Some Comparisons between Medicare for All, Graham-Cassidy and Dave’s Plan

With Obamacare in it’s death throes, we’ll probably have to choose between three ways forward. We’ll try to help by comparing Sander’s Medicare for All, Graham-Cassidy and and our own Dave’s plan in 4 crucial areas:

  1. Universal Coverage and Care. Just as Medicare covers all seniors above 65, under “Medicare for All” everyone will have a medicare card.  Present your card to any provider accepting it and you get care.  Of course, even today many providers refuse to take Medicare clients or  limit them to a certain percentage of their business. Medical practices simply determine how many loss leader medicare and  medicaid patients can mixed with higher reimbursement patients and still survive. The low reimbursement Medicare and Medicaid rates simply can’t be sustained on their own. In a sense they’re being subsidized by people paying higher rates for the same services  Under “medicare for all” this propping up would no longer be available as everyone would have medicare.  No higher payers available. Unless reimbursement rates go much higher, few providers would be around to actually provide care. Coverage doesn’t equal care. Graham-Cassidy doesn’t even pretend to provide Universal Care.  If fact, it does away with the individual and business mandates which might mean even less people have health insurance than under the Affordable Care Act (ACA).  Dave’s Plan on the other hand provides real Universal Care. Because providers would know every single person has a medical credit card and a catastrophic insurance policy tied to their Personal Benefits Account (PBA) there is no question of turning people away as unprofitable.  In fact, providers would have no way of knowing whether the Government was subsidizing the care or not. Why would they even care?  Advantage to Dave’s Plan for providing real Universal Care.
  2. Cost.  Why we would want to add millions of people to a failing program we’ll never know.  Medicare’s main trust fund will run out in just 11 years just as it is. Extending it to everyone would prove to be even more costly and inefficient . As we stated above with everyone on the plan, cost shifting would disappear resulting in either higher costs or less available services. Also, with absence of any private marketplace to for comparison , all prices would have to be determined by elites from above.  In essence price controls would rule and this distorts and misdirects resources leading to an overabundance of services in some areas while having shortages in others. The marketplace directs resources and capital where needed and away from where it isn’t. The one word that defines health care in the government systems such as in United Kingdom, Canada or the VA is “WAIT.” Wait for a knee replacement, to see a specialist, get a heart valve and on down the line. Ultimately, elites negotiate among themselves to make decisions on everything pertaining to health care. Rule by the” best and the brightest.” always sounds great but in practice always proves vastly inferior to the marketplace. If this wasn’t true, the Soviet Union would’ve won the cold war rather than going bankrupt. What really happens are constant cries for more resources and a fight over whatever is provided by all the vested interests. What isn’t apparent in any of these single payer plans is any  area of real cost savings, just the possibility of dictated lower prices resulting in rationing.  Graham-Cassidy uses the same resources the Affordable Care Act (ACA) uses for subsidies and medicaid expansion and gives them to the states in block grants to workout the best way to provide health care at the state level.. Because we don’t know what the individual states will do, it is impossible to make any judgment on costs. In the past, states have come up with innovations that were so good they were widely adopted. For example welfare reform in the nineties incubated at the state level. As  U.S. Supreme Court Justice Louis Brandeis wrote, the states were”The Laboratories of Democracy.” We would just have to wait and see how they handle costs.  Dave’s Plan unlike the others offers identifiable cost savings right off the bat.. Similar to Graham-Cassidy, the Plan  takes the resources the ACA allocates to subsidies and medicaid expansion , but rather than giving them to the states, it shepherds them to individual PBAs. What were employer plan resources would follow the same route. Starting with the Catastrophic Insurance policies associated with each and every account, we show savings. By excluding pre-existing  conditions and handling those through subsidized pools that would disappear over time, we greatly reduce their cost. Add the ability to purchase across state lines and by groups and we lower costs further. Little thought of but a known cost to insurance companies is the lapse cost. That is when the policyholders stop paying the premiums before the insurer recovers the costs of putting them on the books. These would cease to exist as the first thing the PBA pays for is the Catastrophic Policy. You can change insurers annually but there can be no lapses. As the vast majority of transactions would be on a cash basis via the associated PBA credit card we eliminate most third party overhead. Some people have estimated this can run as high as 30%. People using their own money to choose providers and services would lead to competition and that lowers costs. While we can’t say how much would be saved with certainty,  nobody can say the plan won’t result in real tangible savings. 5,10, 20% or more we’ll leave those estimates to the Congressional Budget Office. We would love for them to compare plans. Innovation, which we will take up separately, would be given the widest latitude and will result in further cost savings. Because it offers costs savings you can actually visualize, advantage Dave’s plan.
  3. Mobility. You don’t hear this discussed much but the mobility of a population leads to higher wages and a better fairer allocation of labor between large and smaller businesses. How many people have passed up a job at a higher wage for fear of losing health care whether provided by your employer or medicaid. A young business with a good future paying a better wage may not even be considered if it entails even the possibility losing medical coverage. A big business can use its size to negotiate lower premiums or even self insure, giving them a big leg up on the little guys. Unique to the United States, the relic of World War II of tax favored employer provided health insurance also gives a leg up to government employment. However, even Warren Buffet has pointed out the ever rising costs have made this advantage less attractive. The charts below illustrate why employers may want out of the benefits business.  As we can see everyone is paying a lot more. While payday wages have either stagnated or grown slowly, the cost of employees due to health care has grown rapidly leading to less people covered. This is especially true for smaller firms. While not disturbing employer provided insurance, Graham-Cassidy’s  potential for big variations in health care between the various states could really be an impediment to mobility.  Say a medicaid recipient with a pre-existing condition covered in Ohio is offered a better job in Texas but that state may not cover in the same way. Would you take the risk? This bill then does nothing to enhance mobility and could actually retard it. Medicare for all would do away with employer provided insurance and the differences in state coverage so on the surface it greatly boosts mobility.  However, if you’re pleased with your present health care providers, will the same quality care be available in a new location. Even now some areas lack providers taking medicare and medicaid. This might be even worse for the reasons we stated above. Again will you take the chance? Even though Medicare for All appears to improve mobility it may not prove out in fact. Dave’s plan does away with all these concerns. It’s your insurance and wherever you go it goes. Your medical credit card and catastrophic policy makes you  welcome virtually everywhere and by everybody.  Further with any potential new employer you’re talking only dollars not benefits making it much easier to make a job comparisons. Dave’s Plan absolutely makes you more mobile, so again give it the advantage.

