out money for marketing & advertising, profits, income taxes, and big executive salaries. Insurance companies spend 18% of premium revenue on administrative costs. Medicare spends just 2% on administrative costs.
But the savings from adopting Medicare-for-all would not automatically be spread equally among all Americans. When employer group insurance plans are replaced by Medicare-for-all, companies would save the money they now pay for these plans. One idea is to expand employer payroll taxes to use the money companies no longer spend on group health plans to pay a major part of the cost to expand Medicare. There also needs to be a way for self employed Americans to participate in Medicare-for-all and pay their fair share.
Current Medicare enrollees pay part of the cost of Medicare through a monthly premium, and deductible and copayment amounts. There is no reason to change this if Medicare is expanded. In fact, any system to expand Medicare must preserve the Medicare benefits that older Americans now rely on. Expansion of Medicare must not reduce benefits or increase costs for retirees.
Medicaid is a program that helps low income Americans get access to healthcare. Medicaid is administered by each state according to its own rules. We need to decide whether Medicare-for-all should be extended to cover low income Americans and replace Medicaid or if Medicaid should be left in place to provide coverage for those Americans who cannot afford to pay the premiums and deductibles for Medicare.
Single Payer is another term that is used during the discussion of health care financing reform. Single Payer means a system where a single entity like Medicare pays the medical bills for all Americans instead of having dozens of different insurance companies, each with different rules, forms, and administrative procedures.
WHY MEDICARE FOR ALL IS BEST FOR AMERICA
Relying on Medicare to pay for medical care rather than the assortment of private insurance plans would improve American citizen’s access to affordable healthcare because it would:
- Cost less due to the elimination of insurance company profits and executive salaries.
- Cover everyone including individuals with preexisting conditions.
- Eliminate the conflict of interest that insurance companies have.
- Eliminate the insurance company tricks and schemes they use to not pay claims.
We need to get insurance companies out of the healthcare business. How would you like it if someone from the insurance company called up and asked you if you got any exercise last week or if you are eating healthy food? (This happens in America.)
WHY INSURANCE COMPANIES HATE IT
Health insurance companies have things the way they want it right now. They have wormed their way into the healthcare business to so they can squeeze billions of dollars out of the patients and the healthcare providers every year. Healthcare insurance company executives have gotten extremely rich off of healthcare. Medicare-for-all would disrupt this situation, reduce the cost of healthcare for Americans, allow Americans to go to almost any doctor or hospital, and eliminate the insurance company scams they use to collect premiums and not pay claims.
To prevent this, the health insurance industry will say or do anything to prevent Congress from passing Medicare-for-all or any similar proposal. They will publish false information to mislead voters. They will set up fake research and policy institutes to publish false studies that say Medicare-for-all will be terrible. They will pay professors and experts to lie. They will give money to buy off members of Congress whenever they can. Health insurance company executives are smart, motivated, energetic, ruthless, and they have enormous amounts of money to spend to preserve the current system.
David Merritt, an executive vice president of America’s Health Insurance Plans, a lobbying group for health insurers, condemned Medicare-for-all saying:
“Whether it’s called single-payer or Medicare-for-all, government-controlled health care cannot work. It will eliminate choice, undermine quality, put a chill on medical innovation and place an even heavier burden on hard-working taxpayers.”[iv]
In this one short statement David Merritt uttered six lies.
- “government controlled health care” – Medicare is not government controlled healthcare. Medicare pays medical bills instead of using health insurance. Medicare does not change the way doctors and hospitals provide health care. Medicare cannot tell any doctor how to do his or her job.
- “cannot work” – Since 1965 Medicare has paid the medical bills of Americans 65 and older; it works better than private insurance, costs less, and generates far fewer complaints. 55 Million Americans are using Medicare right now.
- “eliminate choice” – Medicare enrollees can use almost any doctor or hospital in America. It is private insurance plans that restrict choice with their hundreds of provider networks that limit which doctors and hospitals you can use. Have you ever asked the doctors office, “Do you take my insurance?”
