I agree with Paul Krugman's take here—including his observation that Medicare For All isn't politically viable. But I've long thought that something along the lines of what Pete Buttigieg was touting—more or less single payer for all who want it (aka a public option) would be the best way to get us to where we need to be: robust, truly universal coverage with private health insurance relegated to ancillary services. I believe this concept should be at the heart of the next round of healthcare reform.
Yes, well, one hopes in 2029 (or, more likely, 2031 given Senate math) Democrats will be a bit more single-minded about what needs to be done than they were in 2010.
A great Republican lawmaker, a true believer in bipartisanship. To MAGA, Joe is a RINO. The truth is that Joe is a true Republskills.
I should know because I grew up in a very active Republican family, but thankfully of the moderate variety. I spent summers hanging out at dusty state and county fairs, eating tons of elephant ears and sticky cotton candy.
My mom held senior positions in the national and state Republican Party. She fought the extremists, including a gadfly named Phyllis Schafly, who was perhaps the loudest voice against the Equal Rights Amendment, despite being a successful attorney.
If one is a moderate, he or she could fit in the other Party. That was me. And it was my mom too, as she voted for Obama (after the McCain campaign asked her to be a delegate!)
I could go on here about my parent's accomplishments in politics and life (one was raising a crazy teenager). Having been born to them, my political DNA drew me to run for the Illinois State Senate (I lost to a Chicago machine candidate).
Thanks for reading these memories. Writing them is good for my mind and for honing my author's skils.
I think "universal health care" that immediately replaces private insurance is not viable but making Medicare available to everyone is. This would weaken the grip of the insurance companies. Perhaps, start by dropping it to say 50 years old and then point out the incremental cost to cover everyone is then really small.
The problem is insurance companies are providing basic Medicare coverage through Medicare Advantage plans. The industry argued that they could provide better coverage for the same per person cost as traditional Medicare and still make a profit — because of the “magic of the free markets”. Then insurance company execs whined to the Bush administration that they weren’t making enough profit, completely undercutting their justification for being allowed to participate in the first place. Of course they got more funds with little attention from the media. From what I have read Medicare Advantage plans now cost us taxpayers an extra 22% per person.
The problem is that the health care system as constituted won’t run on Medicare reimbursements. Private health insurance pays a lot better than Medicare does.
Paul Krugman is correct when he says people getting health insurance through their employer are comfortable with what they have and would be reluctant to support Medicare For All. Maybe Paul Krugman should point out to those people that if they lose their job, they lose their health insurance. If everyone had to purchase their health insurance on their own off of the exchange, you would see overwhelming support for Medicare For All.
Also I think people greatly overestimate how good their health insurance is while they don’t really need it intensively. Rubber hits the road when something goes wrong.
They don't need to lose their job to lose their "wonderful" health insurance. Their employer could take it away at any time and give them United Healthcare or something worse.
Agreed: the reason this proposal meets such vigorous opposition is the certainty that the public option would rapidly become the de facto healthcare system and therefore land us at "Medicare for All."
Wow, your insight certainly qualifies you for a senior executive position at any number of compassionate health care carriers! Not even to mention as an exec assistant for the incoming HHS director.
No, we will not tolerate more socialism. Whatever the government touches turns to trash. The more control you give them, they more of your life they can destroy. Reform doesn't solve the problem; abolishment does.
Get rid of the Federal Reserve and all central banks. End all government. Let those parasites fend for themselves. Let producers keep their wealth and do what they please with it.
Administrative bloat will disappear, prices for every good and service will plummet, and the quality of all of them will shoot up.
I just got back from an extended stay in France. Healthcare coverage there is an absolute dream—simple, quick, efficient, comprehensive, and cheap—compared to the US model.
You're entitled to your own opinion, but not your own facts.
Calm down. Facts are facts and you being upset doesn't change that. Government ruins everything sooner or later. Most people in a French ER will wait all day due to funding cuts. If you had a good experience, then 1) you probably just have a low bar, and 2) it doesn't mean that all forms of "health" care in France go well for customers.
The US model is getting more and more socialist, and that's why it's getting worse. Luckily, people are dropping their policies due to exorbitant costs and instead are putting those premium amounts into high yield savings accounts for emergencies. This will reduce revenue for government-backed big insurance companies, and that will mean getting rid of administrative bloat. They will stall, but they can't avoid it forever.
If you depend on government for your health, then you are at the mercy of the biggest slimeballs on earth.
A free market where the dollar value is high, the costs of procedures are low, and people can just pay for a surgery with about the same expenditure as what a single premium is now? That is the way.
Insurance should be the old community model where a group of neighborly people pool their money and negotiate with local care providers and make them go to bid over the entire group.
Nothing fetches best price and high quality like competition does. Having someone do the admin stuff as their job and paying them out of the pool is fine, but once the state gets involved, it's all a race to the bottom.
The day we implement “Medicare for all who want or need it,” is the day every American worker becomes a free agent. And that is why the US Chamber of Commerce lobbies against any single-payer program. The way it stands, employers are in control of their employees mobility, aka, The American Way.
I would take great comfort in your/PB's suggestion for the healthcare reform but I, like so many before me realize the huge Corp hump to get over first. In other words, to be brutally honest, it'll be an effen cold day in July before BigCorp swallows that load.
