Larry Levitt astutely, as he usually does, encapsulates the core trade-offs of any and all versions of Medicare for All proposals:
Every health policy has trade-offs, and with Medicare for all, they’re big ones.
On the one hand: Universal coverage, reduced prices, no premiums, and lower out-of-pocket costs.
On the other hand: Higher taxes, more government control, and less revenue for providers.
— Larry Levitt (@larry_levitt) November 15, 2018
These are real trade-offs with some people being much better off, some people being about the same and some people people and groups being significantly worse off. The weighing of those trade-offs are value driven weights. Technocrats, like me, can inform you that the trade-off for X is 77 millibebes of pain to Group Z and 103 pleasure points to Group M but the decision that this is a good deal or a bad deal is not a technocratic question. It is a decision informed by evidence but weighed by values.
Just keep that in mind, please.
Baud
In terms of negative trade-offs, is there any study examining how the change in the payment structure would affect the supply and distribution of providers? I would probably support universal coverage regardless, but I haven’t seen much on that issue (other than GOP scare tactics involving waiting lines),
MattF
Millibebe. There’s some reference there to… something or other?
Fred Fnord
More government control (even including the ability to say ‘no’) sounds good to me. As does less revenue for providers. And I have always thought that people who make as much as I do deserve to pay more taxes. (Though the recent ‘tax cut’ actually raised mine, if not by terribly much.) So for me I’m seeing little if any downside.
daveNYC
More government control is only a unique downside for MFA if you think that insurance companies don’t already have that level of control over your care.
Tenar Arha
Have you wonks already looked at the combined path of Medicare Buy-In and perhaps a Medicaid based public option with better prescription coverages? Does it cushion the industries better, & allow a smoother transition to Medicare/Medicaid for all that way?
(IIRC I remember reading a discussion like that. But I honestly don’t remember all the conclusions).
Betsy
There are a lot of aspects of more government control, including quality reporting and regulations that increase cost.
But, one way Medicare and other payers try to control costs is through medical policies. We’ll pay for your varicose vein treatment if it’s xx symptomatic and you’ve tried yy conservative treatments. Having a single set of these would be helpful for practices, rather than each payer devleoping their own, similar but not identical policies.
Medicare also weighs in on medical necessity. This is a two edge sword. If my doctor tells me my kid needs a treatment, I think that is medically necessary. But, there are a lot of procedures and treatments done that have little value or do harm. Controlling those would cause an uproar (get your hands off my Medicare) and would decrease provider revenue. Personally, it’s a trade off I would be willing to make.
LaNonna
The universal coverage we get in Italy definitely has standards for treatment, i.e., for a knee replacement one must weigh less than 90 kg (women), 100 kg for men, as too heavy does not give a good result. There are formulae regarding transplants and other super high ticket items, as well as more palliative care at end of life and less extreme interventions at that point.
If one wants to jump the line, or work around the limits within the ASL system, you may pay for lots of private care, but again with limits for in-hospital procedures. And income taxes are higher here than the US, but peace of mind, longer higher quality of life, and no medical debt or bankruptcy is worth it.
Italians love to complain about wait times, but in urgent cases there is minimal or no waiting.. our friends here all agree that Italy should NOT go the way of the US for medical care, scandoloso is the word they use.
WereBear
I’ve been reading some articles about how the Internet has had an effect on medicine; and it’s not what one might think.
For instance, diabetes (which is rampant in my family) is transforming treatment to be better and cheaper. Despite such desperate pushback as a South African doctor being sued by nutritionists in that country, coupled with the increasing knowledge that the American Diabetes Association gets lots of money from processed food manufacturers. The standard of “carbs at every meal and insulin to cover” that has been pushed is expensive, and costs even more when then-inevitable complications require expensive treatment.
But equally radical has been the revelation that in the age of pushbutton knowledge, the average doctor got to their high perch by their memorization skills, not their healing ones. REAL doctors, like my GP who has announced his retirement, are not that common, We still need surgeons and specialists, of course, but with a good PA, I’ve gotten more actual listening and more help than the typical visit which is all about matching expensive drugs to symptoms and zero interest in what is actually making me sick, and doing something about it.
The earthquake is coming, and lots of buildings need to fall down. This is just one of them.
orchid moon
I have to admit that I am a bit confused by the tweet when it says with universal coverage there will be no premiums. I and my spouse are on Medicare, and there is a premium each month (taken out of SS payments) for medicare. Then, we both pay extra for donut hole coverage. The combined payments are way more than we paid through employer based insurance coverage. I guess it could be construed as a “tax” for our medicare benefit. It seems to be thought that medicare is free for all, and that is not true. So the tweet is misleading in my mind. Seems to me to be perpetuating that we “nearly deads” are freeloaders on the system.
