With the midterm elections on the horizon, some gubernatorial and state congressional candidates are advocating Medicare-for-All, Vermont Independent Sen. Bernie Sander’s universal health care legislation. Even some candidates in traditionally red states are touting “free healthcare.”
But the candidates dance around Medicare-for-All’s two fatal flaws: its astronomical price tag and inevitable worsening of the doctor shortage.
Medicare-for-All claims to offer a public health insurance option for every American — rich or poor, old or young, disabled or able — and to eliminate private insurance. Medicare-for-All is a misnomer. Medicare was designed for post-retirement adults ages 65 and older, whose health care needs differ greatly from younger populations.
Medicare-for-All cannot simply expand the program from seniors only to cover everyone. Enrollees contribute into the Medicare Trust for their entire working lives and even so, their total contributions do not cover the cost of their care after age 65 years.
And the truth of the Trust is that payment for the medical needs of today’s seniors depends on the contributions of today’s 35-year-olds. Medicare resembles a Ponzi scheme more than a savings account. In fact, the CBO estimates that the Trust will be “broke” (insolvent) in 2026.
At that time, Medicare will be unable to pay for the medical care for 44 million currently enrolled 65-year-olds. Imagine the shortfall if 282 million Americans were also given Medicare benefits.
Medicare-for-All would be incredibly expensive. An analysis by Charles Blahous, Senior Research Strategist at George Mason University’s Mercatus Center, found that national M4A would add at least $32.6 trillion to the federal budget within the first ten years of implementation.
It would simultaneously cut payments to health care providers by 40 percent relative to private insurance rates. In other words, doctors would have a lot more patients waiting in line to see them and would be paid a lot less money to treat them.
Low payment rates already reduce access to care for patients on public health insurance. A 2018 Merritt Hawkins survey found that nearly one-third of American physicians do not accept new Medicaid patients. While acceptance rates vary by state, many physicians cannot afford to treat Medicaid patients at the rate the government pays them.
A 2016 survey by the Texas Medical Association found that only 47 percent of Texas physicians treat new Medicaid patients. A 2017 survey of Florida physicians reported an acceptance rate of only 62.2 percent.
Florida and Texas have not expanded Medicaid to low-income adults under the Affordable Care Act (ACA). The physicians in those states are not stretched as thin as the ones in states that did expand Medicaid, such as California.
Florida’s James Madison Institute projected the consequences of Medicare-for-All. It would cost Florida $163 billion — compare that to Florida’s current total state budget, which is $89 billion. To cover the additional costs, Florida would either have to increase its sales tax from 6 percent to 39 percent or implement an income tax set at 37 percent.
If Floridians want Medicare-for-All, they would have to choose between a 650 percent increase in their sales tax or the highest state income tax in the nation. AND, they would have to amend their state Constitution, which prohibits an income tax. To pour salt in the wound, fewer doctors would be available to provide care.
Whether the misnamed Medicare-for-All program is enacted at the state or federal level, the result will be disaster: dramatic increase in taxes, more “healthcare dollars” going to government instead of health services, and more people dying while waiting in line for medical care.
Conservatives must continue to be a voice of reason in this ill-informed debate and must fight for what every American needs: affordable, accessible and quality care. One thing is certain — we won’t get that with Medicare-for-All.
Dr. Deane Waldman, MD MBA, is the director at the Center for Health Care Policy at Texas Public Policy Foundation based in Austin, Texas. Jennifer Minjarez is a policy analyst at the Center.