Pro: Medicare works at fraction of insurance industry costs

RELATED

Opinion: Should the US adopt a single-payer health insurance system?

The unpredictable and unbearable cost of our health care system drives Americans into bankruptcy, keeps us from life-saving care and distracts our business community from their core businesses.

There is a well-proven solution hiding in plain sight: Medicare. This remarkably successful program rescues American seniors from poverty while dramatically improving their health. At every age group until we turn 65, Americans have the modern world’s worst mortality rates. Once we reach Medicare eligibility, according to data published by the Institute of Medicine in 2013, our mortality rates become among the best in the world.

Medicare accomplishes this feat at a fraction of the operating overhead of the commercial insurance industry. Parts A and B of Medicare report an overhead of less than 3 percent. By comparison, Aetna, Anthem and UnitedHealthcare each report an overhead greater than 15 percent. It’s easy to understand the difference: Medicare wastes virtually nothing on sales, advertising, marketing, underwriting, multimillion-dollar executive salaries or profits.

Medicare today is imperfect. It fails to cover some important health care services (e.g., dentistry and optometry) and exposes seniors to significant financial barriers through deductibles and co-insurance. These flaws have created a niche for supplementary programs and Medicare Advantage. We should embed those corrections into the core offering and provide this improved form of Medicare to all Americans. Both chambers of Congress have popular bills that would accomplish this.

Critics say our nation cannot afford this, but they’re wrong. There are at least 25 studies at both state and federal levels demonstrating that the savings of a Medicare-for-all strategy would match or outweigh any new costs. Economists estimate that anyone earning less than $500,000 per year would save more by eliminating health care premiums, co-pays and deductibles than any small increase in the taxes needed to fund this.

Three of the most important reasons we can afford this are the elimination of the redundant middle-man insurance bureaucracy, purchasing power for pharmaceuticals and medical devices, and global budgeting for regional health care systems.

Critics also say the free market will solve our crisis, but health care is unlike most other products. Our largest health care expenses happen when we are ill, desperate and vulnerable. At those moments, we are the least able to shop around. That’s a problem for a free market solution dependent on individuals becoming more savvy consumers than large teams of actuaries and data analysts.

For more than 52 years, Medicare has proven itself. Now is the time to improve it, provide it to all and stop requiring small businesses to become small health care experts. That’s not why they’re in business. Let’s fix this for the business community, for our nation and for every American.

—Dr. Ed Weisbart, chairman of the Missouri Chapter of Physicians for a National Health Program and professor of clinical medicine at Washington University in St. Louis