Employer Health Care001

4. Innovation. As we mentioned above, the huge open marketplace created by Dave’s     Plan would strongly favor lower costs but that may not be the most important thing to a lot people. Jimmy Kimmel tugged at our heart strings with his monologue about his newborn’s heart surgery. He expressed his gratitude the operation on the pre-existing heart condition was covered by his insurance, expressing hope other children with similar maladies would also be covered in the future. Both Medicare for all and Dave’s Plan would of course cover these situations.  However, there is something else at work here. Pediatric heart surgery generally requires among other things, a lung-heart machine, such as those  made by Transonic of Ithaca,NY  or Medtronic of Minneapolis, MN.  You know the makers of the type of medical devices especially taxed under the ACA. (As they say, you want less of something, tax it).  There was a time these didn’t even exist and they, of course, have been perfected for tiny hearts. Having coverage doesn’t mean much if we don’t have the means for success. Those means come from innovation.  Maybe Jimmy looked around the operating room and marveled at what it took to save his child. Maybe in the same pediatric ward there was a child not so fortunate. That child like so many needs innovations we just don’t have now.  Children whose future depends on medical progress to survive and have a quality of life are still out there. We must never forget the United States has always been in forefront of innovation to a far greater degree than those with single payer systems. By their own admission, they don’t see being on the cutting edge as their mission.  If the U.S. joins their ranks by adopting Medicare for all, where will our needed advances come from in the future? (We covered much of this in What Charlie Gard Tells Us about Us). Graham-Cassidy doesn’t disturb innovation and in fact does away with the ACA’s device tax. Market based Dave’s Plan by reducing  third party regulation and red tape, while providing a huge market should provide the best environment for innovation. With all the children and others awaiting prayed for progress, maybe Jimmy Kimmel could give a monologue on that. Advantage Dave’s Plan.

We have compared these programs in these four important areas from the angle of providing not just theoretical coverage but the best actual care.  There are even more advantages Dave’s Plan can bring to the table. Take a peek at A Party Platform?.  Enhancing the Prospects of every American is our goal and in the process we can contribute to the progress making the world a better place.

 

 

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