March 6, 2019

Arguing that “today’s healthcare system fails to provide quality, therapeutic healthcare as a right to all people living in the United States,” and that nearly 30 million Americans are uninsured and 40 million others cannot afford their co-pays and deductibles, Representative Pramila Jayapal (D-WA) and 107 fellow House Democrats introduced the Medicare for All Act (HR 1384) last week.

Essentially, the sweeping and ambitious legislation, which would be implemented over two years, calls for extending Medicare coverage to all Americans, providing coverage for comprehensive services, eliminating all co-pays and deductibles, eliminating private insurance and overhauling the way in which physicians and healthcare providers are reimbursed.  Although the proposal does not specify how the program would be funded, it suggests that blending all coverage into one program would reduce administrative costs and enable Medicare to set physicians’ fees and negotiate drug prices, according to sponsors.

As proposed, the “single payer” bill would provide hospitals an annual prepaid budget to cover each facility’s costs for the year.  Regional directors appointed by the Department of Health and Human Services would oversee all hospitals and medical practices in the area.  The Secretary of Health and Human Services would be given authority for developing a national health budget and negotiating the cost of procedures and medications directly with pharmaceutical companies.

The legislation would exclude private insurance companies from direct competition with the government health plan; however, private insurers could offer coverage that is not in competition with the government program.  Older adults would be included in the new Medicare plan and would receive extended coverage compared with the current plan, as well as coverage for long-term care.

Not surprisingly, the hospital and insurance industries have come out strongly against the proposal.  In a statement, Tom Nickels, executive vice president of the American Hospital Association, said “Medicare for All” represents a “one-size-fits-all” approach that “would disrupt coverage for the more than 180 million Americans who are covered by employer-sponsored health plans.”  Also problematic would be the likelihood of reduced reimbursements to providers, which would only exacerbate existing problems of access to care, he stated.

“The AHA believes there is a better alternative to help all Americans access health coverage—one built on fixing our existing system rather than ripping it apart and starting from scratch,” Mr. Nickels said.  As an alternative, the organization supports expanding Medicaid in non-expansion states, strengthening the marketplaces and increasing efforts to expand the number of people who are covered.

Similarly, Charles N. Kahn III, president of the Federation of American Hospitals (FAH), said “we have a structure that frankly works for most Americans.  Let’s make it work for all Americans. We reject the notion that we need to turn the whole apple cart over and start all over again.”

In a statement, America’s Health Insurance Plans (AHIP) said “the vast majority of Americans are satisfied with the coverage they have today.  They have choice and control over their coverage, options and treatment.”

FAH, AHIP and the Pharmaceutical Research and Manufacturers of America have created a coalition, the Partnership for America’s Health Care Future, to “improve what’s working in health care and fix what’s not.” The coalition also includes the American Medical Association, the Blue Cross Blue Shield Association and the Healthcare Leadership Council, among other groups.

But according to Rep. Jayapal, the current healthcare system “is ineffective, inefficient and outrageously expensive.  It is time to remove the profit motive in healthcare, to resolve the inefficiencies and to guarantee quality, therapeutic healthcare to every person living in the United States.”

The Medicare for All proposal has been sent to the House Energy & Commerce Committee and the Ways & Means Committee, but so far no hearing has been scheduled.