Many dark and miserable months into the 2020 Democratic primary, the nation is still enduring the sight of the candidates having the same fights over health care, like an exhausted married couple whose quarrels will always come back to What Was Said at that party in 2008. It seems we are doomed to push the “how will you pay for it” rock up the hill forever, but we’re also seeing other attacks leveled against Sanders and Warren over and over: Why do you want to kick people off their private insurance? Don’t you trust the American people to make their own choices? Why don’t you love Obamacare? Can you actually get things done?
These attacks are leveled by candidates with plans that all fall well short of the benchmarks that Medicare for All sets for itself, in an effort to depict Medicare for All as dangerous or unrealistic. But these candidates fail to grapple with the danger and false promises of their own plans—including the big lie that by creating a public option, we can maintain private insurance (the main goal being to protect the private insurance industry’s buckraking) while also providing health care to everyone. If the primary debates are any guide, these plans—and this fatal flaw—have been deemed to be immune from scrutiny.
The public option is the phony diet option of Medicare for All, promising to have none of the calories and all of the taste. These plans pretend that everyone can keep their specific insurance plan that they like; that everyone can be covered, with no gaps in enrollment, no cracks for people to fall into; that insurance companies, drug companies, and big hospitals can be brought on board to pass legislation without compromising on universality or quality. Medicare for All, on the other hand, grabs the bull by the horns and deals directly with the issue: Private, employer-sponsored insurance is a bad way to provide health care, and no one should have it.
One of two things would happen under the public option plans put forth by Pete Buttigieg, Beto O’Rourke, or Joe Biden. One possible outcome is that the public option on offer could be robust and equitable, with good coverage, low premiums, and functionally solid mechanisms for automatic enrollment and the accurate determination of subsidies. (This is more likely under O’Rourke’s preferred Medicare for America proposal than Joe Biden’s plan, for example.) This would encourage many people to sign up, instead of sticking with their employer coverage. If this happens, private insurance could well get weaker; insurance company revenues would go down and additional costs would be passed on to patients in order to make up for the profit shortfall and maintain the plum salaries of executives. Fewer people being enrolled in private insurance might well mean insurance companies won’t have as much to offer to hospitals when negotiating prices (though they clearly already do a terrible job of that). Private insurance would die a drawn-out death, and it might not be pretty.
This prospect isn’t just speculation; this is a firmly stated virtue of the plan, that the public option will be so attractive that eventually everyone is on it—what Buttigieg calls the “glide path” to Medicare for All. The idea is to defeat insurance companies at their own game, with the government providing such a darn good product that private insurance will just slink off into the shadows, because of competition and freedom. Markets, as we know, always work logically and correctly. Do we think that UnitedHealth Group, which had profits of more than $3 billion last quarter, will go quietly? More importantly, if the goal is to slowly smother private insurance, why promise that people can keep their plans that they like—plans that you intend to ultimately kill?
The second possible outcome is that the public option could be mediocre or poor, with unreasonable premiums or poor coverage, which would not provide people much incentive to switch to it unless they had no other choice. (Hospitals and the private insurance industry would prefer this.) In this case, the public option will be relegated to second-class status, and those marooned there would experience all of the typical privations of downmarket health care coverage.
This could happen even under the best-designed plans—if you want to keep private insurance, you have to give people a reason to stay on it. Under Medicare for America, for example, people making more than 600 percent of the federal poverty level would pay “no more than” 8 percent of their income as premiums for the public plan, meaning a single person making 601 percent of the federal poverty level ($75,064, which is a lot of money but not exactly a king’s ransom) would pay $6,000 a year, or five times the current average employee contribution for an employer-sponsored plan. Clearly, the slightly-richer would be better off on employer-sponsored insurance; worse-off people who don’t have or can’t afford private insurance will end up on the public option. The public option will have to shoulder the greater burden of caring for poorer populations, which tend to be sicker, thus increasing costs.
Neither option is great. If we are trying to kill private insurance by providing a better public option, why not just cut to the chase and address the real issue—that private insurance, especially employer-subsidized insurance, is just bad? But this is not what the public options really want to do—they want to make everyone happy. You cannot make everyone happy.
