Janet
Trautwein Published 10:45 p.m. ET Dec. 1, 2019
Most Americans like private health insurance.
That's the key finding of a recent Wall Street Journal/NBC News poll. Fifty-six
percent of voters oppose Medicare for All if it eliminates private coverage.
Many moderate lawmakers are well aware of
these polling figures. So they're calling for an expanded version of Medicare —
or the creation of a new government-run plan to compete against private
insurers.
All these approaches — whether Medicare for
All, Medicare for All Who Want It or a public option — would be
disastrous. Each would raise taxes, reduce the quality of care and eliminate
the private health coverage that most consumers have, like and expect to keep.
Let's start with Medicare for All. The general
concept — extending comprehensive, government-funded coverage to all
Americans — polls well. About half of Americans give it the thumbs-up,
according to the Kaiser Family Foundation.
That majority support turns to opposition once
people learn Medicare for All would ban private insurance. The plan grants the
federal government a monopoly on health insurance — no private insurers or
employers would be permitted to pay for health benefits.
People are big fans of private insurance.
Seven in 10 Americans say they're satisfied with the coverage they receive
through work. That's a lot of people — more than 180 million Americans
have employer-sponsored health insurance.
The "public option" aims to assuage
these folks' fears by allowing people who have employer-sponsored coverage to
keep it and giving those who don't an alternative. A government-sponsored
health plan that's open to everyone should also put pressure on private
insurers to keep prices as low as possible — at least, that's the
thinking.
But like Medicare for All, a public option
would lead to the destruction of the private insurance market. It'd just do so
more slowly.
The public option would have the power to tilt
the insurance market in its favor. Most public option proposals envision
reimbursing hospitals and doctors at Medicare's rates, which are artificially
low. In 2017, for every dollar hospitals spent caring for Medicare patients,
they received only 87 cents in reimbursement.
Those lower costs would allow the public
option to charge less than commercial insurers, which don't have the power to
underpay providers.
Many Americans would understandably switch
from private insurance to the public option. As they did so, hospitals and
doctors would raise prices for the privately insured to compensate. Insurers
would be forced to hike premiums in response, to cover providers' higher
payment demands. That would compel even more individuals to switch to the
public option.
Some employers would surely do the same,
dropping their benefits programs and encouraging their workers to enroll in the
public plan. Indeed, a recent study from KNG Health Consulting found that
Medicare for America — a proposal that would transfer everyone who does
not receive coverage through an employer to a government-run plan — would
cause one in four workers to lose access to employer-sponsored insurance by
2023. More than half of employees at small businesses would lose their
employer-sponsored coverage under Medicare for America.
Eventually, the public option would be the
only option. The insurance market can't function unless all the players in the
market are operating by the same rules.
As Seema Verma, administrator of the
Centers for Medicare & Medicaid Services, rightly put it, "The public
option is a Trojan horse" for Medicare for All.
Americans would suffer under a government-run
healthcare system. Approximately 5,000 community hospitals would lose over $151
billion under a Medicare for All system, according to a recent Stanford
University study. Robert Pollin — an economist at the University of
Massachusetts Amherst and supporter of Medicare for All — estimates that 2
million jobs across hospitals, health care facilities and the insurance
industry could disappear.
A report from the Congressional Budget Office
concluded that Medicare for All could "lead to a shortage of providers,
longer wait times and changes in the quality of care."
That's a lot of disruption to a health
insurance system that works well for most people. More than eight in
10 Americans with private coverage say they receive "good" or
"excellent" care, according to a Gallup poll. Nearly 92% of U.S.
residents have health insurance.
It'd be far simpler — and more popular
— to expand access to coverage through our existing private,
employer-driven system than to launch a government takeover of health
insurance.
Janet Trautwein is CEO of the National
Association of Health Underwriters.
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