Abstract:
Universal health care has become quite the debate in recent years in the United States, as many countries around the world have adopted somewhat of a single-payer health care system. Even after the enactment of the Affordable Care Act in 2010, millions of American citizens remain uninsured and are unable to afford health care. This paper aims to highlight the current reasons as to why health care is so expensive in the United States and evaluates the proposal for a universal health care system. The proposal for “Medicare for All” is analyzed by using the Karger Model. Although it seems like a great idea to ensure all United States citizens are able to afford and seek health care services, it may not be a plausible program due to the current status of the system. Large health care conglomerates and pharmaceutical companies run the current health care structure, driving up prices that are out of proportion compared to other countries around the world. Implementation of a universal health care system would decrease the number of uninsured Americans and make health care including physical therapy services more accessible to all, but would also increase federal spending in a country that already spends millions of more dollars in comparison to other developed countries around the world.
Introduction:
Universal health care systems are widely accepted among developed countries, but the United States remains as one of the only countries that does not provide health care coverage to all of its residents. The Affordable Care Act (ACA) helped insure over 17 million Americans and was a critical step toward a universal healthcare system in the United States (Friends of BS). Since the implementation of the act in 2010, many of Americans still remain without health insurance and are unable to afford the high costs of healthcare services or insurance premiums provided by private insurance companies (Friends of BS). The United States spends more on health care per person than any other country in the world, averaging about $10,000 per person per year (Friends of BS, Sanders.gov). Spending in the United States on health care totals to over $3 trillion per year and accounts for 18% of the gross domestic product (GDP) (Sanders.gov). To put this into perspective, Canadian citizens typically see more doctors per year, and the country spends 50% less per person on health care as compared to the United States (Longman). The typical German citizen sees a doctor on average nine times a year, while the average American sees a doctor four times in a year, and Germany continues to spend less on health care (Longman). Despite the tremendous amount the United States spends on healthcare, the World Health Organization ranks the country 37th out of 191 countries based on overall health outcomes (Tandon A-WHO).
Many developed countries throughout the world have adopted a universal healthcare system, otherwise known as a single-payer system, thus providing coverage for all citizens. A pure single-payer system involves one payer, the government, which provides coverage to all citizens without the need for private insurance (Soffen K). A study performed by the PEW Research Center determined that over half of Americans believe the government should be responsible for healthcare coverage (Blake A). Senator Bernie Sanders recently proposed an adoption of a universal health care system for the United States, “Medicare for All”. It has seen much debate since its proposal at the beginning of this year. The basis of the plan is to expand Medicare coverage and eliminate all financial barriers to health care including private insurance, copays, deductibles and insurance premiums (Kurtzleben D, pnhp.org).
Debate Background:
“Medicare for All” is essentially a comprehensive health care coverage plan, meaning that every United States citizen would be covered by a single insurance program run by the government (Holhan J, Friends of BS). The goal of the program is to eliminate all cost sharing and private insurance companies in addition to including coverage for everything from inpatient and outpatient care to vision and dental services (Holhan J, HR676). The only eligible programs able to participate in the delivery of health care services under the program are non-profit and public health care institutions (Thomas.gov). The proposed bill would be integrated over a period of four years, beginning with the age of eligibility for Medicare decreasing to age 55 in year one (Kurtzleben D). This would then be followed by a progressive decline in the age of eligibility for Medicare services and ultimately end in universal coverage by the end of the four-year period (Kurtzleben D). The program is funded by several different sources including the use of previous government revenues for health care and tax increases (Thomas.gov). “Medicare for All” offers a plan to provide retraining and job relocation for those who may lose their job in the process of transition and include a board that will keep tabs on quality, access, and affordability of healthcare (Thomas.gov). The bill has been introduced to the House of Representatives but has been at a standstill with much debate since February of 2017 (Thomas.gov).
