- A new study published in the journal PLOS Medicine found that a single-payer healthcare system would save more money on U.S. healthcare costs over time than competing systems.
- Researchers looked at 22 economic analyses of national and state-level single-payer proposals made over the past 30 years.
- They found 19 of the 22 reviews predicted this kind of system would result in net healthcare cost savings in as soon as the first year of existence.
- The researchers also found that all of the examined single-payer proposals would save money by year 10.
Healthcare reform — and how best to approach it — has consistently been at the center of political discourse in the United States for the past half century.
From fights over scrapping, preserving, or building on the Affordable Care Act, or “Obamacare,” to discussions over instituting what is known as a “Medicare for All” single-payer system, every side of the political spectrum has been weighing in on how to tackle America’s healthcare system.
This is especially so now that we find ourselves in the midst of another contentious presidential election year.
A new study published in the journal PLOS Medicine looks at one approach, single-payer. The study finds that, if implemented, this system would save considerably more money on U.S. healthcare costs over time than competing systems.
In the paper, researchers looked at 22 economic analyses of national and state-level single-payer proposals made over the past 30 years.
The results? They found 19 of the 22 reviews predicted this kind of system would result in net healthcare cost savings in as soon as the first year of existence, coming to an average of 3.5 percent of total healthcare spending.
Beyond the short-term benefits, the researchers took a look at cost projections that were made in 10 of the proposals that looked as far ahead as 11 years in the future.
They found cost savings would continue to grow as time went on, given that short-term increases in healthcare use would level off and global budgets for these single-payer systems would clamp down on costs.
The researchers also found that all of the examined single-payer proposals would save money by year 10.
One of the study authors, Dr. James G. Kahn, MPH, a professor at the Institute for Health Policy Studies at University of California, San Francisco, said the research team was surprised by the similarity of total cost savings shared by all the different plans that were studied.
“We knew some of the analyses, but not the relatively large number and consistency,” Kahn told Healthline. “We were also surprised that who did or supported the studies made little difference.”
Lead author Christopher Cai, a third-year medical student at UCSF, agreed that this across-the-board consensus between the different proposals was most surprising about the findings.
He told Healthline that his team’s research echoed other recent studies. For instance, Cai cited a report published this month in the Annals of Internal MedicineTrusted Source that revealed the U.S. could potentially save $600 billion in administrative savings if it switched over to a single-payer model.
What does this mean for the average person? For many, the regularly divisive, negative political debates about healthcare reform can leave a headache.
Disinformation on social media, for instance, can cloud perceptions of what is even being discussed in the first place. Even without all of these distractions, it can be confusing given the wide diversity of plans and proposals that exist.
Generally, a single-payer system refers to an alternate healthcare model to the current one in the United States.
Taxes would cover health expenses for the whole population, according to an overview from the Journal of General Internal MedicineTrusted Source. The goal would be for a sole public health system, like that in Canada.
How would a single-payer system improve people’s day-to-day lives?
Kahn said the current system is ultimately unsustainable.
“Currently, people contribute to premiums, and then pay deductibles and copays. Plus, wage growth has stagnated in part because employers have had to pay more for health insurance,” he said.
“With single-payer, premiums, deductibles, and most or all copays go away. Wealthier families will see their taxes rise. But for almost all lower and middle income families, the net effect will be to lower costs,” Kahn explained.
He added that the families that would benefit the most from this kind of system would be those in low to middle income brackets.
This would especially be beneficial for people with family members who need regular treatment for a chronic condition like diabetes.
“As a country, we will pay less under single-payer, and the way this will be passed on to patients depends on the specifics of the bill. In general, Dr. Kahn is absolutely correct. Working class families are likely to see the largest benefit,” Cai said.
The need to achieve essential universal healthcare for all people has been a global goal.
The World Health OrganizationTrusted Source reports that at least half of the world’s population does not have “full coverage of essential health services.”
Additionally, 100 million people are thrown into extreme poverty — which comes out to $1.90 or less per day — as a result of having to redirect resources to cover their health costs.
More than 930 million people, or about 12 percent of the globe’s population, spends 10 percent or more of their household budgets on healthcare.
As part of its Sustainable Development Goals, United Nations has issued a goal of achieving universal health coverage around the world in just 10 years, by 2030.
With all of this in mind, the current reality of healthcare in the United States looks comparatively bleak.
The Commonwealth Fund reports the United States ranks last “on measures of quality, efficiency, access to care, equity, and the ability to lead long, healthy, and productive lives” compared to six other industrialized nations — Australia, Canada, Germany, the Netherlands, New Zealand and the United Kingdom.