- “undermine quality” – Again, Medicare in no way changes the way doctors and hospitals perform medical care.
- “chill on medical innovation” – Again, Medicare in no way changes the way doctors and hospitals perform medical care. Innovation comes from discoveries made by researcher scientists who work for universities and pharmaceutical companies, not from insurance companies.
- “place an even heavier burden on hard-working taxpayers” – Medicare will cost less than private health insurance and it will eliminate the tricky games that health insurance companies use to deny claims and force Americans to pay the medical bills. Getting insurance companies out of the healthcare business will reduce the complication and stress of getting healthcare in America.
MORE INSURANCE COMPANY LIES
Health insurance companies will continue to spread lies and propaganda to try to stop America from expanding Medicare. Here are some of the lies they have used in the past so that you will recognize them and understand what they really mean.
- “Government Healthcare Takeover”
Health insurers and their toadies use this term to try to make people think that Medicare-for-all means that they will have to go to some dreary understaffed government office on the other side of town and wait in line to see a slow-moving government doctor. It is a complete lie. Medicare-for-all would not make any change to how doctors and hospitals work in America.
- “Socialized Medicine”
Again, Medicare-for-all would not change in any way how doctors and hospitals provide healthcare in America. Medicare-for-all is a system to pay medical bills for Americans without the deception, swindling, denied claims, network tricks, pre-authorization requirements, and all the other schemes health insurers impose on Americans in their quest to squeeze billions of dollars of profits out of the healthcare business.
Government programs that make America a good place to live are not socialism. Is the Sheriff’s department “socialist law enforcement”? Are government built roads “socialist streets and highways”? Are elementary schools “socialist education”? No, of course not, and Medicare is not Socialized Medicine. Your grandma on Medicare is not a commie.
- “Medicare-for-all will take away your freedom to choose your doctors”
This is just another insurance company lie. Health insurance companies restrict the doctors and hospitals that their customers can use with the provider network restrictions. Medicare is accepted by most doctors and hospital in America.
- “You must wait 122 days to see a doctor to see if you have cancer!”
Give me a break. This is a total lie. Medicare enrollees can make an appointment and see a doctor just as quickly as anyone else in America. There are 55 million Americans currently enrolled in Medicare; do you think they would quietly put up with 122 day delays to see their doctor?
- “Medicare is going broke!”
This is another lie usually told with a long b.s. story about a Medicare Trust Fund that is being depleted day by day and will leave millions of sick elderly Americans crawling around in the street begging for aspirins and band aids. Medicare is paid for with a payroll tax that is 1.45% on employees and another 1.45% on employers, plus the premiums, deductible and copayments that enrollees pay. There is a Medicare trust fund but it is not going broke. Every month money goes in and out of it. Obviously any Medicare expansion would require agreement on new sources of funding. But overall, Medicare will be cheaper than health insurance without all the billions of dollars of profits, income taxes, and executives salaries.
- “We will have healthcare rationing and death panels!”
Just another lie to scare people. Medicare has been in effect since 1965 covering only the elderly and there is no rationing and no death panels. Why would these things be added to Medicare just because we let younger, healthier people join in?
- “Canadians have to wait for years to get bypass surgery.”
Please cite your source. Canadians are happy with their national healthcare system. Canada does prioritize care and critical patients receive treatment promptly. Anyway, we are not proposing to adopt the Canadian system. Medicare-for-all means letting all Americans use the same medical payment system your parents, grandparents and great-grandparents enjoyed in their golden years.
The best standard response to such claims of doom and gloom is “How do you know?” and “Show me the proof.”
- “It Will Cost $32 Trillion Dollars”
Republicans claim that Medicare-for-all will require “$32 Trillion Dollars in New Government Spending.” This statement is based on a sentence in a study by the Urban Institute taken out of context. There are several lies in that tight little sound bite.
