Wednesday, January 16, 2019

Medicare for all (who want or need it): A path for presidential candidates

As working assumptions tend crystalize (or harden) unnoticed, I've long assumed that the U.S. can't achieve or even mandate Medicare for All in one leap. The tax hikes are too much for Americans to tolerate, as is transformation by fiat of enormous (and enormously profitable) industries.

Since at least the early aughts, various plans have mapped out Medicare expansion by degrees. In its early iterations, the 'public option' was essentially a Medicare extension offered to people who lacked access to other insurance -- with a buy-in option for employers and/or employees. Some versions envisioned employer-sponsored insurance dying rather rapidly on the vine; others foresaw permanent competition between ESI and the public plan; and others left the question open.

Plans of this sort include Helen Halpin's CHOICE program (2003), Rep. Peter Stark's Americare plan (2006), and Jacob Hacker's Health Care for America plan (2007), all of which allowed employers to buy in to the public plan via a payroll tax. Current iterations include Jeff Merkley and Chris Murphy's Choose Medicare Act, Tim Kaine and Michael Bennett's Medicare X Choice Act (buy-in for small biz only)  and the Center for American Progress's Medicare Extra [update, 1/22: the Medicare for America Act, introduced last December by Reps Rosa DeLauro (CT-03) and  Jan Schakowsky (IL-09), is a close cousin of Medicare Extra. Charles Gaba has a rundown here.]

David Anderson recently outlined the intense challenge Democrats will face, should they gain the presidency and both houses of Congress (with a presumably razor thin Senate majority at best), in prioritizing among a huge list of agenda items demanding Senate floor time in particular (and that's assuming not only that Dems win a trifecta but that all energy isn't absorbed by some megacrisis).  I would add that if an incoming Democratic president chooses not to make healthcare reform priority number 1, patching the ACA would serve as a kind of placeholder. Such patches might start with capping individual market premiums as a percentage of income for all comers and, with varying degrees of cost and complexity, enriching and redesigning the subsidy structure.

What if the newly elected president has run on some kind of commitment to Medicare for all? I suspect the eventual winner (if a Democrat) is likely to hedge, as many Congressional candidates did, and advocate a path to Medicare for all, as the plans outlined above do.

As I've noted before, I thought Tom Malinowski, newly elected in New Jersey's 7th district, handled this distinction well in the campaign:
On healthcare, Malinowski said he “does not support Medicare for all, but the idea of a Medicare option for all is worth exploring.” He said he’s spoken to many people who appreciate having healthcare options and he “would not force anyone to give up private health insurance which many Americans are happy with,” though he added that expanding a Medicare option could eventually lead to a single-payer type of system if people chose it voluntarily.
Later in the campaign, Malinowski came out more firmly for a plan along the lines of CAP's Medicare Extra, which offers a buy-in to all employers and employees. A presidential campaign will probably demand a full-blown plan, as the top three candidates were driven to develop in 2008.

To leave the prospective candidate some flexibility, I would look for a plan to be as modular as possible. First steps might include a strong public option introduced into the ACA -- one tied to Medicare rates, that providers who accept Medicare would have to accept.  Such a plan would probably also entail raising the value of a benchmark ACA plan, as the Merkley-Murphy Choose Medicare Act does. The ACA's silver benchmark, with an actuarial value of 70%, clearly has not cut it with the public (in some cases, it now includes deductibles as high as $6,000). Incremental steps include allowing small business buy-in and (simultaneously or at later phase) large employer buy-in. The point is that integrating first steps with an ACA upgrade enables next steps to be contingent -- on need, budget and system performance. In my view such flexibility is good policy as well as good politics.

Another route is to make all options in an ACA-like marketplace quasi-public, as Medicare Advantage and managed Medicaid plans are.  That is, to impose a more tightly structured plan design, as California does; to enrich subsidies, making 80% AV coverage affordable to all; and to effectively set rates plans pay to providers, whether directly or by capitation. Simplicity, adequacy and cost control are the essentials -- none of which the current marketplace achieves.  Any (originally) individual market that meets those criteria can be opened by degrees to the employer market. 

1 comment:

  1. Excellent post, thanks.

    I can see why the public does not get attached to "an actuarial value of 70%."
    A person might think that if they had an expense of $5,000, then the plan would pay $3500.

    Sorry. A high deductible silver plan will pay $0 in that case.

    If you have a $50,000 expense, the plan will pay about $40,000 so this must average out.

    This seems sleazy to most people, thus the unpopularity of many ACA plans.