I’m less certain that M4A is once and for all time not viable politically. That being said, there are three significant obstacles that advocates won’t face up to:
* Health care is a human right. Personally, I agree that in a wealthy democracy, people have a right to health care. But in the United States—unlike in virtually every other developed nation—there’s no consensus on this point. Other than repeating the point as if it were a truism, advocates have done little to change the terms of the discussion
* American health care is broken. In a way, it’s worse than broken. If it were actually broken—as in every European country after WW2–the discussion would be completely different. What we actually have is something that works just well enough just enough of the time for just enough people as to make sweeping reform just about impossible. It’s hard to push reform when you are fighting on terrain that is different than you think it is
* The disruption factor is real. I’m retired now. When I was young with a young family, we benefited from a top-notch corporate plan. As much as I supported M4A in the abstract, I would have taken a deep breath if faced with actually replacing what we had. I wasn’t being selfish, either—I was putting my family first. This is the human face on what Mr Krugman is getting at. When advocates don’t face up to this—and I’ve yet to encounter one that admits to the disruption factor—their basic argument comes across as academic
Nonetheless, M4A is not out of eternally out of reach politically because at some point the delay-deny-defend insurer tactic will infect corporate benefit plans. M4A advocates can be prepared for that if they start working on establishing a consensus that health care should be a right in this country.
Isn’t this where the “public option” comes it? Create a competitor to private insurers to break their power—not by fiat, but by providing an alternative to their model of malincentives. Another route is to make the insurance industry better by enforcing antitrust laws. The vertical integration creates conflicts of interest that raise costs, and the horizontal consolidation means there’s no real competition. Matt Stoller and David Dayen talk a lot about these dynamics.
My husband and I are 80, and in reasonable.health. We have Medicare and we also have
individual supplemental policies to get nearly full coverage MINUS drugs which, knock on wood, neither of us has had to take very much of. With the SS deductions for medicare and the two "supplemental" policies, we pay $1100 a month for medical insurance. Almost 20% of our gross income. That's real life out here in America.
Paul said, "So I’m not calling for an attempt to end private health insurance." But why settle for the status quo? Only a radical overhaul of the system, a total war against these parasites, can bring about the change we need!
Half measures and wishy-washy rhetoric by opportunists aren't the way forward. I read a post on a website that certifies people for $750 to sell Medicare Advantage that Ukraine is beginning to sell health insurance at clinics. This is a country still at war that currently has universal, free healthcare. The slimy profit-maximizing parasites are everywhere.
Krugman pointed out—correctly—that the what we have works for a lot of people. Which is really the issue: What we have works just well enough for just enough people just enough of the time as to make reform very difficult. When M4A advocates carry on about our broken health care system, tens of millions of voters have no idea what they are talking about. Reform is pretty much impossible when the reformers don’t understand the landscape.
I make less than 200K. There is no way that I am glad or somewhat glad that anyone short of Adolf Hitler was assassinated while walking down the street.
“ But, like, the country just celebrated the death of a health insurance executive. And it was not just isolated pockets - pretty much every single person who makes less than $200k a year is at least somewhat glad Mangione did what he did, if not explicitly approving of it.”
Professor Krugman: Thanks for the excellent analysis. But it is even worse, much worse, than you describe. Insurance companies inject monopoly power into our medical system. A few huge insurance companies, including UnitedHealthCare, control most of the insurance market, which gives them great power over providers. Through mergers with pharmacy companies (e.g., CVS and Aetna) even more power is consolidated. Insurers also control pharmacy benefit managers (PBMs). PBMs are so powerful that, as the NYT reported yesterday, pharma companies are willing to pay kickbacks to PBMs to ensure that patients can buy their drugs, even to encourage addiction to drugs like opioids.
It astounds me that people who are afraid of government controlling healthcare are happy to let a small number of monopoly insurers and major healthcare providers control our healthcare.
I was getting physical therapy. Insurance paid $80 per hour though the EOB always said the "real" cost was $320. When my prescription ended, I asked the provider if I could continue and I would pay personally. They said "only if you pay $320 per hour. If we charge you less than that, the insurers will kick us out of the network".
This must change! Cash payers and uninsured patients should pay the same rates the insurance companies pay.
In South Africa, many healthcare providers will give you a discount of 10-20% if you paid in cash coz it saves them dealing with the medical aids & trying to squeeze payment out of them.
The insurer didn’t set the $320 rate, the provider did, then signed a contract with the insurer giving a 75% discount. If they charged you $80, they could only charge the insurer $20. The core problem is the vastly overinflated retail price.
I’m one of the traditional Medicare enrollees who gives it near 100% satisfaction. The private insurers who provide the Supplemental coverage are not in a position to deny anything. I find that many seniors enrolled in Advantage plans do not know there is a distinction; it is all Medicare to them. Disingenuous Advantage advertising like “combines traditional Medicare with extra services” sucks them in.
Agreed! I have traditional Medicare and a complex inflammatory disorder. I have been able to select the specialized, skilled team (provider by provider) that I need to manage my care. I have not needed a referral to see my specialists, nor insurance interventions in my services (except the Part D insurance that likes to drop one of my meds just after enrollment ends). Under Medicare Advantage, I would likely be dead by now. I try to influence other seniors to avoid Medicare Disadvantage - you may be healthy now, but old age comes with surprises.
