Sanders’ Health Insurance Argument!

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Senator Bernie Sanders who is running for the White House has made the National Health Insurance coverage or single payer as one of his Primary goal.  Given the current environment, it is not surprising that he is being attacked from all sides regarding his view on this issue and being called Socialist or Communist by people do not even understand what Socialism or Communism mean. Senator Sanders has made the argument that the US government could provide single payer insurance coverage for all without much costs.  Former Secretary Hillary Clinton who is also running for the White House has stated that the math does not added up and it could cost the government billions of dollars.  Others from the Republican side have made some statements to that effect.

If one really does think about and perform a true mathematical calculations it would become obvious that math does add up and the US government could indeed offer everyone a health insurance from birth to death or commonly referred to as Medicare for all.

The approach that has been advocated by this author for many years and may not be far from Senator Sanders’ idea.  US spends hundreds of billions of dollars on health care, but the expenditure is not centralized.  If US centralizes the entire expenditure then it would be very practical and rather cost effective to provide health coverage for everyone in the country.  Let’s imagine that there is a pot named Health Insurance Pot where all the money should be collected to, then let’s identify all sources of funds that are currently being spent on the health care which some of these sources are listed below:

The argument will be then the taxpayers are paying higher taxes that is unacceptable.  That is a false argument because, the tax payers just received raise on their income from their employer, and also they are not paying any co-payments, no deductibles which on average is a saving of $5,000 per year.

• Veteran administration funds, rather than having insurance for veterans, take the money and put it in this Pot.
• Medicare funds, right now if one reaches the age of 65, he or she becomes eligible to become covered under Medicare for the rest of his/her life., cancel that coverage and put the money in this pot, which are hundreds of billion dollar per year.
• Medicaid funds, insurance coverage for financially destitute people who are younger than age of 65, cancel it and take the money and put it in this pot.
• State funds, many states offer their own state insurance coverage for special group such as Medi-Cal in California, etc., cancel these coverage and have the states transfer the funds into this pot.
• Employment insurance funds, many employers offer health insurance to their employees, take fifty percent of their insurance funds coverage and transfer to this pot. Then from the remaining fifty percent give back twenty five percent to the employees as increased wages/salaries and keep the other twenty five percent for the company.
• Insurance coverage for federal employees, cancel that coverage and take the money and put it in the pot.
• Many states and local governments offer various versions of Medicare and Medicaid, such as California offering Medi-Cal. Demand that these governments give at least fifty percent of their budget to the Federal government so to be transferred into the Pot.
• Increase the federal withholding income tax by around five to ten percent and transfer these additional tax into the Pot. Note that the tax increase is only on federal withholding and does not include any other deductions.
• Then negotiate with pharmaceuticals, medical providers, and hospitals for much more effective prices. Currently the federal government does not negotiate with the pharmaceuticals and hospitals and pay any prices set by them.

When one adds up the savings on drugs and medical providers and add up the funds in the pot, it will be very substantial.

The argument will be then the taxpayers are paying higher taxes that is unacceptable.  That is a false argument because, the tax payers just received raise on their income from their employer, and also they are not paying any co-payments, no deductibles which on average is a saving of $5,000 per year.  The tax increase was only 5% to 10% which for an average family of four with $70,000 per year income may translate to about $1,500.00 tax increase. But when one compares to the savings on the deductibles, co-payments and the increase in salary the increase in tax will be a wash.

Now let’s examine the social and economic costs and benefits of not having and having health insurance coverage.  It is a well-known fact that millions of Americans do not have any types of health insurance, so when they get sick, they either have to leave with it or if serious illness run to the emergency room which clearly will cost the tax payer substantial amount.  If they do not take care of themselves then the illness stays with them and once they reach the age of retirement and become eligible for Medicare, then they start using the free service.  By this time the minor illnesses have become major, for example a flue not being taken care has developed to a respiratory problem, a minor high blood sugar has developed into a diabetes that require life time treatment and possible some surgery, failure to control the cholesterol is now developed to heart problem with possible heart surgery costing tens of thousands of dollars.  Examples are plenty.

Also many peoples have health insurance through their work, but the co-pay and deductibles are so high that they cannot afford to use it for regular doctors’ visits, etc. and may use it for catastrophic illnesses.  Having health insurance from birth to death will allow people to seek preventive treatment, that is once they get sick to go immediately to doctor and prevent the illness become a major one down the road.  By spending a few hundred dollars now, we could prevent thousands of dollars of future treatment.

Many people hate their job and the only reason they stay at their job is because of health insurance offered by their employer.  Imagine if there was national health insurance, these dissatisfied employees could work for anyone else without regard to benefits and become more productive, or even open up their own businesses and create more jobs without having fear of not having insurance coverage for themselves and their loved ones. Among these groups are many who could be innovators, entrepreneurs who could truly contribute to the economic growth and quality of life for many.

National Health Insurance allows people to become proactive and immediately take care of minor illnesses, because the cost of treatment would be free.  Therefore, they population will be healthier, more productive and when they reach the age of retirement, they would not have as many serious illnesses as the current generation has due to lack of health care. Many people go to work sick, because they cannot afford to go to doctor and while sick they work, what happens not only are not being one hundred percent productive which means the employer is losing money due to their poor performance, but also spread the illnesses to the other employees and making them sick too which causes further disruption in productivity.  I am sure we have all experienced this at our working environment.

Senator Sanders is on the right path and the United States of America can indeed afford to provide health care for all from birth to death without any financial constraint.  The cost of health care in the United States is fifty percent more per capita than in Europe, while in Europe everyone is covered, but in the USA tens of millions of people have no coverage and tens of millions of others have coverage, but cannot afford to use it.

A healthy population offers more productive workforce and creates a happier society. It is amazing that the richest country on earth cannot afford to offer Medicare for all.