First, Medicare-for-all will be cheaper than what we are paying in health insurance premiums that it replaces by eliminating all of the insurance company profits and income taxes that are rolled into health insurance costs. The Urban Institute report also mentions the enormous savings that will result when Medicare replaces costly health insurance but you will have a hard time finding a Republican lawmaker who will acknowledge that part of the report.
Second, $32 trillion dollars is the estimated healthcare cost for all Americans for ten years based on a study by the Urban Institute; it is not an estimate of the net cost to taxpayers of expanding Medicare. The Urban Institute study states that there would be offsetting savings from eliminated insurance costs and eliminated state and local government expenditures. The Republicans make it sound like it will immediately cost $32 trillion dollars per year and they do not mention the offsets, a lie by omission of material information.
Third, $32 trillion dollars assumes that Medicare-for-all enrollees will not pay any premiums, deductibles, or copayments. All current Medicare enrollees pay for part of their health care costs through monthly premiums, and copayment and deductible amounts based on the care they receive . In all likelihood Medicare-for-all would require future enrollees to pay their fair share of the costs just like Medicare does now. The Urban Institute study mentions several different estimated costs that are lower than $32 trillion dollars.
We do need to take steps to rein in healthcare costs in America, like allowing Medicare to negotiate for lower drug prices and requiring all hospitals, doctors, and clinics to post their price list so patients can shop around. I would like to hear a Republican lawmaker endorse ways to reduce our healthcare costs in the name of fiscal conservatism.
WHAT EVERY AMERICAN SHOULD DO
- Contact Your U.S. Senators and Your Representative
Whenever the issue of health care is being discussed in the U.S. Congress every citizen should contact their representative and each senator once every week to tell them what you want. You can call their office, mail a letter, send an email, or fax a letter. I suggest you do all of these things.
You need to contact your representative and each of your senators regardless of their political party and whether you voted for them or not. There are Republicans and Democrats who are concerned about providing Americans with better access to affordable healthcare, and there are Republicans and Democrats who are bought off by the health insurance companies. The power of democracy is that American citizens can vote representatives and senators out and replace them.
Whenever you contact your representative or senators, start your conversation by saying “I am a registered voter and I vote in every election. I want you to…”
Every American has one Representative and two Senators in Congress. There is a Representative for every 500,000 citizens, and there are two Senators for every state.
The Representative is elected every two years so they are very sensitive to the opinions of the people in their district.
Senators are reelected every six years and they become most sensitive as their time to be reelected approaches.
You can find out the name and contact information for your U.S. Representative by going to Find Your U.S. Representative.
You can find out the name and contact information for your two U.S. senators by going to Find Your U.S. Senator.
Note that you also have representatives and senators that serve in your state legislature but they are not the involved in passing healthcare reform.
- Vote In Every Primary And General Election
If you want things to get better you must vote in every primary election as well as the general election. Here is why.
While insurance companies cannot vote, they are allowed to give unlimited amounts of money to U.S. lawmakers. This has allowed corporations to sponsor politicians in both parties who are dedicated to serving their interests instead of the voters’.
Because of the traditional low voter turnout in primary elections corporations have often been able to give so much money to corporate-friendly primary candidates in both parties to overwhelm all of the other candidates in the primary election with advertising and campaign activity. That way the only candidates that appear on the ballot in the general election are candidates that are friendly to corporations.
We must all vote in every primary election for the candidate that promises to support access to affordable healthcare for all Americans. I switch my party affiliation as needed so I can vote in the Republican or the Democratic primary to help the candidate I want to help.
- Register To Vote
Your voice only counts if you are registered to vote. It is easier than ever to register and you only need to register once (and update it when you move).
A long time ago when you registered to vote you would often be called to serve on a jury. That is not done anymore because it discouraged people from registering to vote.
If you are not registered to vote, get registered now, before the end of the next week.