One of my friends in an Advantage needed to see a specialist for some condition I don’t remember. Turned out the only in-network specialist she could see was located in a remote town not well served by public transport and essentially beyond reach as she does not drive. Dirty, deliberate trick.
Exactly. These Disadvantages must hire scores of staff researching nefarious schemes to avoid paying. I read lots of substacks warning about Trump’s Chosen Ones but little or nothing about Dr. Oz running Medicare and Medicaid. He has had hundreds of thousands $$$ invested in Disadvantage Plans and quack cures (hydroxychloroquine as just one example). Do you think Trump plans to get a cut off Oz’s conflicts of interest? MFs!
As I watch the DOGE boys in action I am getting very skeptical traditional Medicare will be spared, probably via unnecessary firings that render it inefficient, difficult to deal with, a headache for doctors to deal with. A government program with low overhead and high beneficiary approval cannot go unscathed.
If only there were a way for people to voluntarily give up their current private plans in favor of (improved and expanded) Medicare, maybe call it a public option or something.
I am on supplemental plan thru Medicare. Have no complaints, no copays, no denials, no need for authorization and I can see any specialist I want. I almost changed to an advantage plan because the prices sounded so good. They advertise no monthly premium and drugs, vision, and hearing are covered.
As I looked into more, and even signed up, I came to find out thru readings from Thom and Reich what was going on. Insurance companies don’t tell you which is private or what original Medicare is.
They don’t even tell you how different they are. They should be required to to inform patients how different these plans are. I bet a lot of people signing up for advantage plans would at least have the information needed to understand how private insurance is such a ripoff. I canceled my advantage plans and went back to a Medigap or supplement plan.
People over 65 can give up their Medicare private plan and get a supplemental or Medigap original Medicare plan that is not run by a private corporation but rather a government regulated plan that does not work for profits.
1) Most Medicaid coverage is now also administered through private insurance companies (MCOs).
2) In KFF polling, Medicare Advantage enrollees are about as satisfied as traditional Medicare enrollees -- but the problems in MA tend to come when you need serious care (especially post-acute), which doesn't show up in aggregate polling numbers.
3) Insurers "save" healthcare spending by denying not only needed but unneeded care -- and it's difficult to parse out the proportions of each. Surveys indicate that MA plans do encourage people to get screenings and so may prevent more acute care down the road.
4) Some healthcare economists (e.g., Austin Frakt) find evidence that Medicare Advantage treatment protocols "spill over' into trad. Medicare and so save money there
5) Private companies (MACs) also administer traditional Medicare, but with a very broad coverage grant and few coverage denials. MACs have no incentive to deny coverage.
6) In countries that deliver universal healthcare through private insurers, such as Germany and Japan, major medical insurers must be nonprofit.
7) Private insurers probably do have the capacity or potential to add administrative and care management value. But in the U.S., profit skews the incentives. In fact, it skews incentives for providers as much as for insurers. Almost all participants are geared toward revenue maximization ("nonprofit" or not).
8) In the U.S. whatever money insurers save by managing (denying) care is swamped by overpaying providers, which happens because we have no uniform payment rates, so providers divide and conquer. In the case of Medicare Advantage, where providers are paid Medicare rates or less, the savings are negated by payment formulas that overpay MA plans on a capitated basis, via a) an ridiculous risk adjustment system that incentivizes massive gaming, b) over-generous payment benchmarks, and c) bonus payments based on quality ratings that don't measure quality effectively.
Hello from an Italian. I really don't understand this hatred against public health that is discarded regardless by you Americans. It is revalued by the individual only when he/she finds himself/herself ruined.
Hatred is cultivated. Our far-right uses Fox News for extensive persuasion & propaganda to promote the agenda of the rich and powerful. This has happened since nobody is fighting hard to stop the propaganda - delivered under the over-arching banner of freedom of speech. Unlike Trump, Democrats failed to use executive orders, lawsuits, bribery, threats, and well positioned allies. The Democrats are fighting all their battles on the wrong hill, while using inadequate strategy & tactics.
We Americans are, as always, afraid of what we don’t know. It is quite frustrating. I’m quite sure we would be rioting in favor of totalitarianism and repression if that was the norm in our society.
Evil companies will always call an ethics problem a public relations matter. First advice from PR professionals with integrity (maybe a dying breed): fix your ethics first
Joining the rest of the civilized world and enact universal healthcare.
They spend a third of what the US does for objectively better outcomes. TWO-THIRDS of what we spend on Healthcare is therefore the excessive overhead and private profit.
> So we really have a system in which taxpayers foot the bill for around 80 percent of health insurance. Yet much of that money flows through private insurance companies.
That’s how Bismarck universal health systems work too.
You also present a false dichotomy. The choice isn’t just between single payer and no universal healthcare, in fact single payer systems are failing everywhere, even in the Nordics. Bismarck style health systems present the best combination of aligned incentives, economic rationality, and universal coverage.
I've long admired the German healthcare coverage model (if that's what you're alluding to here), but understand for profit insurance plays a relatively minor role in Germany. The "sickness funds" that cover the vast bulk of the population are stringently regulated, non-profit enterprises. Their system also utilizes a fairly robust form of all payer rate setting—aka price controls.
I'd be happy to see the US migrate to such a system. But it would be a pretty radical departure from the US status quo.
