How Could Medicare for All Work in California?
Q. How would Medicare for All California provide coverage to all Californians without increasing spending?
A. By correcting the current health care finance system which currently spends nearly 30% of each health care dollar on administrative and clinical waste, excess drug prices and fraud. Medicare for All California would streamline administration, use state purchasing power to negotiate discounts on the price of pharmaceuticals and medical equipment, create an agency to perform health planning, support the delivery of high quality care and establish an Inspector General for Health Care with strong investigative tools to uncover fraud.
Q. Why is there no new spending?
A. There is more than enough money now being spent on health care to finance benefit rich universal health coverage. We spend over $6,000 per capita, or more than twice the amount spent in other countries that insure everyone. By correcting health care misspending, a Medicare for All California system would be able to direct money into health care and make the health system very efficient.
Q. How would Medicare for All California control spending growth?
A. The foundation for controlling spending growth is the streamlined administration made possible by having a single insurer, use of purchasing power to lower prices, provision of universal health coverage so everyone gets preventive care, and consolidated budgetary authority with statutory spending limits. A Medicare for All California system would do all of this and add an array of other fiscal tools including capital health investment management, a health payment board to establish provider reimbursement, and a referral policy for specialty care. If necessary, Medicare for All California could give authority to impose limits on provider and manufacturer reimbursement, to increase premiums, delay the introduction of new benefits and delay capital investments.
Q. Can we afford this reform at a time when our elective officials say we can’t even afford to lower college costs?
A. California’s money problems are caused in part by our dysfunctional health finance system and health care misspending. We can’t afford NOT to do this and Medicare for All California would be a major step toward a more generous and balanced budget. The Lewin Group forecast that a single insurer model like Medicare for All California would save the state $44 billion dollars in the first ten years.
Q. Will people pay more?
A. Most would pay less for health care and insurance than they do now. And, once one’s health insurance premium is paid, there are no other costs, no co-pays, no deductibles.
Q. How many Californians have no health insurance?
A. Even after passage of the Affordable Care Act about 3.8 million Californians under the age of 65 still remain without without coverage in 2015. A disproportionate number of those without insurance are people of color and those with low income.
Q. Who doesn’t have health insurance?
A. More than 80% of Californians without health insurance are in families where there is at least one person working. A disproportionate number are from the black and Hispanic community. Many are low-wage workers, but many are also solidly middle class.
Q. I have insurance, so why should I want to change a system that is working for me?
A. The health care crisis affects all of us.In a recent poll (January, 2016), conducted by The New York Times and the Kaiser Family Foundation, roughly 20 percent of people under age 65 with health insurance nonetheless reported having problems paying their medical bills over the last year. By comparison, 53 percent of people without insurance said the same. These financial vulnerabilities reflect the high costs of health care in the United States, the most expensive place in the world to get sick. They also highlight a substantial shift in the nature of health insurance. Since the late 1990s, insurance plans have begun asking their customers to pay an increasingly greater share of their bills out of pocket through rising deductibles and co-payments. The Affordable Care Act, signed by President Obama in 2010, protected many Americans from very high health costs by requiring insurance plans to be more comprehensive, but at the same time it allowed or even encouraged increases in deductibles.
The Institute of Medicine, the government health advisor, says we are suffering from an “epidemic of sub-standard care”. The price of health insurance is rising many times faster than wages, as much as 59% over the last 5 years. Employment is adversely affected because employers avoid hiring full time employees to avoid having to pay for expensive insurance for them. US products are becoming less competitive in global markets because of high employer health care costs. Emergency Rooms aren’t available when you need them because they’re filled with uninsured Californians who have no where else to get care. We all have a big stake in fixing the health care crisis.
Q. Why is it better to pay into a publicly administered health care system than to pay a private health insurance premium?
A. You would get a lot more health care from your contributions to a publicly financed system than from a private health insurance premium. When you pay a premium to an insurance company a large portion of it, 20% to 30%, goes to administration, shareholder dividends, executive reimbursement, marketing and to pay for additional administrative costs borne by doctors and hospitals. Only 70% to 80% is spent on health care. When you contribute to a state health fund, much more money goes to provide health care. It is a more efficient use of limited health care resources.
Q. Would Medicare for All California cover undocumented immigrants?
A. Yes. It costs California less to insure undocumented immigrants than to exclude them. People without health insurance don’t get preventive care and, consequently, use expensive emergency rooms and hospital care when they get sick. It is estimated that if every Californian got preventive care we could save $3.4 billion dollars a year. Most undocumented Californians are employed in essential jobs and our immigrants pay $80,000 more in taxes and fees over a lifetime than they will receive in local, state and federal benefits in their lifetimes. And it’s good public health policy to insure the entire population. It helps control epidemics or outbreaks that could expose everyone to disease.
