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“Medicare for All” could be Costly and Disruptive: CBO

A report from the nonpartisan Congressional Budget Office was a high-level look at the pros and cons of changing the current mix of public and private health care financing to a system paid for entirely by the government. It did not include cost estimates of Sen. Bernie Sanders’ Medicare for All legislation or its House counterpart, but raised dozens of issues lawmakers would confront.

“The transition toward a single-payer system could be complicated, challenging and potentially disruptive,” the report said. “Policymakers would need to consider how quickly people with private insurance would switch their coverage to a new public plan, what would happen to workers in the health insurance industry if private insurance was banned or its role was limited, and how quickly provider payment rates under the single-payer system would be phased in from current levels.”

Employers now cover more than 160 million people, roughly half the U.S. population. Medicare covers seniors and disabled people. Medicaid covers low-income people and many nursing home residents. Other government programs serve children or military veterans.

Potentially difficult choices flagged in the report included:

  • Coverage for people living in the country without legal permission, which CBO called “a key design issue.” Sanders’ bill and its House counterpart would cover all U.S. residents, leaving it to a future administration to define that term.
  • Payment for long-term care services, which CBO said could substantially increase government costs. Sanders and House counterparts would cover long-term care.
  • Use of a government-set “global budget” to control cost, a strategy CBO said is “barely used” in the U.S. Programs like Medicare and Medicaid rely on other approaches.
  • Private payments from employers and individuals currently cover close to half of the nation’s annual $3.5 trillion health care bill. A government-run system would entail new taxes, including income taxes, payroll taxes, or consumption taxes, said CBO. Or lawmakers could borrow, adding to the overhang of national debt.

Read more in Insurance Journal

“The conversation about single-payer is getting more in the weeds, more detailed, which is a good thing because it’s such a complicated issue,” said Jodi Liu, an associate policy researcher at the Rand Corp. who studies single-payer proposals.

The takeaway: There’s a lot left to be answered about the concepts of Medicare-for-all specifically and the more broad category of single-payer before policymakers and voters can come close to understanding what it would mean in practice. The term “single-payer” generally refers to a system in which health care is paid for by a single public authority.

“Even single-payer systems around the globe vary from each other in many, many ways,” said John McDonough, a Harvard health policy professor who helped draft the Affordable Care Act. “There’s just so many aspects of it that differ from a Canada to a Sweden to a Taiwan — and those are all intensely consequential.”

Read more in Kaiser Health News

Read the 29 page Congressional Budget Office report

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Contact Alexis Hertel at  

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