The German model is one interpretation, yes, in reality there are many forms of the Bismarck model. The Netherlands, Switzerland, France, and Belgium all have their variation, with the public, private, and charity sectors all playing different roles in each. Perhaps the Dutch model might be preferable for the US to aim for as it allows firms to operate for profit, and has excellent results.
As I understand it the Dutch and Swiss models are essentially just Obamacare but with actual teeth. It is however, also very expensive in terms of overall healthcare spending.
Have you read the post? Krugman only presents those two alternatives, and doesn’t even mention multi payer healthcare systems. How is it a non sequitur if we’re considering healthcare systems?
In 2010 Obama and Democrats in Congress were definitely single minded in what needed to be done: Lift U.S. economy out of a Great Recession and stimulate economy without triggering inflation.
Let’s never forget Obama and Democrats in Congress had to clean up after Republican-led financIal deregulation policies led to the Great Depression—akin to the Wall Street crash of 1929 and lasted 10 years. In 2010 Democrats had to deal Republicans in Congress constant and unanimous pushback from Republicans on every policy initiative proposed.
Let’s never forget that millions of people lost their homes to foreclosure (many illegal bank foreclosures). Let’s remember Steve Mnuchin. Before DJT appointed him Treasury Secretary, Mnuchin CEO of OneWest bank, dubbed 'foreclosure king’ of California. Let’s remember in 2010 the unemployment rate was 10%. Let’s remember 50 million people in USA had no health insurance in 2010. Let’s remember Ken Cuccinelli, the Republican conservative extremists who didn’t give AF about the uninsured people and immediately began wasting his time plus Virginia tax payers money with a lawsuit against Obama Administration over the Affordable Care Act. Let’s remember that now, December 2024, there are 10 Republican-controlled states still that choose to leave more than 1.5 million of their constituents uninsured by not adopting Medicaid expansion.😳
In essence, it’s not possible for a Democrat WH Administration and Democrats in Congress to focus on a single-minded issue, if I’m correctly understanding your interpretation. Historically, Republican Administrations f*ck up U.S. economy while Democrats are forced to it clean up in too many areas impacted while Republicans publicly clutch their pearls about Dems federal spending—determined to make Democrats in congress suffer and pay a political price for digging U.S. out of their created messes. Sadly, too many people who actually vote fall for this 'wash, rinse, repeat Republican ploy.
Thank you for the Warpaint! They fuel my hopefulness. The billing-coding-payment shadow banking industry produces nothing for customers, only profits for investors. It is a massive jobs program that wastes our health and well-being as a nation. Retired nurse-midwife here--I know some things. Just not how to break them.
My preferred method of comparison between public vs private health insurance &/ healthcare is bang-for-the-buck, i.e. “how much healthcare do a person receive for evey dollar paid in premiums, health tax & co-payments?” Economics would call it rent seeking by the gatekeepers, i.e. extracting excess money without adding value.
Taking into account the profits of private health insurance & private healthcare providers, incl. inflated costs of specialists, private hospitals & medicine, as well as administrative costs, I would not be surprised if it is like 60c in healthcare for evey $1 in premiums. (10c-12c profit to health insurance providers, 10c-12c to private healthcare providers, 5c-10c in excess in medicines & 10c-15c for administrative costs by all involved)
An efficient public system could provide 90c-95c for every $1 in health tax. (The VA provides it as high as 97c for every $1, & the NHS in the UK is likely about 90c-93c for every $1 in taxes, but it is inefficient for most of its clients). But this depends on avoiding high costs for medicines, paying below market rates for its workers, underinvestment in capital, not maintaining its existing capital, etc. in reality, it will likely be more like 80c-85c in healthcare services for every $1 paid in health tax. In a public system with high levels of corruption/ rent seeking, excess investment in capital infrastructure, high wages, etc it may come down to 50c-60c for every $1 paid in tax. (E.g. many developing countries such as South Africa).
Isn’t part of the issue that hospitals are forced to take on a bunch of toxic debt in the form delinquent copayments and resort to extortion of people with decent healthcare plans to make up the difference ($3000-$5000 MRIs for example)? While I think a little friction for services makes sense (copays), so that hospitals aren’t overwhelmed, a system where copayments are significant for everyone seems wild. Shouldn’t we have a progressive copayment similar to taxes. It seems like we have a system where insurance company not only skim off the top but also dump all the downside risk on to their customers and hospitals.
I agree with Paul Krugman's take here—including his observation that Medicare For All isn't politically viable. But I've long thought that something along the lines of what Pete Buttigieg was touting—more or less single payer for all who want it (aka a public option) would be the best way to get us to where we need to be: robust, truly universal coverage with private health insurance relegated to ancillary services. I believe this concept should be at the heart of the next round of healthcare reform.
Readers may wish to Google the name “Joe Lieberman.”
Yes, well, one hopes in 2029 (or, more likely, 2031 given Senate math) Democrats will be a bit more single-minded about what needs to be done than they were in 2010.
If you YouTube it instead, you can watch him lie about why he wouldn’t support a public option.
A great Republican lawmaker, a true believer in bipartisanship. To MAGA, Joe is a RINO. The truth is that Joe is a true Republskills.
I should know because I grew up in a very active Republican family, but thankfully of the moderate variety. I spent summers hanging out at dusty state and county fairs, eating tons of elephant ears and sticky cotton candy.