Since the proposal of “Medicare for All”, much debate has risen about its affordability and plausibility in the United States. One of the major debates about health care in America is whether or not it is a right or a privilege. This bill directly challenges the notion of health care as a privilege to American citizens. “Medicare for All” promises free healthcare for every United States citizen, but this does not necessarily mean that it is free (HRF). Americans will be paying more taxes in order to support such a costly program and will be paying for everyone’s health care all of the time instead of just paying for the services they need individually (HRF). This piece of legislation has also been met with resistance regarding increases in patient load. With more accessible and affordable healthcare, many more Americans will be seeking care. This may lead to an accumulation of patients in waiting rooms that need to be seen and result in longer wait times for patients with possibly serious health conditions (HRF). Adding more patients into the equation may only exacerbate this issue.
Economic Implications and Funding:
The adoption of “Medicare for All” would cause massive increases in federal spending, but would also result in decreases in spending by employers and individuals that previously paid for private health insurance (Holhan J). The proposal would decrease insurance premiums and out-of-pocket expenses for the consumer (Holhan J). It has been predicted that federal government spending on health care will eventually decrease by $6 trillion, ultimately saving billions with the implementation of the program (Friends of BS). However, initial implementation of the plan would increase federal spending by $32 trillion by the year 2026, which is more than a 50% increase in all federal spending compared to the current system (Friends of BS, Sanders.gov Holhan J, Soffen K). This increase is so large because the federal government will be required to cover the costs of all current spending by state and local governments in addition to individual spending by employers and households (Holhan J). Furthermore, the plan would cover those previously uninsured and remove cost sharing, additionally increasing federal spending on health care (Holhan J). According to a study performed by the Urban Institute, a universal health care system in the United States would result in an increase in coverage by approximately 28 million Americans and would decrease the amount of elderly uninsured by almost 31 million by the year 2026 (Holhan J).
Historical Background:
In 2006, Massachusetts passed a health care bill with a goal of providing health care coverage expansion in the state (Kaiser Foundation). The Massachusetts Health Care Act succeeded in providing health care coverage for almost all residents in the state and provided better access to medical services (Kaiser Foundation). As a result of the Massachusetts Health Care Act, Medicaid was expanded to cover children and families with incomes up to 300% of the federal poverty line (Kaiser Foundation). A program known as Commonwealth Care provides insurance for these individuals and also provides care for individuals with incomes below 150% of the federal poverty line. The average monthly premiums for individuals using this program range from $39 to $116 (Kaiser Foundation). This is much less than the average annual premium in the United States as of 2017, totaling $18,764 (NCSL). The act also required all individuals of the state of Massachusetts to have health insurance with a consequence a fine if they did not follow the guideline (Kaiser Foundation). Under this act, employers were also required to provide insurance to their employees and share the expenses with their employees (Kaiser Foundation).
Following the implementation of the Massachusetts Health Care Act, there have been impressive gains in health care coverage in the state, especially among non-elderly adults (Kaiser Foundation). The state of Massachusetts has a health care coverage rate of 98%, including nearly all children and seniors (mass.gov). Employment-based insurance continues to be the most prominent source of health care coverage for residents of the state, but coverage has become more affordable with premiums dropping 20% in 2007 (Kaiser Foundation, 7, mass.gov). In addition, overall accessibility to care has improved because of the act (mass.gov). This health care reform provided the United States with a substantial model to create the Affordable Care Act four years following.
The Affordable Care Act (ACA) was the first step toward a universal health care system in the United States. The purpose of the ACA was to decrease the number of Americans without health insurance and make it more affordable to everyone (Rak S). The act advocated for health care as a right rather than a privilege and proposed that every American citizen should have the opportunity to have health insurance (Rak S). The Affordable Care Act allows dependent coverage for all children up to the age of 26, which is a major benefit for recent college graduates that are still searching for a job (Kominski GF, Rak S). The act also eliminated lifetime limits on insurance coverage and ensured that no company could deny an individual with a pre-existing condition (Rak S). Under the ACA, employers must provide health insurance coverage to their employees, thus providing individuals with more of an opportunity to shop for insurance (Rak S). Medicaid was expanded to cover children, parents and single adults that were not previously eligible for coverage (Rak S). Approximately 20 million Americans have gained health insurance coverage since the implementation of the ACA in 2010, but even with the expansion of Medicaid, many Americans still struggle to afford the care they need (Obamacare CNN).
