Yale Study: Universal Health Coverage Could Save $1 Trillion and 114,000 Lives a Year

I'd like to believe this, but the study makes a bunch of really hasty assumptions.

The authors derive the $1T number from $1.3T in total cost savings and $304B in incremental spend (incremental spend is due to insuring more people). The $1.3T in cost savings come from five big buckets: lower pharmaceutical prices, Medicare-level payments to providers, reduced administrative overhead, less fraudulent billing, and fewer avoidable emergency department visits and hospitalizations.

The buckets themselves don't necessarily survive much scrutiny.

Take "Medicare-level payments to providers". Hospitals have an operating margin of 2-5%. Medicare pays 50% less than private insurance. So doing this would require either layoffs, cutting salaries for doctors/nurses/etc, or both. This may well be the right decision for society as a whole--that's a big part of the debate here--but there's no free lunch.

The line item of "fewer avoidable emergency department visits and hospitalizations" assumes greater insurance coverage leads to greater access to primary care. It's true that great primary care prevents hospitalizations, and can be a net cost saving under certain assumptions [1]. But, we're actually in a primary care shortage. Existing insurance payments for primary care are low enough that private practices are going out of business and fewer residents are going into family medicine. Cutting rates (the paragraph above) would make this worse.

For "less fraudulent billing," a lot of people in […]

We've been down this road. ACA was predicated on studies like this, to no avail (it turns out that intense opposition chips away at it over time regardless of these studies).

I'm of the opinion that, if your solution requires perpetual majority control of legislative, executive, and judicial branches, your solution is in fact a campaign slogan.

I'm not saying that this is what is happening now, but I am saying that calls for universal health coverage, no matter how correct and well supported, are going to probably face the same obstacles they did last time, so we need new coalitions and implementation proposals if we're going to give it a go again. It has to be different enough that those who would oppose it right after the inevitable pendulum swing do not want to.

The US is far too broken for such a thing to ever come to be. Politicians are bought and paid for, and the impact on the insurance companies and their profits make this impossible.

US legislators will never, ever, ever put the needs of the people above the needs of corporations, not as long as corporations can wield their massive wealth as "free speech" in the form of lobbying and political donations.

Sounds nice, though.

In a more sane world the Republican Party would be in favor of universal health coverage. How many potential entrepreneurs stay working at BigCorp because they need the health benefits? How many small businesses are crushed by the cost of providing healthcare to their employees? It would be great for business to remove any involvement they have in personal healthcare.

But I suppose they are the party of big business, not the party of business in general.

>A single-payer universal health care system could cover every American, save more than 100,000 lives a year, and still cost $1 trillion less than the system it would replace, according to a new preprint study led by researchers at the Yale School of Public Health.

Most of the problems of the US system aren't really a matter of who pays, but the fact that so much is paid for services, at every level. Any really significant savings, cutting bureaucracy and pressuring providers to make costs resemble those of other developed countries, are taking money out of someone's pocket. Many hundreds of thousands of them, if not millions. This makes any significant reform very difficult, as those people vote, and will know exactly who made them worse off, even if the country in general was made much better off.

Read The Logic of Collective Action by Mancur Olsen. It wasn't written thinking of healthcare. but anyone looking at the US healthcare system will see that what is going on is stacks upon stacks of collective action beating overall societal efficiency, over and over and over again, in such a way that it's basically in none of the decision makers best interest to actually increase overall efficiency.

What about quality of care tradeoffs? In Canada, for example, you are forced to use the government system, and if it doesn't deem you important enough, there is no private option.

There have been studies like this for decades, going back to at least the Clinton administration.

And nothing will come of it. Too many entrenched interests, regulatory capture, and lobbying + political donations.

Universal Health Coverage has a lot of other benefits:

1. It detaches health insurance from the employment market. This means those minimum wage walmart jobs just became more feasible, or any low end job really, since their is no pressure to provide "benefits" anymore. This would seriously lubricate the labor market, because the friction to providing, taking, and changing a job is reduced.

2. It ends a bias for group plans. If you are poor or are a trades worker and need to buy insurance outside of a group plan, you are going to be in an expensive high risk pool.

3. Its a benefit we can fund socially with taxes that will immediately have a positive impact on lower income workers, as well as poorer regions of the country (e.g. red states).