My mom held senior positions in the national and state Republican Party. She fought the extremists, including a gadfly named Phyllis Schafly, who was perhaps the loudest voice against the Equal Rights Amendment, despite being a successful attorney.
If one is a moderate, he or she could fit in the other Party. That was me. And it was my mom too, as she voted for Obama (after the McCain campaign asked her to be a delegate!)
I could go on here about my parent's accomplishments in politics and life (one was raising a crazy teenager). Having been born to them, my political DNA drew me to run for the Illinois State Senate (I lost to a Chicago machine candidate).
Thanks for reading these memories. Writing them is good for my mind and for honing my author's skils.
I don't have to google - I well remember the position he took. One of many reasons to despise him.
it was Lieberman who killed the public option.
https://slate.com/news-and-politics/2009/10/did-sen-joe-lieberman-just-kill-the-public-option.html
Also, remember Hartford is known as "The Insurance City".
I think "universal health care" that immediately replaces private insurance is not viable but making Medicare available to everyone is. This would weaken the grip of the insurance companies. Perhaps, start by dropping it to say 50 years old and then point out the incremental cost to cover everyone is then really small.
The problem is insurance companies are providing basic Medicare coverage through Medicare Advantage plans. The industry argued that they could provide better coverage for the same per person cost as traditional Medicare and still make a profit — because of the “magic of the free markets”. Then insurance company execs whined to the Bush administration that they weren’t making enough profit, completely undercutting their justification for being allowed to participate in the first place. Of course they got more funds with little attention from the media. From what I have read Medicare Advantage plans now cost us taxpayers an extra 22% per person.
Why does Medicare advantage cost an extra 22% per person you may ask?
https://www.wsj.com/health/healthcare/medicare-health-insurance-diagnosis-payments-b4d99a5d?st=ybaf6g10f6c3rmt&reflink=article_copyURL_share
If your answer was fraud, you were correct.
The problem is that the health care system as constituted won’t run on Medicare reimbursements. Private health insurance pays a lot better than Medicare does.
Paul Krugman is correct when he says people getting health insurance through their employer are comfortable with what they have and would be reluctant to support Medicare For All. Maybe Paul Krugman should point out to those people that if they lose their job, they lose their health insurance. If everyone had to purchase their health insurance on their own off of the exchange, you would see overwhelming support for Medicare For All.
Also I think people greatly overestimate how good their health insurance is while they don’t really need it intensively. Rubber hits the road when something goes wrong.
They don't need to lose their job to lose their "wonderful" health insurance. Their employer could take it away at any time and give them United Healthcare or something worse.
That doesn’t change whether providers will be able to function with a heavier Medicare mix.
Private health insurers spend about $1.2 trillion a year, much more than a $300 billion tax subsidy.
Agreed: the reason this proposal meets such vigorous opposition is the certainty that the public option would rapidly become the de facto healthcare system and therefore land us at "Medicare for All."
Wow, your insight certainly qualifies you for a senior executive position at any number of compassionate health care carriers! Not even to mention as an exec assistant for the incoming HHS director.
Unfortunately, you are correct.
No, we will not tolerate more socialism. Whatever the government touches turns to trash. The more control you give them, they more of your life they can destroy. Reform doesn't solve the problem; abolishment does.
Get rid of the Federal Reserve and all central banks. End all government. Let those parasites fend for themselves. Let producers keep their wealth and do what they please with it.
Administrative bloat will disappear, prices for every good and service will plummet, and the quality of all of them will shoot up.
>Whatever the government touches turns to trash<
Utter nonsense.
I just got back from an extended stay in France. Healthcare coverage there is an absolute dream—simple, quick, efficient, comprehensive, and cheap—compared to the US model.
You're entitled to your own opinion, but not your own facts.
Calm down. Facts are facts and you being upset doesn't change that. Government ruins everything sooner or later. Most people in a French ER will wait all day due to funding cuts. If you had a good experience, then 1) you probably just have a low bar, and 2) it doesn't mean that all forms of "health" care in France go well for customers.
The US model is getting more and more socialist, and that's why it's getting worse. Luckily, people are dropping their policies due to exorbitant costs and instead are putting those premium amounts into high yield savings accounts for emergencies. This will reduce revenue for government-backed big insurance companies, and that will mean getting rid of administrative bloat. They will stall, but they can't avoid it forever.
If you depend on government for your health, then you are at the mercy of the biggest slimeballs on earth.
A free market where the dollar value is high, the costs of procedures are low, and people can just pay for a surgery with about the same expenditure as what a single premium is now? That is the way.
Insurance should be the old community model where a group of neighborly people pool their money and negotiate with local care providers and make them go to bid over the entire group.
Nothing fetches best price and high quality like competition does. Having someone do the admin stuff as their job and paying them out of the pool is fine, but once the state gets involved, it's all a race to the bottom.
The day we implement “Medicare for all who want or need it,” is the day every American worker becomes a free agent. And that is why the US Chamber of Commerce lobbies against any single-payer program. The way it stands, employers are in control of their employees mobility, aka, The American Way.
I would take great comfort in your/PB's suggestion for the healthcare reform but I, like so many before me realize the huge Corp hump to get over first. In other words, to be brutally honest, it'll be an effen cold day in July before BigCorp swallows that load.