This is a fundamental problem with means-tested programs—the false notion that, if you just get enough wonks to put their big brains to it, you can create a way of ensuring that benefits will only extend to the truly deserving, and that all of those who are deserving will get the benefits. But when it comes to deciding what programs will be means-tested, ideologues usher the wonks out of the room and apply their own lens to the determinations. The result is a welter of inconsistency. If you’re a socialist, you might think there’s no reason why free college should be means-tested either; if you’re a libertarian, you might think it’s actually a jolly good idea to abolish public schools, now that you’ve mentioned it. Most lawmakers seem to agree that we shouldn’t use income to determine who has access to public schools, roads, or bridges. There’s nothing inherent to any of these areas of government activity that makes it obvious whether or not these programs should be universal or not; most of what determines that comes down to what a majority of decision-makers hold to be the role of government in society.
But even if you are a centrist who believes that only poor people should get free health care, you then have to design a system that ensures no one richer than your definition of poor gets free health care, and that all the poor people who qualify for free health care actually do receive it. This is not as easy to do as the candidates who back such plans believe it to be. For all the talk about how Medicare for All is a “pie in the sky” idea, what’s left unsaid is that as soon as the wonk trigonometry that undergirds these plans makes contact with the mischiefs of ideology (and the depredations of industry lobbyists), these public option pastries are also launched into the cloud layer.
Compared to Buttigieg or Biden’s plans, which are (perhaps intentionally) lacking in detail, Medicare for America does the best job at contending with this challenge—they really did their wonk-work on this one. As with premiums, out-of-pocket costs would be set on a sliding scale, from zero for people making less than 200 percent of the federal poverty level, up to $3,500 for an individual, or $5,000 for a family making 600 percent. It would supposedly automatically enroll the uninsured, but doesn’t specify how; the bill simply calls for “a process established by the Secretary for the automatic enrollment of eligible individuals who are not enrolled in other qualified health coverage.” This is not a small question that they’ve left in the hands of some future bureaucrat to puzzle out; it’s the whole ballgame. If you can’t ensure seamless coverage for everyone who doesn’t have private insurance, you have not created a universal program.
These plans are all incredibly convoluted ways to avoid doing a very simple and much more morally correct thing: covering everybody. They make the fatal political miscalculation of taking something that is very hard to do and making it very complicated to do, as well. They recognize that everyone needs health care, which is why they subsidize care for less well-off people, but go to immense lengths to avoid paying for the care of people who are deemed to be able to afford it by the Wonk Formula.
For example, Medicare for America promises to automatically enroll the uninsured, but also expects everyone to pay income-based premiums. How sure can you be that these uninsured people will be able to afford their subsidized premium—even if they have high student loan payments, or car payments, or are supporting a family member, or have credit card debt, or live in an expensive city? Are you positive that your Deserving Poor Matrix is generous enough to cover everyone, every eventuality, without anyone ever losing coverage because your math couldn’t capture the vast range of human experience, misery, and misfortune in America? How confident are you in your wonk-work? Confident enough to say no to a system where no one is personally financially liable for ensuring their own care, or not?
You might say, well, nothing is perfect, and that’s true. You might say, it’s better than what we have now, this is certainly a fair assessment. You could say that Medicare for All promises a lot, too, and would raise taxes to boot. But promising the best of all worlds, where private insurance and public option seamlessly work together to provide insurance that never provides a cost barrier to anyone, is at best dangerous and at worst a recipe for another Affordable Care Act disaster. If we’re going to go down the road of promising people that they can keep their plans once again, you better be absolutely sure that’s true.
Perhaps the next time the candidates appear on a debate stage, the same level of scrutiny and skepticism can be applied to the public option mavens and their plans, which are, if anything, woven from their own strands of gossamer. Medicare for All is a bunch of promises, and so are the public option plans. But the public option promises to be clever, where Medicare for All promises to be kind. We should find out which promises are the empty ones.