Millions of Americans live with health care coverage that is either incredibly expensive or poor to nonexistent. It’s no surprise, then, that the push is on throughout the country for some form of universal health care, such as the Medicare for All plan promoted by Sen. Bernie Sanders (I-Vt.).
Is the idea of a universal health care system that’s paid for and run by the government and has only trivial out-of-pocket costs truly plausible?
I’ve been following health care for some 35 years. So just out of curiosity, I decided to look at European countries with universal health care. They’ve appeared to be the utopian goal for health care for many of us over the years, thinking “If we could only get there!”
I was surprised to discover two unsettling realities. One of them is that there is no such thing as universal health care, if by that we mean full and free health care paid for by the government. The other is that the U.S. is in an odd position. Our government pays a larger per-capita percentage of our health care costs than any other country, yet we have out-of-pocket costs that aren’t greatly out of line with other countries.
Here is a brief summary of data compiled by the Commonwealth Fund of 13 mostly European high-income countries that tells the story. Health care spending as a percent of gross domestic product is highest in the U.S., at 17 percent. That is 50 percent higher than in runner-up France, at 11.6 percent. As in the U.S., all of the European systems have out-of-pocket costs. In this category, Switzerland topped the list, averaging at $1,630 per person per year, followed by the U.S at $1,074. The lowest out-of-pocket spending by far was the U.K., at $321 (see the table below).
| Country | Health spending as a percentage of GDP | Out-of-pocket costs (dollars) | Per-capita spending on health care (dollars) | Life expectancy at birth (years) |
| Australia | 9.4 | 771 | 4,115 | 82.2 |
| Canada | 10.7 | 623 | 4,569 | 81.5 |
| Denmark | 11.1 | 625 | 4,847 | 80.4 |
| France | 11.6 | 277 | 4,361 | 82.3 |
| Germany | 11.2 | 649 | 4,920 | 80.9 |
| Japan | 10.2 | 503 | 3,713 | 83.4 |
| Netherlands | 11.1 | 270 | 5,131 | 81.4 |
| New Zealand | 11.0 | 420 | 3,855 | 81.4 |
| Norway | 9.4 | 855 | 6,170 | 81.8 |
| Sweden | 11.5 | 726 | 5,153 | 82.0 |
| Switzerland | 11.1 | 1,630 | 6,325 | 82.9 |
| United Kingdom | 8.8 | 321 | 3,364 | 81.1 |
| United States | 17.1 | 1,074 | 9,086 | 78.8 |
When it comes to public financing of health care, the U.S. is the leader, with per-capita spending of $9,086. Yet despite that investment plus modest out-of-pocket spending, life expectancy in the U.S. is lower than it is in any European country.
It is also worth noting that one can easily find Europeans bemoaning the state of their health care systems. A 2017 report by the British House of Lords said that “Our NHS, our ‘national religion’ is in crisis and the adult social care system is on the brink of collapse.” Another analysis found that that, “Across the world, universal care is in bad shape.”
The greatest obstacle to a Medicare-for-all plan is that it would, not surprisingly, be prohibitively costly. Neither Sanders nor the Congressional Budget Office has calculated its costs. A recent estimate from the Mercatus Center projected that it would increase the federal budget by approximately $36.6 trillion in its first 10 years, although Sanders and others dispute the findings. Enthusiasm for a single-payer plan has been strong in California, but legislative progress in that direction has stalled because of its projected costs.
What I find most disturbing is the comparatively low U.S. life expectancy despite high government spending. The culprit is at least three-headed: inefficiency, high labor and technology costs, and political and other barriers to government control of drug costs and expensive technologies. There is hardly any guarantee that a Medicare for all plan could cut through all those obstacles, or even come close to doing so.
Sen. Elizabeth Warren (D-Mass.) has proposed an alternative plan. She judges that a single-payer plan would be difficult to get through Congress and concedes that private insurance will have to continue. But that insurance would “have to be at least as good and priced as reasonably as the coverage provided by our public health care programs.” The obvious advantage of her plan is that it aims to build upon and improve the embattled Affordable Care Act, likely making it easier to get through Congress than a single-payer plan. Warren’s plan would benefit from the strong gain in public support for the ACA over the past couple of years despite assaults on it by President Trump and other Republicans.
It would be foolish to think that it will be possible in the years ahead to devise an ideal or perfect health care system. The number of Americans age 65 or older, now at nearly 51 million, will rapidly continue to grow, as will medical and technological ways to keep them alive longer. A major consequence will be longer lives, with new drugs and expensive devices to keep people alive longer. Hardly less important, there will be a historic turning point by 2035: The number of those over 65 (78 million) is projected to exceed those under 18 (76.7 million).
Even with great public support for affordable universal care, European countries are stumbling and gasping. The U.S. is likely to do the same. Some improved form of universal care will help, but there is no magic elixir, here or there, to find a politically affordable program covering all health needs.
