THE REAL REASON SINGLE PAYER IS INEVITABLE

                                                                                         
                                                                               

                                                                                 
A recent Associated Press article by Ricardo Alonso-Zaldivar outlined a number of problems with the Affordable Care Act (ACA) that “are leading some to wonder whether “Obamacare” will go down as a failed experiment.” Paradoxically, news that Obamacare is in crisis should be encouraging for anyone who understands the economics of health care.  Until people heavily invested in defending it against unfair attacks see that it won’t work, they won’t understand the need to demand a health care system that will.

While it’s a shame that the number of uninsured will rise before the problem can be fixed, that is the inevitable cost of dismissing the only real solution to rising health care costs and decreasing access:  a single payer system. Robert Reich recently argued this, but he missed the main point. He was right that Obamacare has led to decreased competition as insurance companies consolidated and took over state markets, but this is not what will kill it.  The real reason was evident before the debate on health insurance reform began. It’s called the “death spiral” of health care costs.

The death spiral is simple to explain. The more health care costs rise, the fewer people can afford it. This leads insurers to increase premiums and deductibles in order to maintain profits, leading in turn to fewer people buying insurance, and the cycle repeats. A 2005 study published in American Family Physician projected that the average individual would pay 100% of her income for health care at then-current rates of inflation! This trend started before Obamacare. It was built into the system. It is the reason 45 million Americans were underinsured in 2008. It was the inescapable consequence of a system of private insurance.

Of course, no one will pay all of their income for medical insurance. Very few would pay half of that. However, that’s exactly what the AFP study predicted that would have been the average cost in 2015. That hasn’t happened, but it isn’t because Obamacare has decreased the rate of health care cost inflation. The relative stability of health care costs over the last few years started before ACA’s main provisions took effect, and the rate of inflation has picked up again, worse than before.

ACA manages to mask some of the astronomical cost of medical insurance by providing billions of tax dollars to prevent large premium subsidies for a significant segment of the market.  According to the AP article cited above, over 80% of Healthcare.gov customers get subsidies of about 70% of their premiums. That’s tax money going straight into private pockets for a “service” that adds nothing of value to the provision of health care. Obamacare was, more than anything else, a bailout of a failing Wall-Street owned medical insurance industry. The question is, at what point are Americans going to catch on and realize that pouring all that money into the system just to maintain shareholder profits is a fool’s game?

Obamacare only delays the day of reckoning for a system that is pricing itself out of existence.  If the ACA had not passed, it would be on the verge of collapse now. As it is, insurers are dropping out of exchanges due to unanticipated costs of meeting the standards of ACA that are hurting the bottom line, despite large rate increases as the major provisions of Obamacare kicked in. Rates for individual insurance outside the plan continue to rise by double digits. It’s so bad that the largest provider in Tennessee is requesting increases averaging 62%. In part because of uncontrolled costs, the ACA has also left 29 million uninsured. According to the Congressional Budget Office, that number is not expected to change much even if states currently resisting Medicaid expansion join the program.

There are many other major problems with Obamacare, almost all of which arise from the fact that it is insurance-based. For instance, subsidies still leave a 40 year old man earning $25,000 per year liable for up to $5000 in copays and deductibles. Such costs deter many from seeking needed care.  Those trying to minimize premiums, especially young, healthy adults, often opt for high-deductible plans that could leave them responsible for the first $10,000 in bills and a share of anything over that. In case of catastrophic illness or injury, almost anyone can end up bankrupt. Medical expenses are estimated to be the cause of 60% of bankruptcies. Single payer health insurance thus amounts to bankruptcy insurance as well. That is just one of many benefits of such systems, in addition to the fact that they can provide universal health care at a fraction of the cost of our current non-system.

It’s time to face the facts. Obamacare may have been the best that Democrats could produce, but it is not even close to a solution to the problem of rising costs and declining access to health care. There is no excuse for claiming that single payer is not possible, as Clinton has. To say this is an admission that it is impossible to address the corrupting influence of money in politics. That is not acceptable in a nation that claims to be a democracy. The vast majority of Democrats favor single payer. It’s time they stand up and demand it. Waiting until a Congress awash in Wall Street money to do it on its own is never going to work. We can wait for the system to collapse of its own dead weight, or we can work to make our members of Congress force a real debate on health care reform.

THE VAST LEFT WING CONSPIRACY TO DEFEAT SINGLE PAYER

                                                                              

It’s dismaying to see Hillary Clinton still repeating the discredited idea that a single payer health care system would be too expensive.  Although we already know it provides comprehensive and universal health care at a fraction of the cost of American’s non-system everywhere it has been tried, some of her supporters continue to find various justifications for opposing what polls show 85% of Democrats say they want. There has never been a better example of the self-defeating nature of establishment thinking in the Democratic Party.  Attitudes about Clinton are so fixed that you have to wonder, if the primary were a referendum on single payer, would Democrats actually reject it?

Of course, the election is about much more than that. Sanders has opened and closed the last two debates with well-honed arguments that taking on the corrupting influence of Wall Street would be his first priority. What he has not said in his comments about single payer is that concern for their Wall Street patrons was the reason Democrats took it off the table at the beginning of the health care reform debate in 2009. Their excuse was that it was “unrealistic.” Instead, they offered a bait-and-switch in the form of the Public Option. It was billed as a step to single payer because everyone would choose cheap, comprehensive Medicare-type over the spotty coverage of overpriced private insurance. However, Senator Schumer quickly ended that vain hope when he made a deal to handicap the Public Option so it could not compete with private insurance.

Those who understand the economics of single payer know that the “reform” debate was primarily aimed at bailing out the Wall Street-owned medical insurance industry that was in the process of pricing itself out of existence. This is the “death spiral” of insurance costs: Increasing costs drive people from the market, requiring further increases to maintain shareholder profits and industry executive bonuses, resulting in more people unable to afford insurance. Unchecked, this would soon have led to a situation where average Americans would be paying 50% or more just for insurance premiums. Obviously, this is unsustainable. Enter corporate Democrats, with a “reform” that guarantees millions more customers for the insurance industry, subsidized by taxes that go directly into the pockets of Wall Street investors.

Many rank-and-file Democrats failed to ask themselves what the suppression of the debate about single payer said about the chances of eventually electing a Democratic majority that would put the interests of people over profit. The answer is that the Democratic leadership, being dependent on Wall Street to control the White House, is insufficiently willing to challenge the corruption of the system. Until we find leaders in the party who will, there is no reason to expect anything to change.

Reforming campaign finance would make achieving single payer and accomplishing the rest of the progressive agenda possible. The alternative is abandoning hope of getting what we need in exchange for what we can get, in the name of “pragmatism.” In using this as a selling point for her candidacy, Clinton is apparently arguing that truly representative democracy is a naïve notion.  Elect her, she says, and she will use her experience navigating the existing corrupt system to fight for small, incremental victories that do not challenge the corporate takeover of American government and the economy.

Clinton claims that her experience will enable her to guide us gradually in the general direction of where we need to go. It would be very interesting to hear how she plans to do this in the face of a hostile Congress that is likely to continue to be dominated by Republicans who have a visceral hatred for her. Would Democratic chances be any worse with a “socialist” who has explained that all he means by the term is someone who will fight for all Americans, rather than compromise principle on the altar of expediency?

Sanders cannot pass single payer by himself, but neither can Clinton honestly promise to deliver any meaningful reforms of the Byzantine, unaffordable and woefully inadequate system of Obamacare. It will take a mass movement of Americans demanding their government put their interests over corporate profit to get real health care reform.