Another Scott
@orchid moon: That struck me as well. Verbally making Medicare (and Medicaid) into some sort of free birthday present for seniors doesn’t help us figure out how to expand it to cover more people, more efficiently, and at lower costs.
Mayhew/Anderson is right that there will have to be losers if/when the system is changed to pay less. And the people excessively benefiting from the system as it is are the obvious, sensible ones to be paying more of the price. I’m reminded that, say, 100 years ago physicians were middle class people and Buicks were marketed as “the doctor’s car”. A guy I went to school with said that in Iran the top professions were architect and engineer – not physician and lawyer… Too many physicians in the US are paid far too much now, and their compensation is going to have to come down over time. Other countries don’t pay as much as we do – and it’s not all hospitals, medical test, and prescription drug prices that are taking all the money. Physicians are going to end up with more sensible middle-class incomes and lots and lots of them are going to scream bloody murder about it…
Cheers,
Scott.
David Anderson
@MattF: A Millibebe was a college friend’s favorite nonsense unit of measurement and it has always stuck in my head as chuckle-worthy.
MattF
@David Anderson: It isn’t nice to taunt a physicist with made-up units. Could leave a scar.
ProfDamatu
@Another Scott: I agree, with the proviso that if and when this happens, it will have to be coupled with a complete restructuring of how medical education is handled and financed. IMO, it’s just not reasonable to expect people to accept a middle class income (so, presumably, less than $100k in most places) if they’re finishing their training with six-figure educational debt. This is already the case for lots of people with PhDs, and they will *never* be able to finish paying off those loans, or really have a truly middle class lifestyle until, if they’re fortunate, the balance of the loans is forgiven after 20-25 years of massive payments. And nor do we want to produce a situation in which only the children of the wealthy are able to become doctors.
WereBear
Yes, and in the case of academia, it used to be the lack of income relative to the educational load was handled via tenure and excellent benefits.
Don’t get me wrong: I can be harsh and wrathful, but I know many excellent doctors who had the best motives for going into medicine. The present structure, they tell me, encourages the hedge fund brains and discourages them.
Another Scott
@ProfDamatu: I don’t have detailed numbers, but we all have heard stories of physicians pulling in millions, or multi-hundred thousands, a year. Average PhD salaries are around $100k – that’s what I imagine happening if/when physician salaries head back toward “middle-class” levels.
I suspect that there are lots and lots of GPs that make much less than $200k a year, and probably some that make less than $100k. But US physician salaries – on average – are way out of wack compared to other doctorates. (Lots of PhD scientists have to suffer under one or more “post-doc” positions before they can get a “real job” – kinda like residency, kinda not.) And way out of wack compared to other countries.
Yes, school is expensive and it’s a crime that governments have drastically cut their support for post-secondary education over the decades. But physicians get high salaries because they’re in a position to demand them – not because school is expensive. (See Dean Baker.)
It’s going to be a messy and painful transition for those who are in the training pipeline now, and for those who follow. I sympathize with them. But physician salaries have to come down or there’s little hope in getting medical costs under control.
My $0.02.
Cheers,
Scott.
patrick II
Higher taxes is the one presented as a terrible thing when talking about Medicare for all — but what should I care if I spend $700 a month paying more taxes, or $700 a month paying a private company for the same thing? But that presents the cost as equal, and it wouldn’t be. Medicare for all will be significantly cheaper if run properly in place of the byzantine complex of offerings we have now. Administrative costs will be lower at both ends. There will be money left over for supplemental insurance for those who feel government management is too onerous or limiting. The cost per person as demonstrated in numerous countries will be lower than the system we have now.
Better health, less cost — what’s not to like? Oh yeah, less profit.
ProfDamatu
@Another Scott: Not quite sure why you’re arguing with me – the first two words in my post were literally “I agree!” Believe me, as an academic I am more than aware of the economic realities in that field. I’d also like to point out that the average figure you cite – well, we all know that averages are a lot less useful than medians where there is skew, which is DEFINITELY the case in academia. In the social sciences and humanities, very very very few people make $100k or more, unless they’re also administrators; STEM, business, etc. are the ones that tend to make more. And of course, it’s also the social science and humanities folks who are much much much more likely to have the massive debt – lots more grant and other funding is available for grad students in sciences than in soc sci and humanities, making them more reliant on loans. Not sure what the parallel here would be with medicine, but averages may not be the best way to look at it.