But progress is possible. Two congressional moves would make a great difference. One of them would be to rescind the 2003 law prohibiting the Department of Health and Human Services from negotiating drug prices on behalf of Medicare beneficiaries. The other would be to set an income-based limit on out-of-pocket health expenses, with government paying the difference.
While I believe that Trump’s view of Medicare for All, which he laid out in a recent op-ed for USA Today, is wrong, its very grandiosity opens the door to resistance. Nonetheless, there is a need for a stronger and more equitable health care system, and Warren’s plan so far is the most plausible.
Daniel Callahan is co-founder and president emeritus of The Hastings Center, an independent bioethics research institute based in Garrison, N.Y.
Why would you trust a government that disregards and fails veterans everyday when it comes to healthcare? Our leaders are not capable of running healthcare in the United States. Our government is bloated, inefficient, corrupt, and populated by citizens you can’t fire. What a joke that we’d let them screw up healthcare like they’ve done with everything else. Give me a break.
Plausible? If the discussion is about plausibility then should the discussion be about the challenges of caring for a population or the actual barriers to universal health care which are the vested interests of corporate America? The challenge of caring for the health of a population is a given – it is either met or not. It can be met by a country that can spend $717 billion per annum on “defense”, but it is not being met; not because the challenge is too great per se, but because it is politically not plausible. It comes down to an ethical decision.
Incidentally, when I worked in the NHS in Scotland the out of pocket expense was zero, unless you count the bus fare in going to see the doctor, but even then, the GP would come and see you if could not make it to the office. Prescriptions were free from the pharmacy/chemist. There is no health care insurance in Scotland under the NHS – it is a service provided by the local health boards and as such has to do more than pay for the cost of care. The NHS has to provide access to care and in the Highlands and Islands that means paying for a GP to be there for patients regardless of the financial inefficiency of having a small practice.
As proponents of universal health care often point out, the insurance system in which the cost of every tablet has to be tied to the patient is hugely inefficient and expensive. It is said to take up at least 20% of each health care dollar spent, not to mention the money that is “wasted” on advertising and profits. Why would Warren propose such an inefficient system? Simply because she realizes that, as you imply, removing insurance from the equation is not politically “plausible”. That is the crux of the matter.
Insurance is a financial planning tool. It is not healthcare. Insurance insures against the risk of financial loss and the insured pays a risk based premium for the coverage.
Insurance is not wasted money on healthcare no more than insurance is wasted money on home ownership or vehicle ownership or life.
How I choose to spend my money to cover my financial risk is irrelevant to national healthcare spending and you do not get to confiscate it to waste it on ineffective government bureaucracies.
Life expectancy at birth a misleading number. Many effects in society determine life expectancy. Healthcare is just one of those. US having a lower life expectancy than the other countries listed just as likely to be driven by the other societal effects. For instance the failed government War On Drugs.
Healthcare in the US is fine, many quality free market providers, there could be more if the States would deregulate the provider licensing process.
Healthcare finance in the US is a mess largely because government regulates far too much of it, drives prices below cost leading to massive cost shifting, and generally incompetent government bureaucracies create havoc within everything they touch.
There is no need for health care insurance in a system where there are no costs other than through taxes. There is no financial risk. Healthcare insurance is an unnecessary diversion of healthcare funds.
Always a need for insurance when there is financial risk. No system will have no out of pocket expenses including for significant expenses for services not covered such as treatments deemed experimental. The vast majority of Traditional Medicare beneficiaries have private Medicare Supplements and Part D Prescription Drug Plans. As I have already stated elsewhere in comments on this article…
Insurance is a financial planning tool. It is not healthcare. Insurance insures against the risk of financial loss and the insured pays a risk based premium for the coverage.
Insurance is not wasted money on healthcare no more than insurance is wasted money on home ownership or vehicle ownership or life.
How I choose to spend my money to cover my financial risk is irrelevant to national healthcare spending and you do not get to confiscate it to waste it on ineffective government bureaucracies.
A nonsensical and privileged take, full of right wing propaganda. Life expectancy, child mortality and various other metrics of the efficacy of a health care system can be measured in different, but regardless of which you use, the US lags far behind our peer nations. You get your own opinions, not your own facts. That you could sit there with a straight face and type out “Healthcare in the US is fine” when we see the lowest healthcare outcomes and highest costs of any of our peer nations suggests that you are either not aware of how the system actually works, or are so insulated by your wealth and privilege that you simply don’t care. Either way, you should be embarrassed.
It is amusing how you provide data supporting a universal healthcare system and then you claim it would be prohibitively expensive. The evidence says it would be half as expensive as compared to the current system.
And in your arguments, it is not even taken in to consideration the millions of citizens who don’t have any healthcare at all!
No system is perfect, but the US is living in the worst system as outlined by the numbers.
On the other hand, it is the perfect system for all people/entities profiteering on the existing system, and that is the only real (and insurmountable) problem. That and the manifest dumb attitude of the US citizens at large