Within the same year as the proposal for “Medicare for All”, the state of California recommended the implementation of the Healthy California Act. The goal of this program is to establish a single-payer comprehensive health care system for the entire state of California (Registered Nurse). The plan is designed to replace the Affordable Care Act and provide health insurance for all residents of California regardless of immigration status or the ability to pay (Luna). Coverage under this plan includes undocumented residents, seniors on Medicare and people that currently obtain health coverage through their employer (Murphy K). Coverage benefits include inpatient and outpatient care, dental and vision care, mental health services, and nursing home care (Murphy K, SB 562). Similar to “Medicare for All”, the proposal has a goal of completely eliminating copays and deductibles, and patients will be able to seek care from any physician they choose (Murphy K, SB 562). Under this plan, the state government of California will be able to negotiate prices for health care services and hospital stays (Luna).
According to the Healthy California Act, a Healthy California Board made up of nine appointed members would govern the program (SB 562). A committee constructed by the Secretary of California Health and Human Services will express concerns regarding the program with the board (SB 562). There are approximately 40 million residents in California and this bill does not specifically discuss how it will raise enough money to provide coverage for every resident (Luna). Recent research has calculated the costs to support this bill to be slightly over $300 billion, which is actually lower than the current amount spent on health care in the state of California (Luna). The bill was approved by the California Senate in June of 2017 but has been at a standstill since due to inadequate funding plans (Luna). Although these plans have made changes to the United States health care system, there are many problems that remain unresolved.
Problems that Necessitate the Policy:
As mentioned previously, an estimated 29 million Americans today still do not have health insurance or are under-insured, unable to afford medical care (Friends of BS). There are several different reasons as to why Americans today continue to remain uninsured. Some of these reasons include the high costs of insurance and little access to health care coverage (Kaiser Commission). Despite the advances made by the ACA, many Americans still remain ineligible for coverage (Kaiser Commission). The Affordable Care Act expanded Medicare to cover those who earn up to 138% of the federal poverty line, but many individuals have an income that is too high to be covered and is too low to afford private insurance (Obamacare CNN, Kaiser Commission). Approximately 2.5 million Americans suffer from this problem due to states that have yet to expand Medicaid (Kaiser Commission).
Of the many reasons Americans remain uninsured, the primary reason is the high cost of insurance premiums (Kaiser Commission). It ends up being a cheaper option to pay the fines for not having health insurance coverage. The overall costs of medical care services are extremely high in the United States and many of the conditions that doctors treat are preventable illnesses. Preventable illnesses make up about 90% of all health care costs in the United States and this percentage could decrease with increases in annual doctor visits and check-ups (HRF). Hospitals also charge exaggerated prices for their services, which continues to drive up the cost of health care in the United States (Longman). To put this into perspective, the average hospital stay in the United States is $18,000, as compared to the average stay of $6,200 in other developed countries (Kane). “Medicare for All” would allow the government to be able to better negotiate the prices of medical interventions with an eventual goal of decreasing these enormous amounts.
In addition to the high costs of general medical services in America, prescription drug prices have also been on the rise. According to a study published in the Journal of American Medicine, spending on prescription medications is higher in the United States per capita than any other country in the world (Bose, JAMA). The United States Department of Health and Human Services determined prescription drug spending in the country was $457 billion in 2015 (Bose, HHS). Over 70% of the spending on pharmaceuticals was used for retail drugs, with the other 30% spent on non-retail drugs (Bose, HHS). The prices for the most commonly prescribed medications in the United States are almost double the price of the same drugs in other developed countries (Longman). Moreover, non-generic prescription drug prices range from 35-55% more in the United States (HRF). There is currently nothing in the American health care system to help keep the costs of drug prices down, so pharmaceutical companies will charge what they believe is reasonable for a drug’s predicted demand (Bose).
