Medicare for All, Do We Already Have It?

Medicare for all is a really good slogan, at least to mobilize the base. One would think it would attract the support of even the Tea Partiers who held up signs saying ”Don’t let the government touch my Medicare!” Alas, it has not. This has been a conversation among ourselves on the left and I don’t think we have gotten beyond shouting slogans either.

We need to decide what we want and whether it really is Medicare for All. If we want to go to any doctor we wish, pay nothing and have no premiums, then that is not Medicare.

There are essentially two Medicares, a high option and a low one. The high option has Part A at no cost (funded by the Hospital Insurance Payroll Tax and part of Obamacare’s high unearned income tax, Medicare Part B, with a 20% copay and a $135 per month premium and Medicare Part D, which has both premiums and copays and is run through private providers. Parts A and B also are contracted out to insurance companies for case management.

The low option is the Medicare Advantage (Part C) HMO. You pay a premium and copays, but there is much more certainty, while ABD are more like a PPO, but costs can go much higher. So much higher that some seniors and the disabled get Medicap coverage for the copays.

Medicaid lingers in the background and the foreground. It covers the disabled in their first two years (and probably while they are seeking disability and unable to work). It covers non-workers and the working poor (who are two poor for Obamacare) and it covers seniors and the disabled who are confined to a long-term care facility and who have run out their assets. I am not sure how the long term portion works (and I believe it should be federalized), but for the poor, it takes the form of an HMO, but with no premiums and zero copays.

Obamacare has premiums with income-based supports (one of those facts the Republicans hate) and copays. It may have a high option, like the Federal Employee Health Benefits Program (which also covers Congress) on which it is modeled, but I know that the standard option puts you into an HMO. I know that the HMO drug copays for Obamacare are higher than for Medicare Part C, but the office visit prices are exactly the same.

What does it mean, then, to want Medicare for All? If it means we want everyone who can afford it to get Medicare Advantage Coverage, we already have that. It is Obamacare. I know this because I have Obamacare for another 45 days and will then go to Medicare Advantage. They will likely switch me automatically and I will notice no difference. Indeed, except for premiums and copays, I see little difference in coverage between my Medicaid HMO and my Obamacare Marketplace policy with the same provider. My Marketplace premium is $56 higher than Part B, because it includes drug coverage. I don’t expect Part C to be much more.

If Medicare Advantage is Medicare for All, we have it already. Promising it is pandering to people who don’t know the difference. Why do Tea Partiers want to repeal even that? Because they feel they worked for their coverage and no one else has. Admitting we already have it would be a huge facepalm to them.

I suspect that Medicare for All supporters want something even Medicare does not offer with the free Hospital Insurance (which in Republican parlance would be Single Payer Catastrophic), they want free doctor visits and free drugs (like Medicaid) but with PPO level choice (like Medicare Part B and Part D). If you did that, it would take a huge tax increase, exceeding the best private insurance coverage (which also has copays and premiums). It would replace Medicare, not just lower its age of eligibility.

Real single payer would either require a very large payroll tax (and would eliminate the HI tax) or an employer paid subtraction value added tax (so it would not appear on receipts nor would it be zero rated at the border, since there would be no evading it). If the latter were used (and VAT is more progressive than payroll) employers who provide direct medical care would get an exclusion, but third-party insurance would go away, unless the big companies administered the plan the way Medicare and Medicaid are run. The tax rate would be high enough to cover health payroll taxes for employers and employees, income taxes that fund Medicare and Medicaid and private insurance fees by both employers and employees. Gross pay would go down, but net pay would stabilize.

While we are at it, the subtraction VAT would also cover Social Security payroll taxes paid by employers, although these could be converted to Personal Retirement Accounts holding employer voting stock plus an insurance fund of similar companies. If you are a socialist and don’t recognize that as a good thing, submit yourself for reeducation. The tax would also be high enough to fund a Child Tax Credit of $1000 per child per month distributed with pay (and credited against the tax as applicable). If you are a socialist and don’t like that one either, submit yourself for reeducation on basic Marxism (to each according to their need).

If you want to make some of the Republican Catholic Bishops squirm, market this as a pro-life measure and dare them not to endorse it and force the National Right to Life Committee to do likewise.

Democrats have been criticized for not having a position, other than the slogan Medicare for All, in the current health care debate. As you can see, this is a position and it reflects the realities. It also shows that the Health Care Reform debate is ultimately a tax reform debate. Too much money is at stake for it to be otherwise, although we may do just as well to call Obamacare Medicare for All and agree to leave it alone. Sadly, the Tea Partiers will never let that happen until we give them a better deal. They seem to like their presents.