I’m less certain that M4A is once and for all time not viable politically. That being said, there are three significant obstacles that advocates won’t face up to:
* Health care is a human right. Personally, I agree that in a wealthy democracy, people have a right to health care. But in the United States—unlike in virtually every other developed nation—there’s no consensus on this point. Other than repeating the point as if it were a truism, advocates have done little to change the terms of the discussion
* American health care is broken. In a way, it’s worse than broken. If it were actually broken—as in every European country after WW2–the discussion would be completely different. What we actually have is something that works just well enough just enough of the time for just enough people as to make sweeping reform just about impossible. It’s hard to push reform when you are fighting on terrain that is different than you think it is
* The disruption factor is real. I’m retired now. When I was young with a young family, we benefited from a top-notch corporate plan. As much as I supported M4A in the abstract, I would have taken a deep breath if faced with actually replacing what we had. I wasn’t being selfish, either—I was putting my family first. This is the human face on what Mr Krugman is getting at. When advocates don’t face up to this—and I’ve yet to encounter one that admits to the disruption factor—their basic argument comes across as academic
Nonetheless, M4A is not out of eternally out of reach politically because at some point the delay-deny-defend insurer tactic will infect corporate benefit plans. M4A advocates can be prepared for that if they start working on establishing a consensus that health care should be a right in this country.
Isn’t this where the “public option” comes it? Create a competitor to private insurers to break their power—not by fiat, but by providing an alternative to their model of malincentives. Another route is to make the insurance industry better by enforcing antitrust laws. The vertical integration creates conflicts of interest that raise costs, and the horizontal consolidation means there’s no real competition. Matt Stoller and David Dayen talk a lot about these dynamics.
I’d sign up.
My husband and I are 80, and in reasonable.health. We have Medicare and we also have
individual supplemental policies to get nearly full coverage MINUS drugs which, knock on wood, neither of us has had to take very much of. With the SS deductions for medicare and the two "supplemental" policies, we pay $1100 a month for medical insurance. Almost 20% of our gross income. That's real life out here in America.
Paul said, "So I’m not calling for an attempt to end private health insurance." But why settle for the status quo? Only a radical overhaul of the system, a total war against these parasites, can bring about the change we need!
Half measures and wishy-washy rhetoric by opportunists aren't the way forward. I read a post on a website that certifies people for $750 to sell Medicare Advantage that Ukraine is beginning to sell health insurance at clinics. This is a country still at war that currently has universal, free healthcare. The slimy profit-maximizing parasites are everywhere.
Krugman pointed out—correctly—that the what we have works for a lot of people. Which is really the issue: What we have works just well enough for just enough people just enough of the time as to make reform very difficult. When M4A advocates carry on about our broken health care system, tens of millions of voters have no idea what they are talking about. Reform is pretty much impossible when the reformers don’t understand the landscape.
Only 19% of Americans view Mangione in even a "somewhat positive" light. https://x.com/JHWeissmann/status/1867646659360129061
I make less than 200K. There is no way that I am glad or somewhat glad that anyone short of Adolf Hitler was assassinated while walking down the street.
“ But, like, the country just celebrated the death of a health insurance executive. And it was not just isolated pockets - pretty much every single person who makes less than $200k a year is at least somewhat glad Mangione did what he did, if not explicitly approving of it.”
Did you not mean what you wrote?
You are a vile person to glorify and celebrate that murderer.
Professor Krugman: Thanks for the excellent analysis. But it is even worse, much worse, than you describe. Insurance companies inject monopoly power into our medical system. A few huge insurance companies, including UnitedHealthCare, control most of the insurance market, which gives them great power over providers. Through mergers with pharmacy companies (e.g., CVS and Aetna) even more power is consolidated. Insurers also control pharmacy benefit managers (PBMs). PBMs are so powerful that, as the NYT reported yesterday, pharma companies are willing to pay kickbacks to PBMs to ensure that patients can buy their drugs, even to encourage addiction to drugs like opioids.
It astounds me that people who are afraid of government controlling healthcare are happy to let a small number of monopoly insurers and major healthcare providers control our healthcare.
Thank you for this! If only there was enough investigative reporting and exposes of the grift….
I was getting physical therapy. Insurance paid $80 per hour though the EOB always said the "real" cost was $320. When my prescription ended, I asked the provider if I could continue and I would pay personally. They said "only if you pay $320 per hour. If we charge you less than that, the insurers will kick us out of the network".
This must change! Cash payers and uninsured patients should pay the same rates the insurance companies pay.
In South Africa, many healthcare providers will give you a discount of 10-20% if you paid in cash coz it saves them dealing with the medical aids & trying to squeeze payment out of them.
The insurer didn’t set the $320 rate, the provider did, then signed a contract with the insurer giving a 75% discount. If they charged you $80, they could only charge the insurer $20. The core problem is the vastly overinflated retail price.
I’ve never seen that provision in a contract.
I’m one of the traditional Medicare enrollees who gives it near 100% satisfaction. The private insurers who provide the Supplemental coverage are not in a position to deny anything. I find that many seniors enrolled in Advantage plans do not know there is a distinction; it is all Medicare to them. Disingenuous Advantage advertising like “combines traditional Medicare with extra services” sucks them in.