Policy Description:
“Medicare for All” proposes a completely comprehensive universal health care coverage plan for the United States (HR676). It plans to cover health care services including primary care and prevention, dietary and nutritional treatments, inpatient and outpatient care, emergency care, prescription medications and medical equipment, long-term care and palliative care, mental health and substance abuse services, dental and vision services, chiropractic services, hearing services, and podiatric care (HR676). Families and individuals would receive a program card in the mail after filing an application and those under the age of eighteen would be automatically enrolled (HR676). The plan would completely eliminate copays, premiums, co-insurance and cost sharing (HR676). Only public or non-profit institutions are allowed to participate in providing health services to patients (HR676). Under the proposed plan, citizens would be free to choose their health care practitioner and where they receive medical services (HR676).
Congress will play a large role in the negotiation of the budget for the program, which will be determined based on several factors. These factors include past expenditures, projected changes in prices, wages and input, total costs, the provider’s max capacity to provide the best possible care, and proposed new programs (HR676). The budget for “Medicare for All” will be used for payment for services, budgets, capitation payments and general administration of the program (HR676). A director will provide regional offices with annual funding and those offices will pay each health care provider a monthly sum to cover all expenses to run the operation (HR676). Capital expenditures will be used for construction or renovation of medical facilities, as well as medical equipment purchases (HR676).
There have been several proposed methods to pay health care providers under this proposal. These suggested payment methods include fee-for-service and salaried positions (HR676). Billing for medical services would also change under this piece of legislation. Physicians would be required to send all bills to the regional director through a systematic and uniform electronic billing system (HR 676). “Medicare for All” will also allow for the government to negotiate fair prices for health services, equipment, and medications (Friends of BS).
The proposed plan will take into account the VA Health Programs and the Indian Health Service Program. The VA Health Program will remain independent for a ten-year period after the enactment of “Medicare for All” and after this period, Congress will determine whether or not it is to remain independent or combined into the program after re-evaluation (HR676). The Indian Health Service Program will also remain independent upon implementation of the program, but it will be integrated after a five-year period (HR676). When evaluating the effectiveness and plausibility of this program, it is important to take into consideration its economical, political and administrative feasibility.
Policy Analysis:
“Medicare for All” proposes a great way to ensure that all Americans have health insurance coverage and are able to seek the care that they need without worrying about affording it. By making healthcare more accessible and affordable, the policy would contribute to an overall better quality of life for all Americans and would hopefully close the gap between health care disparities in the United States. It has been established that people without insurance have less access to care and do not receive preventative care (Kaiser Commission).
The proposal for “Medicare for All” is greatly supported by the Democratic Party, with a belief that healthcare is a right for all people and not a privilege (Cassidy). Approximately 65% of Democratic voters are in support of the federal government paying for health care coverage for every American citizen (Struyk). In a survey performed by the Kaiser Commission, 53% of Americans responded that they were in favor of a single-payer system (Cassidy). The proposal for “Medicare for All” currently has ninety sponsors, consisting of many that have previously participated in health care reform in the United States (Registered Nurse). Until recently, many self-identified independents were not in support of the program (Cassidy). Currently, the bill sought after by those that are self-identified Republicans, with only a small percentage of the party supporting a single-payer health care system (Cassidy). The majority of the House is filled with Republican representatives, causing the bill to come to a standstill as the Republic party tried to overhaul the ACA (Struyk). In addition to these challenges, funding is another factor that must be considered when implementing a program of this degree in the United States.
Funding for this type of program in American has been of debate since the program was introduced at the beginning of this year. It has been proposed that there will be an established Medicare for All trust fund in addition to several other ways to help fund the universal system (HR676). A 7.5% payroll tax on employers and a 4% individual income tax have been suggested and calculated to total over $6 trillion over a period ten years (Kurtzleben D, Options to Finance). There has also been a suggested progressive income tax on wealthier Americans and corporations, in addition to a responsible estate tax, which would tax the estates of the wealthiest 0.2% of Americans that inherit over $3.5 million (Options to Finance). A wealth tax of 1% would be established among the top 0.1% of the wealthiest American households and is calculated to raise over $1.3 trillion in ten years (Options to Finance). Senator Bernie Sanders has suggested several other programs to support the funding of the program as well that deal with large corporations and financial institutions (Options to Finance).
