With sweeping ACA repeal apparently off the table for the moment, the Democratic imagination is turning once again toward some version of single payer, or Medicare for all.
I thought I'd try an overview from more than 30,000 feet -- say, from space -- of the tax revenue that might be required to move those now covered by commercial insurance into some kind of public insurance program. That is, converting about a third of current total healthcare spending from private to public. I hope this is not too general, or too vaguely informed, to be useful, but here goes...
1. According to the National Health Estimate, in 2015:
3. At the same time, private insurance pays far higher rates to healthcare providers -- no one knows exactly how much more, but I've heard estimates in the 160% of Medicare range. Medicaid, in contrast, pays about two thirds of Medicare rates on average. [Update, 4/1: It's been pointed out to me that MEDPAC reports commercial rates for physician payments to be about 128% of Medicare -- that is, Medicare pays 78% of commercial rates on average. See p. 98 here. OTOH (added 4/4), a brand new CBO report estimates that commercial rates for hospital inpatient services average about 188% of Medicare, with wide variation. Hospital services accounted for a bit over $1 trillion in spending in 2015, compared to $635 billion for physician and clinical services.]
I thought I'd try an overview from more than 30,000 feet -- say, from space -- of the tax revenue that might be required to move those now covered by commercial insurance into some kind of public insurance program. That is, converting about a third of current total healthcare spending from private to public. I hope this is not too general, or too vaguely informed, to be useful, but here goes...
1. According to the National Health Estimate, in 2015:
- Medicare spending was $646.2 billion, or 20 percent of total NHE.
- Medicaid spending was $545.1 billion, or 17 percent of total NHE.
- Private health insurance spending was $1,072.1 billion, or 33 percent of total NHE.
- Out of pocket spending was $338.1 billion, or 11 percent of total NHE.
3. At the same time, private insurance pays far higher rates to healthcare providers -- no one knows exactly how much more, but I've heard estimates in the 160% of Medicare range. Medicaid, in contrast, pays about two thirds of Medicare rates on average. [Update, 4/1: It's been pointed out to me that MEDPAC reports commercial rates for physician payments to be about 128% of Medicare -- that is, Medicare pays 78% of commercial rates on average. See p. 98 here. OTOH (added 4/4), a brand new CBO report estimates that commercial rates for hospital inpatient services average about 188% of Medicare, with wide variation. Hospital services accounted for a bit over $1 trillion in spending in 2015, compared to $635 billion for physician and clinical services.]