Except, of course for the GPs, who are the ones most often struggling to pay back that educational debt; hence the difficulty in getting doctors to go that route rather than become specialists. I realize there are other factors influencing physician compensation, but my point is that if we cram down doctor salaries WITHOUT ceasing to force people to basically take out a mortgage to become doctors…many fewer people are likely to take that deal.
Another Scott
@ProfDamatu: I was addressing your “with the proviso”. ;-)
I whole-heartedly agree that it’s a complicated problem, that averages hide lots of complexity, that incentives are all out of wack especially for people who want doctorates in the social sciences, the liberal arts, etc. I just don’t think that the cost of medical school and post-school training is driving medical salaries all that much. The physicians making the boatloads of money have been out of med school for a very long time – I assume…
Anyway, I don’t mean to be picking on you. I think we agree more than we disagree. I just like elaborating on the nuances (in my head anyway).
Thanks.
Cheers,
Scott.
jl
I have to disagree a little. I think there is way too much emphasis in the US over financing of insurance and service provision.
There are countries with radically different approaches to financing, that look very similar compared to US (and of course better for population health and cheaper).
Universal coverage, mechanisms to prevent corporate monopoly price gouging, community rating based on age and maybe geography, and subsidies for kids, poor and for insurance pools that get unlucky far more important for outcome, uniform basic benefit package. All those are more important to get right for the market for real goods and services and structure of insurance market.
I wouldn’t go so far as to say financing as a detail, but in the US that aspect is discussed to the exclusion of everything else. That is OK for political organizing since the slogans are easy to understand, but it shouldn’t drive the whole debate.
jl
@jl: meant to type ‘than structure of insurance market’, not ‘and structure of insurance market’,
ProfDamatu
@Another Scott: And the point I was trying to make is that even if educational costs aren’t driving physician salaries to a large degree, giving the profession a big haircut will *still* be problematic in terms of recruitment into the field *if* we don’t also fix medical education costs. I mean, maybe I’m totally an outlier, but if I were a bright, motivated undergrad today, and someone told me that I could expect to start my medical career with $150,000+ in loans, but would likely never make more than, say, $150k, and that would be after practicing for a decade, I’d say thanks but no thanks – that’s just way too much risk.
I think that implicitly, this is the deal we’ve been making with doctors for a long time: first you do undergrad and med school, totaling eight years and costing somewhere north of $150,000 in most cases. Then you do your residency, making generally about $45-50k (so, barely enough to minimally service those loans, especially given where a lot of teaching hospitals are located) for another 4-6 years. By now, you’re in your early 30s and still in six-figure debt, so your starting salary is going to generally be over $100k, and go up from there. Plenty of takers for that deal! Again, it doesn’t matter that doctor training costs aren’t the main reason that salaries are so high in a macroeconomic sense; I think that those costs do matter when we’re talking about the decisions that individuals make. If we change the deal so that now those early-30s docs move into a first post-residency job that pays, say, $60k, and then goes up from there, but won’t ever reach the heights of today, I think that deal starts to look a lot less inviting. There are plenty of other jobs paying that amount that someone intelligent enough to get through med school can do that don’t involve the monetary and opportunity costs. Make it so that they’ll never, ever get out of debt, and we may have a problem.
But yeah, I think we agree more than we disagree. :-)
Ruckus
@orchid moon:
This.
People think Medicare is free. It is not
Most of us of Medicare age have been paying for it most if not all of our working lives. It was signed into law 53 yrs ago. I’ve been earning wages for 55 yrs so I got 2 yrs part time work without that tax.
StringOnAStick
We have a radiation oncologist friend in Canada; every 5 years he gets a 3 month sabbatical. Sure, his salary is less than it is here, but he also has regular hours and the ability to take a 3 month sabbatical. He went back to Canada after a few years practicing in CA because he could not handle knowing he had patients that had been turned away because they did not have adequate insurance.
A doctor friend here loves working for Kaiser because he has a uniform schedule, can take vacations easily and have his shifts (anesthesiologist) covered, etc. Where a lot of push back comes from doctors over their compensation is a bunch of things like “residency was absolute hell, therefore I deserve a high salary”, “I can never be away from the phone and am on call X number of times per month, I therefore deserve a high salary”, “taking more than a week of vacation is impossible with my number of patients, therefore I deserve a high salary”, etc. Their jobs have so much extra time imposition on their lives, so they want that high compensation. How about we make their working lives more humane by them having a job instead of a ball and chain they can’t escape? Make medical school less expensive, graduate more doctors, PA’s and NP’s, and see if we can turn being a doctor, PA, NP into a job that doesn’t eat your life and yet pays well enough.