Although there are several ways to fund this program, it still will not be enough to support a universal health care system. It is extremely expensive to fund a universal health care program in the United States, especially when the costs of health care are already so high (Soffen K). The Urban Institute concluded that the suggested plans would only raise $15.3 trillion between the years of 2017 to 2026 (Holhan J). This is $16.6 trillion less than what is needed to support the cost of the program, meaning that other programs will need to be in place to help fill the gap that solely increasing taxes won’t cover (Holhan J).
Several different administrative positions and supervisory personnel are needed to ensure that the plan is providing quality health care to American citizens. Some of these positions include a Director, appointed by the Secretary, and a Director of Quality Control (HR676). These individuals will be in charge of providing recommendations to the President, Congress, the Secretary and other program officials (HR676). The Director of Quality Control will also perform reviews each year and decide on the need for medically necessary services (HR676). A Secretary will be appointed to establish and maintain regional offices. The regional offices will consist of a Regional Director and a Deputy Director (HR676). The regional office duties include coordination of funds as well as billing and reimbursement on a statewide system (HR676). The State Director of the program will provide yearly state health care needs assessments (HR676). The State Director also plays a role in oversight of new medical facilities and purchases of new equipment (HR676). They are also involved in submitting budgets to the regional director and quality control (HR676).
Finally, a National Board of Universal Quality and Access, composed of fifteen members appointed by the President and Senate, will each be appointed for six-year terms (HR676). These people will be health care professionals, representatives of providers of care, health care advocacy groups, labor union representatives, or citizen-patient advocates (HR676). The role of the board is to address specific issues related to health care services and delivery (HR676). These issues include access to and overall quality of care, efficiency of the administration, budget analysis, reimbursement of health care providers, mental health and substance abuse services, and working conditions (HR676). The board will be required to meet at least two times a year and will advise both the Secretary and Director on a consistent basis (HR676).
There are many different components and individuals needed for this proposal to work and for a universal system to flow correctly. As one can see, the plan set in place in the proposal for “Medicare for All” seems as though it would provide the best trickle down system to address all concerns from quality assurance to reimbursement of health care providers. The implementation of a universal health care plan under this proposal requires the appointment of numerous individuals to run both at the local and federal level.
Implications for Practice as a Physical Therapist:
The policy does not specifically address rehabilitation coverage, although this is most likely covered by the inpatient and outpatient section of the bill. Physical therapy and rehabilitation is an important piece of the healing process and is important after injury or surgery to be able to return to full function. Similar to primary health care services, many individuals are unable to afford physical therapy services.
A major barrier to receiving physical therapy services is the copay that patients must pay. Even with health insurance coverage, physical therapy copays can exceed $60 per visit and prices are substantially higher for those that have no insurance whatsoever (APTA Copays). Copays are paid every visit to physical therapy and patients will receive treatment several times a week, resulting in high total cost for services (APTA Copays). Medicare only covers eighty percent of physical therapy services, leaving the rest to be paid by the consumer either out-of-pocket or through supplementary insurance (Medicare.gov).
Implementation of a universal healthcare system would allow for better access to physical therapy treatment and provide patients with more of an opportunity to seek care. Patients would no longer have to worry about affording copays each time they visit and would not have to worry about meeting their health insurance deductible in order for physical therapy to be covered. Physical therapy would become more affordable and accessible for all patients because of the provisions that would be made by “Medicare for All”.
