Frequently Asked Questions
What is "single payer"?
Single-payer national health insurance is a system in which a single public or quasi-public agency organizes health financing, but delivery of care remains largely private. Under a single-payer system, all Americans would be covered for all medically necessary services,
including: doctor, hospital, preventive, long-term care, mental health, reproductive health care, dental, vision, prescription drug and medical supply costs. Patients would regain free choice of doctor and hospital, and doctors would regain autonomy over patient care.
Is national health insurance "socialized medicine"?
No. Socialized medicine is a system in which doctors and hospitals work for and are paid by the government. Doctors in our Veterans Administration and the Armed Services are paid this way. The health systems in Great Britain and Spain are other examples. But in most
European countries, Canada, Australia and Japan they have socialized health insurance, not socialized medicine.
Won’t this result in rationing like in Canada?
The U.S. already rations care, based on ability to pay. We hear about rationing in other countries’ systems because their systems are publicly accountable, so problems with their health care systems are aired in public (and then addressed). In U.S. health care, this public accountability is absent. Rationing in our system is carried out more covertly through financial pressure, forcing millions of individuals to forgo care or to be shunted away from services they can’t pay for.
Will the government be making medical decisions?
No. It's a myth that with national health insurance the government makes the medical decisions. In a publicly financed, universal health care system, medical decisions are left to the patient and doctor, as they should be. This is true even in the countries like the U.K. and Spain (or in U.S.systems like the VA) that have socialized medicine.
What will be covered?
All medically necessary care would be funded through the single payer, including doctor visits, hospital care, prescriptions, mental health services, nursing home care, rehab, home care, eye care and dental care.
What about alternative care, will it be covered?
Alternative care that is proven in clinical trials to be effective will be covered. For example, spinal manipulation for some lower back conditions would be covered. Antioxidant vitamins would be covered for people with macular degeneration, but not for the general population
(where they appear to be harmful). In general, coverage decisions will be made by the health care planning board or another public body. New kinds of treatments will be added to the benefits package over time as they are shown to be effective, including “alternative” treatments.
Who would determine what treatment and services would be covered?
A “health planning board” would decide on what treatments, medications and services should be covered, based on community needs and medical science, and allocate capital for major new investments based on assessments of where need is greatest. The board would be a public body with representatives of patients and medical experts.
How will we keep costs down if everyone has access to comprehensive health care?
People will seek care earlier when chronic diseases such as hypertension and diabetes are more treatable. We know that both the uninsured and many of those with skimpy private coverage delay care because they are afraid of health care bills. This will be eliminated under such a system. Undoubtedly the costs of taking care of the medical needs of people who
are currently skimping on care will cost more money in the short run. However, all of these new costs to cover the uninsured and improve coverage for the insured will be fully offset by administrative savings.
In the long run, the best way to control costs is to improve health planning to assure appropriate investments in expensive, high-tech care, to negotiate fees and budgets with doctors, hospital and drug companies, and to set and enforce a generous but finite overall
budget.
How will we contain costs with the population aging?
Studies show that aging of the population accounts for only a small fraction of the increases in health costs. Japan and Europe are already facing the problem of an aging population head-on and are doing fine. They have a much higher percentage of elderly than we do, and still spend far less on health care. Germany and Japan recently adopted single-payer long-term care systems to cover the long-term care needs of the elderly at home and in specialized housing. Germany is pioneering a program that pays family members to care for the elderly at home.
How will we keep drug prices under control?
When all patients are under one system, the payer wields a lot of clout to negotiate favorable drug prices. For example, the VA gets a 40% discount on drugs because of its buying power. This “monopsony” buying power is the main reason why other countries’ drug prices are lower than ours. This also explains the drug industry’s staunch opposition to single-payer
national health insurance.
Don’t undocumented immigrants account for a lot of our health care expenditures?
No, actually very little. Foreign-born people, whether legal status or undocumented, account for somewhat less than one-quarter of the uninsured, according to the Census Bureau. Studies indicate that foreign-born people in the U.S.are, on average, healthier and
utilize little health care - about half of the health care (per capita) of U.S.-born persons. Surprisingly this is true whether or not they have insurance. Undocumented immigrants are politically unpopular and hence a convenient target, but they are not the cause of rising health care costs.
Can a business keep private insurance if it chooses?
Yes and no. Everyone has to be included in the new system for it to be able to control costs, reduce bureaucracy, and cover everyone. In Canada, businesses can purchase additional private insurance that covers things not covered by the national plan (e.g. private rooms, orthodontia, etc.). Insurance companies would not be allowed to offer the same benefits as the universal health care system, a restriction contained in the traditional Medicare program. Allowing such duplication of coverage would weaken and eventually destabilize the health care system.
Would labor unions be allowed to opt-out and “keep what they have.”
No. Unions could bargain for supplementary non-covered benefits only.
Why shouldn’t we let people buy better health care if they can afford it?