I have a coworker who wants to try to get into PA school and the pre-reqs are daunting; she already has a 4 year degree in pre-dentistry and has looked at how much debt dental school will land her in and has said “no thanks”. PA school is incredibly competitive for admission due to scarcity; we need more PA and NP programs.
ProfDamatu
@Another Scott: Or, to further the analogy with academia, at the risk of undermining my point somewhat…
We used to make a similar deal with academics – you’ll be in school for a long time, your first “real” job won’t be til you’re in your 30s for most of you (i.e., huge opportunity cost), and school will be somewhat expensive (big monetary cost). You’ll never be rich, but you’ll get a very secure job with excellent benefits, paid enough to make you solidly middle to upper middle class – and you get to study something you love for the rest of your life!
Over the past few decades, that deal has changed. The length of training is still the same, but now it costs a hell of a lot more, and we’ve reduced the number of secure jobs (i.e., tenure-track jobs) exponentially, such that only a fairly small proportion of PhD holders can ever expect to land one. Instead, the majority end up piecing together adjunct gigs for a period of time – many years in some cases! – and a hell of a lot eventually have to give up and find something else to do, because the higher ed system overall has “decided” that on average, those who teach undergrads aren’t worth investing more than a minimal amount in (the “adjunctification” of the academy). Those who also have massive loans…it’s not a pretty picture. I would just hate to see doctors thrust into a similar situation.
ProfDamatu
@StringOnAStick: Excellent points! I hadn’t even thought about the extra time demands that doctors have, but that would make the deal even worse if we just crammed down their salaries and did nothing else.
jl
@StringOnAStick: @ProfDamatu: There is a salary split for physicians in US. Average for all is close to 200K, but primary & family care start at under 100K, and substantial part of the career nearer to 100K than 200K, while specialists earn far higher. Maybe reason AMA initiatives to get more docs into primary/family care haven’t worked well. Most high income countries have either lower payed specialists, or far lower proportion of physician workforce is specialist. Same split seen in pharmacy and nursing.
Loan pressure is big and growing among students recently, and seen across professions, like engineering.
And for many healthcare professionals, working conditions suck, pressure to work for corporate profits versus standard of care also a growing problem.
ProfDamatu
@jl: Wow, no wonder there’s a primary doctor shortage! I don’t see how you’d ever be able to retire your student loans on that! Agreed that the loan issue goes beyond just medicine; it’s been huge for post-BA people for decades, and for about the past 10 years has started to crush undergrad degree holders as well.
jl
@ProfDamatu: AMA has gone in two different directions at same time on the salary issue, and has not been able to solve the problem. Has allowed specialists to capture rule making, procedure codes and reimbursement rules that favor specialists, but realizes the dominance of very very highly paid specialists in US healthcare compared to pretty much other high income industrialized country is causing a problem, but so far has only been able to push through mild and ineffective initiatives to change situation. Doesn’t seem willing or able to do anything about the pay split problem.
Most countries with economies comparable to US start health professional education much sooner after HS degree. Typically don’t need a 4 year academic degree, some countries start in HS. Gets docs, pharmacists started earning full salary sooner, and easier to charge off more training costs to public dime (particularly countries that start professional training right out of HS, or for some countries during HS).
Also, IMHO, more health professional school rotations, much of residency in US is just forcing low wage labor out of students, new professionals, than training in US than other countries. This is what I gather from what docs and pharmacists tell me from other countries. And stories I hear from students of ever more abusive ‘training’ situations. I got a med student and pharm student doing rotations at a major (and hint for those with ears,greedy and very aggressive profit minded) pharmacy chain doing hospital discharge med planning. I see very little training, if they finish their daily work schedule early, they just have to sit there (actually, and unbelivabley, stand at computer terminals. They do nothing. They got the day’s work out of them, I guess too much trouble to find anything for them to do, either more work or some enrichment learning.
jl
@jl: After they told me that, I asked them, ‘It’s too much trouble for them to get you chairs after your done?, You can’t leave? Can’t you read or study something?’ They said that yes, apparently it is too much trouble, they can’t leave, and nope they can’t read, they stand at their computer terminals. Good that they are working together, so they can at least chit chat and not go stir crazy.
Way too much like hazing, and squeezing low cost labor from them than training, IMHO.
Bob Hertz
I have prepared a summary called “Eighteen Questions for Single Payer Advocates.”
One question is how to deal with at least three kinds of medical debt if we go to single payer:
1. medical education debt
2. patient debt
3. Hospital construction debt
As I despise debt based financing of public goods, I would use taxpayer funds to pay all these off.
You can get a copy of my essay by writing to me at [email protected]