This is despite the fact that the United States has the most expensive healthcare system.
Dr. Stephanie Woolhandler, MPH, a practicing primary care physician and professor of public health and health policy at Hunter College, said that it is “very clear” based on “mountains of evidence” that people who live in countries with some form of universal single-payer health system live longer, healthier lives.
“Canadians live two-and-a-half years longer than Americans,” Woolhandler told Healthline.
“This wasn’t true before they implemented a single-payer system. They are now way ahead of the United States. They are spending a lot less of their GDP (gross domestic product) on healthcare.”
Woolhandler is also a co-founder and board member of Physicians for a National Health Program, an organization of more than 20,000 member physicians who are advocating for a single-payer health program in the United States.
She stressed that, while the largely political obstacles blocking a single-payer system are great, there have been shifting headwinds nationally.
In fact, the American College of Physicians, the nation’s largest medical specialty society, recently issued their endorsement for a single-payer Medicare for All health plan.
The endorsement was significant in that it’s the second-largest physicians group in the country, behind only the American Medical Association (AMA).
“It really shows a sea change from when the medical profession would fairly uniformly stand in opposition to a Medicare for All-type reform,” Woolhandler added.
“It’s a major change to openness to Medicare for All and an important boost to the possibilities to this kind of reform.”
John McDonough, DrPH, MPA, a professor of public health practice in the Department of Health Policy & Management at the Harvard T.H. Chan School of Public Health and director of executive and continuing professional education, said that if a single-payer system was created, society would certainly “see major reductions in overall health system spending by drastically lowering the administrative and other overhead costs that add little or no value.”
McDonough, who previously worked on the development and passage of the Affordable Care Act as a senior advisor on National Health Reform to the U.S. Senate Committee on Health, Education, Labor, and Pensions, said the exact cost savings from a single-payer system would depend on a range of factors, “such as the agreed-upon rate of payment for medical care providers, especially hospitals, physicians, and nurses.”
He added that it also depends on whether a new system would require consumer payments.
“In terms of individuals, again, details matter greatly. Many consumers and patients would see gains in coverage and affordability, and others with generous coverage pre-single-payer could perceive themselves to be losers,” McDonough told Healthline.
Having been a part of the inception of “Obamacare,” McDonough said a new healthcare system would most likely come about in a climate where “many would perceive themselves as losers, correctly or incorrectly.”
He added, “Those who would believe they would lose, rightly or wrongly, usually would have the loudest voices among the public. We saw this all the way through the creation of the Affordable Care Act, which was far more incremental than a single-payer plan would be.”
McDonough explained that, in his view, it might be easier to establish a “public option,” a public plan that citizens would choose to buy into, but that would “not eliminate private health insurance” though “it could erode private insurance over time, which is why the insurance industry and many healthcare providers would fight it bitterly.”
Woolhandler said past squeamishness over enacting a single-payer system has led to damaging healthcare inequities and challenges that are framed as insurmountable, but that are actually achievable.
She said a lot of this framing certainly rests with the private health insurance and pharmaceutical industries and their political allies.
According to Woolhandler, the “massive industries” that “profit off a market-rate health system,” such as the private health insurance industry, generate animus toward anything close to single-payer reform.
“Other developed nations pay half as much on prescription drugs as the U.S. does,” she added.
“The pharmaceutical industry in the U.S. has long been opposed to single-payer and knows that there’ll be some constraints on their prices in a single-payer system.”
Given the roadblocks put in place by these companies, is single-payer achievable?
Woolhandler and McDonough said it goes back to politics and the role of the voter.
“I can’t see far into the future. In fact, I can’t see beyond next November at this point. If in the elections, Democrats hold the House of Representatives and retake control of the White House and the Senate, they will gain the Senate by a narrow margin. 60 votes would be necessary to win a Medicare for All model in the Senate, and no Republican will vote for such a plan,” McDonough said.
“So the likelihood of this happening in 2021 is close to zero,” he added.
“One thing about which you can be sure — no such plan would ever pass with Republicans in charge of the White House, the Senate, or the House of Reps. When we will again see unitary Democratic control, then there’s a fighting chance, though not unless Dems hold at least 60 Senate seats.”
Woolhandler strikes a more optimistic tone. She said the only way for single-payer to be a reality would be for a “political movement through the electoral process.”
“It all comes down to, ‘Do we have a democracy in this country?’ which I’m still hopeful in,” Woolhandler said.
“Surveys show 70-plus percent of people want a Medicare for All system. It’s possible. Regardless, it will be a major issue in the upcoming presidential election. It’s certainly a key issue in the Democratic primary right now.”