Q. What about waiting lists in Canada?
A. Canada spends about 1/3 as much as we do per capita on health care and uses waiting lists to manage limited resources. California spends more than enough to avoid waiting lists, although we will have to plan our resource use carefully.
Q. Does this reform ration health care?
A. Under Medicare for All California, care would be affordable for every Californian, and health system planning would be done by a public, representative Health Policy Board. Care would only be “rationed” in the sense that the care you get would be based on the sound medical judgement of your doctor. All health care systems now ration care and consider it to be sensible health care planning. The question is on what basis is care rationed and who makes the decisions? Today, insurance and pharmaceutical companies and HMOs ration care and medications to those who can afford them.
Q. Is this socialized medicine?
A. This is definitely not socialized medicine, where the government owns all the health care facilities and trains and employs the health care workforce. This would bd a private health care system that is publicly administered and financed.
Q. Is this government-run health care?
A. No. A publicly administered finance system would put medical decision making back in the hands of medical professionals and their patients, unlike today when doctors have to get permission to order a test or a treatment from an insurance administrator with little or no medical training. A Medicare for All California system would include provisions to protect the health care system from some of the problems that governments face. Strong conflict of interest rules, prohibitions on partisan activity and connections to for-profit insurance and pharmaceutical companies have been incorporated. Health system officers would be protected from special interests and the entire health care system would be exempt from oversight by other government agencies that might slow things down and make bureaucracies unresponsive. What makes a government program unpopular is inadequate funding, complex eligibility rules, means testing, periodic eligibility lapses, poor provider participation, low provider reimbursement and the stigma of being “on welfare.” A publicly administered consolidated insurance system would not have these problems.
Q. Wouldn’t the Commissioner be a “czar” with too much power?
A. No. The Commissioner would be elected. This would provide a measure of accountability and the leadership system would have checks and balances. The Commissioner would be the chief administrative officer. A physician would be the Chief Medical Officer. The Consumer Advocate would represent consumer interests. All meetings would be open. All documents, except privacy-protected documents, would be public. All system officers could be impeached for malfeasance of office.
Q. Is a full pharmaceutical benefit without a co-pay affordable?
A. No. There are 10 million Californians who now have no prescription drug benefits but who would have them under Medicare for All California. This expansion of the market would offset losses from lower prices.
Q. Will lower drug prices hurt the ability of pharmaceutical companies to do research?
A. No. Pharmaceutical companies don’t use profits to pay for research, so even if their profits were to drop from lower drug prices, it wouldn’t affect research.
Q. How would the plan help seniors who already have health coverage through Medicare?
A. With Medicare for All California, seniors would get benefits that are not even included in Medicare, such as full prescription drug coverage and dental coverage. For at least the first two years there would be no co-payments or deductibles for ANY services. Seniors would spend less than they do now for health care.
Q. Would anyone lose benefits they now have?
A. The intent is that no one should lose any benefit they now have.
Q. Who would decide what the medical benefits would be?
A.The Chief Medical Officer and other physicians would recommend the benefits they think are appropriate. The Commissioner and the Health Policy Board would vote on whether to accept their recommendation.
Q. Would Kaiser continue to exist under Medicare for All California?
A. Kaiser would provide health services just as it does today but it would no longer sell insurance policies. All licensed, accredited providers would still exist and could be chosen by patients through the system.
Q. Would a Medicare for All California system stifle innovation?
A. Medicare for All California would, in fact, stimulate innovation in several ways. Medicare for All California would expand health markets, freeing up private dollars that now pay for care for the uninsured and creating a well-funded state budget for Research and Development. Partnerships for Health could provide health care grants to communities for innovative programs. Pharmaceutical companies would have the incentive to redirect the 40% of their research budget now spent on “copy cat” drugs and instead invest it in much needed research on treatments for diseases such as multiple sclerosis and breast cancer .
Q. How would your system decrease medical errors?
A. By eliminating many of the causes of errors such as understaffing, lack of readily accessible medical information, and lack of coordination of medical services. Your chosen primary care provider would be responsible for coordinating the care you need.
Q. How would Medicare for All California address the nursing shortage?
A. No one can solve the nursing shortage overnight. But a well-managed single insurer system would have funds to invest in nursing education, the shortage of which is at the heart of the problem.
Q. Could the Commissioner close a hospital over the objections of the community?
A. No. A hospital would only be closed if providers and patients chose not to use it or if the hospital fails to be accredited under California law. The Commissioner could only hold back funds if a hospital failed to meet quality of care standards.