Conclusions:
The implementation of a universal healthcare system in the United States is an admirable idea, but it may be extremely difficult to carry out in a country like the United States with its current political system and healthcare system (USA Today). At the present time, the United States has a very inefficient healthcare system, spending millions upon millions more than any other country in the world with no necessarily better health outcomes (US Today). The current system revolves highly around profit, money, and monopolies that control the health care delivery systems (USA Today, Longman). It is built to provide profits to insurance companies, the pharmaceutical industry, and medical equipment suppliers (USA Today). About twenty-one cents of every dollar spent on private health insurance in the United States goes to overhead and profit (USA Today). A universal healthcare system poses many challenges but also has plenty of benefits for citizens of America.
A universal healthcare system would greatly reduce the amount of Americans that are under-insured or uninsured completely. In a study performed by the Urban Institute, under this plan coverage would increase by an estimated 28.3 million people (Holhan J). The “Medicare for All” plan would also reduce the amount of out-of-pocket expenses by the consumer compared to the current healthcare system. Patients would no longer have to worry about what their insurance does not cover and would be able to receive all types of care needed. Patients also have the freedom to pick and choose what healthcare provider they would like to see and in what type of facility (HR676). This plan also shows potential for a better way to control the costs of healthcare services (Kurtzleben D). The current healthcare system in the United States is highly centered around profit, meaning that Americans are paying more for healthcare services. For example, a coronary artery bypass graft, a common surgery used in the United States for the prevention and treatment of heart attacks and arterial plaque build up, costs $34,358 in the United States versus $21,218 in Sweden (Kane). Higher prices for medical care is due to the higher salaries of physicians in the United States as well as the use of more expensive medical diagnostic procedures (Kane). The average orthopedic surgeon in America is paid nearly three times that of an equally-trained surgeon in France performing the same procedures (Longman). Although there are many positives to this program, it does not go without disadvantages including funding and the challenge of the current American health care system.
Implementation of this plan will cause Americans taxes to increase, actually exceeding what they are saving in out-of-pocket costs (Kurtzleben D). Even with the rise in the tax rate, there still may not be enough funding to fully support and cover the cost of a universal healthcare system (Kurtzleben D). This program may also place more stress on a system that is already struggling financially. Currently, Medicare reimbursement rates are notably lower than the fees charged for services, meaning that patients not on Medicare are paying for the costs that Medicare does not cover (Kocur R). Switching to a universal program will not allow for the shuffling of these costs to other patients.
There are many developed countries throughout the world that have adopted a universal healthcare system where the government pays for most of their residents health care, but not all of it (Soffen K). In many other countries around the world, there are options to buy supplemental insurance or private insurance to cover the costs that the universal system does not cover (Soffen K). Senator Bernie Sander’s proposal would eliminate secondary insurance completely by placing all costs in the hands of the federal government, which will cause a rise in federal spending on healthcare, increasing the amount $13.8 trillion per year (Friends of BS). Unfortunately, the increase in taxes proposed will not be enough to cover the cost of the plan (Holhan J). A universal healthcare plan seems like a great idea for the United States, with a goal of insuring every single citizen.
One of the major problems with healthcare in America is its affordability and the lack of access for those who are not supported by Medicaid or unable to afford private insurance. This poses a health disparity between the wealthy and the poor, as well as disparities in overall health care services. The proposal for “Medicare for All” would seemingly solve many of the issues experienced when it comes to health care disparities in America. Unfortunately, the plan does not seem to be a plausible one for the United States. The increases in taxes may be so high exceeding Americans previous out-of-pocket expenses. With more accessible care, more people will be seeking care, leading to an increase in patient load in already over-crowded emergency departments and health centers (Longman). Large pharmaceutical companies as well as health care monopolies control the health care system in the United States and would also have a huge impact on this type of program. Pharmaceutical companies even ensured that the Affordable Care Act contained language stating that the federal government could not pursue cost-benefit analysis of drugs and also persuaded Medicare against negotiating drug prices (Longman). The current health care system in the United States does not necessarily support the notion that all people are equal, regardless of race, income, or disability. “Medicare for All” in addition to the Affordable Care Act have both been attempts for the United States to seek out a universal healthcare system and change the notion that health care coverage is a privilege to health care coverage as a right for all citizens of the United States.