A recent study concluded that having the United States convert to a single-payer national health insurance system would result in a net increase in cost of $63 billion — or about six times less than what the federal government is spending on the bank bailout. Moreover, the switch would have a significant stimulus effect by creating millions of decent-paying jobs and pumping more revenue into the economy.
The study was conducted by the Institute for Health and Socio-Economic Policy, a non-profit research group for the National Nurses Organizing Committee.
Single-payer national health insurance involves a system in which one governmental agency controls healthcare financing and negotiates prices but the actual delivery of services remains handled by private providers. In essence, each person would pay a standardized tax or fee of some sort to the government, which then would be responsible for paying providers.
What it’s not is “socialized medicine.” The government provides insurance, but people keep their choice of private physicians.
Currently the United States relies on a private health insurance system that’s largely employer-sponsored, one of the only industrialized democracies that still does so. Such a system has resulted in 46 million Americans being uninsured, a number that only will jump as mass layoffs continue in the dismal economic climate sparked by the banking system’s reckless behavior.
The private sector now shells out about $510 billion annually in insurance premiums, placing a huge burden on companies, according to the study. Switching to a single-payer system would result in injecting $317 billion in increased business and public revenues into the economy and create 2.6 million permanent jobs at an average of $38,262 per year.
Overall healthcare administrative costs also would be reduced by $56 million.
The study didn’t look at how the money for the new system would be generated.
Instead, it focused on how much the system would cost and what impact it would have on the overall economy.
One likely payment option is a Value-Added Tax that would add a small tax applied to each step in the production of goods and services. That’s how it’s done in other industrialized nations like Australia, Canada, India and those in the European Union.
For people who now are privately insured, a single-payer system would offer peace of mind and potentially lower individual costs. This would be done by replacing “the current chaos of eligibility, exclusions, family coverage, premium costs, high out-of-pocket expenses and vulnerability to losing employer-sponsored coverage with a standard level of coverage, unrelated to employment status or annual corporate insurance decisions,” the study concludes.
This isn’t pie-in-the-sky posturing.
President Obama recently unveiled a proposed budget that begins the process toward possibly implementing a single-payer system. Under his plan, the government would allocate $634 billion during the next decade into a new healthcare reserve fund while details of the new system are hammered out. Also, he wants to take another $175 billion that otherwise would go to insurance companies to cover people in private Medicare plans.
Obama has appointed a woman with Cincinnati roots to help get the job done, picking Kansas Gov. Kathleen Sebelius to be his Secretary of Health and Human Services. Sebelius (pictured) grew up here as the daughter of ex-Ohio. Gov. John Gilligan, a Clifton resident.
There’s no doubt that insurance companies and pharmaceutical manufacturers will fight any such changes because they profit greatly under the present system, but Obama and Congress need to stand their ground. Poll after poll has shown that Americans want changes that would make healthcare accessible and affordable for all.
One recent poll, by the Pew Research Center for the People and the Press, found that 63 percent of Americans favor a government guarantee of universal health insurance even if it means raising taxes; the number is even higher in other polls.
To be sure, some Republicans will bellow that any increase in health care costs should be avoided. They will say it places U.S. companies at a competitive disadvantage with foreign-based firms. Facts, though, don’t support that claim.
The study shows that the United States has historically subjected taxpayers, including corporations, to a considerably lower rate for social expenditures than other industrialized nations.
When total social expenditures — money spent on wages, day care, pensions, sick leave, maternity leave, job training and home help care — that those nations collect are viewed as a percentage of their Gross Domestic Product (GDP), the United States ranks far below most nations and well below the average.
The average spent is 20.71 percent of GDP, while the U.S. spends 16.20 percent. The highest percentage is spent by Sweden (31.28 percent) and the lowest by South Korea (5.69 percent). By comparison, Canada spends 17.27 percent, the United Kingdom 20.64 percent, France 28.72 percent and Germany 27.25 percent.
As the debate over health care gets underway once again, it’s important we keep pressure on our elected officials to finally do the right thing.
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