Agreed! I have traditional Medicare and a complex inflammatory disorder. I have been able to select the specialized, skilled team (provider by provider) that I need to manage my care. I have not needed a referral to see my specialists, nor insurance interventions in my services (except the Part D insurance that likes to drop one of my meds just after enrollment ends). Under Medicare Advantage, I would likely be dead by now. I try to influence other seniors to avoid Medicare Disadvantage - you may be healthy now, but old age comes with surprises.
One of my friends in an Advantage needed to see a specialist for some condition I don’t remember. Turned out the only in-network specialist she could see was located in a remote town not well served by public transport and essentially beyond reach as she does not drive. Dirty, deliberate trick.
Exactly. These Disadvantages must hire scores of staff researching nefarious schemes to avoid paying. I read lots of substacks warning about Trump’s Chosen Ones but little or nothing about Dr. Oz running Medicare and Medicaid. He has had hundreds of thousands $$$ invested in Disadvantage Plans and quack cures (hydroxychloroquine as just one example). Do you think Trump plans to get a cut off Oz’s conflicts of interest? MFs!
As I watch the DOGE boys in action I am getting very skeptical traditional Medicare will be spared, probably via unnecessary firings that render it inefficient, difficult to deal with, a headache for doctors to deal with. A government program with low overhead and high beneficiary approval cannot go unscathed.
If only there were a way for people to voluntarily give up their current private plans in favor of (improved and expanded) Medicare, maybe call it a public option or something.
I am on supplemental plan thru Medicare. Have no complaints, no copays, no denials, no need for authorization and I can see any specialist I want. I almost changed to an advantage plan because the prices sounded so good. They advertise no monthly premium and drugs, vision, and hearing are covered.
As I looked into more, and even signed up, I came to find out thru readings from Thom and Reich what was going on. Insurance companies don’t tell you which is private or what original Medicare is.
They don’t even tell you how different they are. They should be required to to inform patients how different these plans are. I bet a lot of people signing up for advantage plans would at least have the information needed to understand how private insurance is such a ripoff. I canceled my advantage plans and went back to a Medigap or supplement plan.
People over 65 can give up their Medicare private plan and get a supplemental or Medigap original Medicare plan that is not run by a private corporation but rather a government regulated plan that does not work for profits.
A few notes:
1) Most Medicaid coverage is now also administered through private insurance companies (MCOs).
2) In KFF polling, Medicare Advantage enrollees are about as satisfied as traditional Medicare enrollees -- but the problems in MA tend to come when you need serious care (especially post-acute), which doesn't show up in aggregate polling numbers.
3) Insurers "save" healthcare spending by denying not only needed but unneeded care -- and it's difficult to parse out the proportions of each. Surveys indicate that MA plans do encourage people to get screenings and so may prevent more acute care down the road.
4) Some healthcare economists (e.g., Austin Frakt) find evidence that Medicare Advantage treatment protocols "spill over' into trad. Medicare and so save money there
5) Private companies (MACs) also administer traditional Medicare, but with a very broad coverage grant and few coverage denials. MACs have no incentive to deny coverage.
6) In countries that deliver universal healthcare through private insurers, such as Germany and Japan, major medical insurers must be nonprofit.
7) Private insurers probably do have the capacity or potential to add administrative and care management value. But in the U.S., profit skews the incentives. In fact, it skews incentives for providers as much as for insurers. Almost all participants are geared toward revenue maximization ("nonprofit" or not).
8) In the U.S. whatever money insurers save by managing (denying) care is swamped by overpaying providers, which happens because we have no uniform payment rates, so providers divide and conquer. In the case of Medicare Advantage, where providers are paid Medicare rates or less, the savings are negated by payment formulas that overpay MA plans on a capitated basis, via a) an ridiculous risk adjustment system that incentivizes massive gaming, b) over-generous payment benchmarks, and c) bonus payments based on quality ratings that don't measure quality effectively.
I tightened these points up a bit and added links here https://xpostfactoid.substack.com/p/krugman-is-health-insurance-a-parasitical
Hello from an Italian. I really don't understand this hatred against public health that is discarded regardless by you Americans. It is revalued by the individual only when he/she finds himself/herself ruined.
Hatred is cultivated. Our far-right uses Fox News for extensive persuasion & propaganda to promote the agenda of the rich and powerful. This has happened since nobody is fighting hard to stop the propaganda - delivered under the over-arching banner of freedom of speech. Unlike Trump, Democrats failed to use executive orders, lawsuits, bribery, threats, and well positioned allies. The Democrats are fighting all their battles on the wrong hill, while using inadequate strategy & tactics.
We Americans are, as always, afraid of what we don’t know. It is quite frustrating. I’m quite sure we would be rioting in favor of totalitarianism and repression if that was the norm in our society.
Evil companies will always call an ethics problem a public relations matter. First advice from PR professionals with integrity (maybe a dying breed): fix your ethics first
The creation of Medicare Advantage plans was a dismal and destructive addition to the holding of private health insurance companies.
So, what do you propose?
Joining the rest of the civilized world and enact universal healthcare.
They spend a third of what the US does for objectively better outcomes. TWO-THIRDS of what we spend on Healthcare is therefore the excessive overhead and private profit.
That's no way to run a country...
My question too !
MFA, clearly. He just doesn’t think we will do the right thing.
> So we really have a system in which taxpayers foot the bill for around 80 percent of health insurance. Yet much of that money flows through private insurance companies.
That’s how Bismarck universal health systems work too.
