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House Democrats propose single payer healthcare legislation amidst the failure of the American Health Care Act

Luke Dalessandro, Politics Editor

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Subsequent of the failure of The American Health Care Act to pass through the House, and President Trump’s calls for bipartisanship in healthcare reform, a collective of over 50 House Democrats proposed The Expanded and Improved Medicare for All Act, single payer healthcare legislation aiming to establish healthcare as a public industry without the presence of for profit companies. The bill underscores its “Medicare for All Program to provide all individuals residing in the United States and U.S territories with free health care that includes all medically necessary care, such as primary care and prevention, dietary and nutritional therapies, prescription drugs, emergency care, long term care, mental health services, dental services, and vision care.”

The concept of implementing a universal healthcare system in the U.S evolved into an increasingly contentious discourse, with the system of medicare for all earning the support of then presidential candidate Sen. Bernie Sanders. While whether healthcare is an industry that belongs in the public or private sector is a vexed debate within U.S political discourse, single payer healthcare is common within industrialized nations. Among organizations included in the Organisation for Economic Cooperation and Development, the U.S and Mexico are the only nations which do not provide some form of single payer healthcare. Opponents of a single payer system in the U.S refer to comparison between many OECD nations, namely states such as France, the U.K, and the Scandinavian region as an excessive example of false equivalence. Predominantly due to population disparity, in which the U.S population of over 300 million exhibits a high difference to the approximately 8 million population of Switzerland, a much lower population to offer public health insurance to. However in comparing the costs of per capita healthcare spending in the U.S and Switzerland, the population disparity is not reflected. Based on OECD healthcare data, the U.S spent $9,086 per capita on healthcare in 2013, but in comparison to many nations with universal healthcare such as Switzerland, which is the second highest spending OECD country, the U.S spends more despite not having implemented a form of single payer. Switzerland spent $6,325 per capita in 2013, whereas even countries with more comparable population to the U.S, such as France with approximately 66 million, spent only $4,361 on healthcare.

Squires OECD Exhibit 02

OECD Health Data for 2013 disseminates that all major OECD nations, despite having a single payer national healthcare system, spend less per capita per healthcare despite the medicare for all system. The U.S spends nearly three times the OECD system despite not having any form of a public option of universal healthcare system.

Concurrently, public expenditure ranks third among major OECD nations in the U.S, despite fewer people being covered. While only 34% of U.S residents are covered under a public healthcare system, in contrast to 100% in the U.K for example, public spending amounted to $4,197, in contrast to the U.K’s $2,802 per capita spending. When expenditure on healthcare is computed as a percentage of GDP, the U.S maintains a substantial lead over all other OECD nations. The U.S expended 17.1% of GDP on healthcare in 2013, the closest competitor, France, spent only 11.6% of GDP on healthcare.  While among high income OECD nations the U.S spends significantly more on healthcare despite being the only to have not implemented a single payer system, the quality of healthcare also reflected a similar disparity for the U.S. Per 1,000 population, the U.S has only 2.6 practicing physicians, based on 2013 OECD healthcare data. This ranked moderately below the OECD median of 2.3, and substantially below Norway, which ranked the highest with 4.3. Subsequently only Canada, with 2.5 practicing physicians, and Japan, with 2.3, ranked below the United States. While costs of healthcare in the U.S stand higher than other OECD nations, while inclusivity has the appearance of being low, less U.S insurance payments go to healthcare and quality costs than nations with a single payer system. In the U.S an average of 80% of healthcare costs go to healthcare and quality improvement programs. The remaining 20% can go to administrative costs and overhead fees. However the 80% is mandated by a provision in the Affordable Care Act, with the rule mandating insurance companies must spend at least 80% of premium dollars on claims and activities to improve health care quality. The percentage of payments going to care ranks much higher among high income nations having implemented single payer healthcare.

Squires OECD Exhibit 01

OECD healthcare data compiling multiple decades discloses that since 1982, the United States has maintained higher healthcare expenditure than all other OECD high income nations, by a substantial margin.

Squires OECD Exhibit 03

The United States has both less practicing physicians per 1,000 residents, and less annual physician visits per capita than the OECD median, ranking in the bottom 4 for both sections, according to OECD healthcare data.

In spite of high income nations employing single payer having lower administrative and per capita costs, advocates of the current U.S healthcare system claim removing healthcare from the private market leads to a decrease in creativity and work in research and development. With no financial incentive for private organizations to carry out research and development on new medical techniques and medicines, critics of single payer argue extensive government grants would be required to sustain medical research under the system, whereas a privatized system breeds competition to increase expenditure on research and development.

Despite this U.S pharmaceuticals have often not reflected lower prices and greater efficiency despite high competition. The practice referred to as shadow pricing in the pharmaceutical industry, in which rather than competition driving prices down and increasing research, companies inflate prices at similar rates, is present in the insulin market. Despite the insulin market being rife with competition, with at least three companies manufacturing and selling insulin, Eli Lilly & Co, Novo Nordisk, and Sanofi Aventis, prices have continued to rise. A 10 millimeter vial of Sanofi’s long acting insulin, debuted on U.S markets in 2001 retailing at $34.81, however since 2014 the same vial retails at $248.51. Competitor Novo Nordisk released Levemir on the U.S market in 2006, at $66.96, since its most recent price raise Levemir costs $269. Within insulin markets competitive products inflated at similar rates as opposed to competition driving prices down, for the same pharmaceuticals.

insulin prices lantus levemir V2

Rising prices in the insulin market reveal despite competition prices have continued to rise steadily despite a lack of innovation in competing pharmaceuticals.

With single payer healthcare legislation introduced by House democrats, advocation of single payer has been implied as a necessary position to earn support from the progressive base of the democratic party. Amidst a Boston rally former presidential candidate and Independent Senator Bernie Sanders underscored this proclaiming, “If every major country on earth guarantees health care to all people and costs a fraction per capita of what we spend, don’t tell me that in the United States of America, we cannot do that.”

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The student news site of New Milford High School, New Milford, New Jersey
House Democrats propose single payer healthcare legislation amidst the failure of the American Health Care Act