If the wealthy are allowed to buy better care or jump the queue, health care for the rest of us suffers. If the wealthy rely on the same health system as everyone else, they will use their political power to assure that the health system is well funded. And when the wealthy jump the queue, it results in longer waits for others. Studies in New Zealand and Canada show that the growth of private care in parallel to the public system results in lengthening waits for those in the public system.
What will happen to all of the people who work for insurance companies?
The new system will still need some people to administer claims. Administration will shrink, however, eliminating the need for many insurance workers, as well as administrative staff in hospitals, clinics and nursing homes. Some of these people could find employment in the expanded openings in the fields of long-term care, home health care, and public health. Other workers will need a job retraining and placement program. Such a program would likely cost about $20 billion, a small fraction of the administrative savings from the transition to national health insurance.
Why not use tax subsidies to help the uninsured buy health insurance?
The major flaw of tax subsidies is that they would be used to help purchase plans in our current fragmented system. The administrative inefficiencies and inequities that characterize our system would be left in place, and we would continue to waste valuable resources that should be going to patient care instead.
What is a voucher plan? What’s wrong with it?
A voucher plan is a version of health reform that seeks to provide a simplified means for individuals to purchase health insurance, while retaining the private insurance system intact. The obvious problem here is that it does retain the private insurance system intact, thereby
continuing to subvert over 31% of our health care expenditures for unnecessary administrative costs, marketing, corporate and investor profits, and executive pay, rather than using it for actual patient care.
What about incremental reform of the health system?
Supporters of incremental reform bills present them as “feasible steps” to move us towards single-payer, but the history of these kinds of health reform efforts - Hawaii in 1974, Massachusetts in 1988, Oregon in 1989, Tennessee in 1992, Minnesota in 1992, Maine in 2003, etc. - shows that despite their claims of pragmatism, incremental reforms have
consistently failed for more than three decades. Incremental reforms cannot garner administrative savings on the scale that is needed and redirect them to care.
Why does the U.S. health care system cost so much more than other wealthy industrialized countries’?
There are three reasons why the U.S.health care system costs more than other systems throughout the world. One, we spend two to three times as much as they do on administration. Two, we have much more excess capacity of expensive technology than they do (more CT scanners, MRI scanners, and surgery suites). Three, we pay higher prices for services than they do.
Won’t there be some cost for bureaucracy under single payer?
The United States has the most bureaucratic health care system in the world. Over 31% (a 2003 figure, higher now) of every health care dollar goes to paperwork, overhead, CEO salaries, profits, etc. Because the U.S. has thousands of different insurance plans, each with its own marketing, paperwork, enrollment, premiums, and rules and regulations, our insurance system is both extremely complex and fragmented.
The Medicare program operates with just 3% overhead, compared to 15% to 25% overhead at a typical HMO. Provincial single-payer plans in Canada have an overhead of about 1%.
It is not necessary to have a huge bureaucracy to decide who gets care and who doesn’t when everyone is covered and has the same comprehensive benefits. With a universal health care system we would be able to cut our bureaucratic burden in half and save over $300 billion annually.
How is our health care system currently financed?
About 60% of our health care system is financed by public money, including federal and state taxes, property taxes, tax subsidies, and government purchases of private health insurance for public employees such as police officers and teachers. These funds pay for Medicare,
Medicaid, the VA, coverage for public employees (including police and teachers), elected officials, military personnel, etc. There are also hefty tax subsidies to employers to help pay for their employees’ health insurance. About 20% of health care is financed by all of us individually through out-of-pocket payments, such as co-pays, deductibles, the uninsured paying directly for care, people paying privately for premiums, etc. Private employers only pay 21% of health care costs. It is a “regressive” way to finance health care, in that the poor pay a much higher percentage of their income for health care than higher income individuals do.
How would a universal public system be financed?
Over $300 billion annually would be redirected from unnecessary administrative burden to actual health care. The public funds already funneled to Medicare and Medicaid would be retained. The difference, or the gap between current public funding and what we would need for a universal health care system, would be financed by a payroll tax on employers (about 7%) and an income tax on individuals (about 2%). The payroll tax would replace all other employer expenses for employees’ health care, which would be eliminated.
Won’t this raise my taxes?
The income tax on individuals would take the place of all current insurance premiums, co-pays, deductibles, and other out-of-pocket payments. For the vast majority of people, a 2% income tax is less than what they now pay for insurance premiums and out-of-pocket payments such as co-pays and deductibles, particularly if a family member has a serious
illness.
Is the payroll tax to help fund universal health care unfair to businesses, especially small businesses?
The payroll tax of around 7% would indeed increase costs for businesses that are not currently insuring their workers. However, it would be considerably less than they would pay at present for adequate coverage for themselves and their workers. For most small (and large) businesses already providing coverage, the payroll tax will be less than their
current outlay for medical insurance (average 8.5%).
Thanks to PNHP for providing most of the above material. For further information, and for the pertinent source references, see PNHP's FAQ pages.