You also present a false dichotomy. The choice isn’t just between single payer and no universal healthcare, in fact single payer systems are failing everywhere, even in the Nordics. Bismarck style health systems present the best combination of aligned incentives, economic rationality, and universal coverage.
I've long admired the German healthcare coverage model (if that's what you're alluding to here), but understand for profit insurance plays a relatively minor role in Germany. The "sickness funds" that cover the vast bulk of the population are stringently regulated, non-profit enterprises. Their system also utilizes a fairly robust form of all payer rate setting—aka price controls.
I'd be happy to see the US migrate to such a system. But it would be a pretty radical departure from the US status quo.
The German model is one interpretation, yes, in reality there are many forms of the Bismarck model. The Netherlands, Switzerland, France, and Belgium all have their variation, with the public, private, and charity sectors all playing different roles in each. Perhaps the Dutch model might be preferable for the US to aim for as it allows firms to operate for profit, and has excellent results.
As I understand it the Dutch and Swiss models are essentially just Obamacare but with actual teeth. It is however, also very expensive in terms of overall healthcare spending.
But still significantly less expensive than the US’s current system, and with better outcomes
That's not a dichotomy. That's a single fact. And your comment is a non-sequitur. Have a nice day. =)
Have you read the post? Krugman only presents those two alternatives, and doesn’t even mention multi payer healthcare systems. How is it a non sequitur if we’re considering healthcare systems?
In 2010 Obama and Democrats in Congress were definitely single minded in what needed to be done: Lift U.S. economy out of a Great Recession and stimulate economy without triggering inflation.
Let’s never forget Obama and Democrats in Congress had to clean up after Republican-led financIal deregulation policies led to the Great Depression—akin to the Wall Street crash of 1929 and lasted 10 years. In 2010 Democrats had to deal Republicans in Congress constant and unanimous pushback from Republicans on every policy initiative proposed.
Let’s never forget that millions of people lost their homes to foreclosure (many illegal bank foreclosures). Let’s remember Steve Mnuchin. Before DJT appointed him Treasury Secretary, Mnuchin CEO of OneWest bank, dubbed 'foreclosure king’ of California. Let’s remember in 2010 the unemployment rate was 10%. Let’s remember 50 million people in USA had no health insurance in 2010. Let’s remember Ken Cuccinelli, the Republican conservative extremists who didn’t give AF about the uninsured people and immediately began wasting his time plus Virginia tax payers money with a lawsuit against Obama Administration over the Affordable Care Act. Let’s remember that now, December 2024, there are 10 Republican-controlled states still that choose to leave more than 1.5 million of their constituents uninsured by not adopting Medicaid expansion.😳
In essence, it’s not possible for a Democrat WH Administration and Democrats in Congress to focus on a single-minded issue, if I’m correctly understanding your interpretation. Historically, Republican Administrations f*ck up U.S. economy while Democrats are forced to it clean up in too many areas impacted while Republicans publicly clutch their pearls about Dems federal spending—determined to make Democrats in congress suffer and pay a political price for digging U.S. out of their created messes. Sadly, too many people who actually vote fall for this 'wash, rinse, repeat Republican ploy.
https://stateline.org/2024/07/19/in-the-10-states-that-didnt-expand-medicaid-1-6m-cant-afford-health-insurance/
Thank you for the Warpaint! They fuel my hopefulness. The billing-coding-payment shadow banking industry produces nothing for customers, only profits for investors. It is a massive jobs program that wastes our health and well-being as a nation. Retired nurse-midwife here--I know some things. Just not how to break them.
My preferred method of comparison between public vs private health insurance &/ healthcare is bang-for-the-buck, i.e. “how much healthcare do a person receive for evey dollar paid in premiums, health tax & co-payments?” Economics would call it rent seeking by the gatekeepers, i.e. extracting excess money without adding value.
Taking into account the profits of private health insurance & private healthcare providers, incl. inflated costs of specialists, private hospitals & medicine, as well as administrative costs, I would not be surprised if it is like 60c in healthcare for evey $1 in premiums. (10c-12c profit to health insurance providers, 10c-12c to private healthcare providers, 5c-10c in excess in medicines & 10c-15c for administrative costs by all involved)
An efficient public system could provide 90c-95c for every $1 in health tax. (The VA provides it as high as 97c for every $1, & the NHS in the UK is likely about 90c-93c for every $1 in taxes, but it is inefficient for most of its clients). But this depends on avoiding high costs for medicines, paying below market rates for its workers, underinvestment in capital, not maintaining its existing capital, etc. in reality, it will likely be more like 80c-85c in healthcare services for every $1 paid in health tax. In a public system with high levels of corruption/ rent seeking, excess investment in capital infrastructure, high wages, etc it may come down to 50c-60c for every $1 paid in tax. (E.g. many developing countries such as South Africa).
Isn’t part of the issue that hospitals are forced to take on a bunch of toxic debt in the form delinquent copayments and resort to extortion of people with decent healthcare plans to make up the difference ($3000-$5000 MRIs for example)? While I think a little friction for services makes sense (copays), so that hospitals aren’t overwhelmed, a system where copayments are significant for everyone seems wild. Shouldn’t we have a progressive copayment similar to taxes. It seems like we have a system where insurance company not only skim off the top but also dump all the downside risk on to their customers and hospitals.