Should ‘Medicare for All’ Be Mandatory? Democrats Spar On Stage

(Bloomberg) -- The candidates running for the Democratic presidential nomination rallied around the idea of a government-run Medicare option Thursday night, disagreeing only over whether to make it an option or put all Americans in the program.

A government-run insurance option was considered and rejected during the party’s legislating of the Affordable Care Act. A decade later, the support for making Medicare available to more people, either to compete with private insurance or replace it entirely, is a sign of how far the Democratic party has shifted -- even in the face of inevitable Republican attacks during the general election.

There are still significant differences among the candidates. Progressive members of the caucus including Senator Bernie Sanders, Senator Elizabeth Warren and Senator Kamala Harris have said they would eliminate private insurance entirely. Others, including former Vice President Joe Biden, have endorsed the idea of making a Medicare-like option available to compete against private coverage.

The party’s embrace of some form of government-run insurance will certainly be a line of attack for Republicans during the general election. Immediately after the debate, President Donald Trump’s campaign issued a statement attacking Democrats. “All of the Democrats tripped over each other in a race to see who could stand out as the most leftist candidate, threatening government control of every aspect of people’s lives,” said campaign spokeswoman Kayleigh McEnany.

Health-care is a top issue for voters, and Medicare for All enjoys broad support: 56% of Americans supported the plan in a January survey by the Kaiser Family Foundation, a health research group. Backing for the idea gets softer as people hear about potential pitfalls. When told Medicare for All would eliminate private health insurance, 37% said they favor it while 58% said they oppose the idea.

Sanders’s Proposal

Sanders has introduced a Medicare for All plan that would largely eliminate private insurance in four years. Under the program, Americans would not incur any out-of-pocket costs except for small copays for drugs. It would also cost hundreds of billions of dollars in additional spending. Sanders said Thursday at the debate that many Americans “will pay more in taxes, but less for health care.”

A 2019 estimate by the Rand Corp., a nonprofit research group, estimated that one version of Medicare for All would more than triple federal spending to $3.499 trillion in 2019, close to the same amount spent on health care in the U.S.

Senator Kirsten Gillibrand, who co-sponsored Sanders’s bill, said that creating a Medicare option would eventually lead to single-payer health care anyways. The quickest way to get to universal coverage “is you create competition with the insurers,” she said. “People will choose Medicare, you will transition, we’ll get to Medicare for All.”

In comments Friday to MSNBC, Harris said she didn’t actually want to eliminate private insurance entirely, and supports letting insurers selling supplemental coverage that would add to a Medicare-like option.

“I am a proponent of Medicare for all. Private insurance will exist for supplemental coverage,” Harris said Friday.

That would still amount to a massive restriction on the health insurance industry. Key benefits like hospital and doctor coverage are the majority of value in an insurance benefit, and curtailing companies to offering supplemental coverage would be a substantial change.

Those on the more moderate end of the party have advocated keeping a role for private health insurance, which covers more than half of Americans. The Affordable Care Act expanded health-care to about 20 million people, about a third of whom got coverage through government-subsidized private plans.

Making a government-run option available in those Affordable Care Act marketplaces will lead to “a very natural glide path” to universal coverage, South Bend, Indiana Mayor Pete Buttigieg said. He called his idea “Medicare for all who want it.”

If one of the candidates were to defeat Trump and actually attempt to implement a Medicare expansion, the decisions about how broadly to expand Medicare would have major implications for the functioning of health insurance markets. Some fret that a public option would attract the sickest and neediest people and thereby drive up costs.

©2019 Bloomberg L.P.

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